Ep. 282: Michael Pryor, Co-Founder & CEO @ Trello, now Head of Trello Product with Atlassian following their recent acquisition.
Kolton Andrus is the Founder & CEO @ Gremlin, the failure as a service startup finds weaknesses in your system before they cause problems.
Dylan Serota, Co-Founder and Chief Strategy Officer @ Terminal, the startup that helps you create world-class technical teams through remote operations as a service.
Rachel Carlson, Co-Founder and CEO @ Guild Education, the leader in education benefits offering the single most scalable solution for preparing the workforce of today for the jobs of tomorrow.
Sid Sijbrandi, Founder & CEO @ Gitlab, a single application for the entire software development lifecycle.
Jeppe Rindom is the Founder & CEO @ Pleo, the simple spending solution for your company automating expense reports and simplifying company expenses.
Pssst 🗣 Loving our podcast content? Listen to the start of the episode for a promo code to our upcoming events!
In Today’s Episode We Discuss:
- How should founders think about the debate between all remote vs part remote teams? How does life and operations change with each? What are the pros and cons? Is it possible to move between the two overtime?
- What can one do to maintain culture with remote teams? What processes need to be in place to ensure a cohesive and streamlined communication process? What technical architecture needs to be in place? Where are the breakpoints when it comes to communication? How often does one need to do in person off-sites?
- How does being remote or part remote impact fundraising? How do VCs think about this new structure of operations? What is the right way to present it? How does being outside a core tech hub impact one’s ability to raise? How should one run a fundraising process if outside a core hub?
- How important is it for your team to be near your customers? How does this change according to sector and customer base? How important is it for your team to be near your investors? Does having an exec and sales team in one place and the rest of the team elsewhere work?
Ep. 283: Nicole Alvino, founder of SocialChorus, shares some ‘truth is crazier than fiction stories’ about her time in structured finance at Enron and how she applied what she learned to build a company that has 10 of the Fortune 50 as customers. In your constant effort to grow and win, you’ll get the 5 most important lessons on how to push the envelope just far enough – while keeping your ethics in check.
SaaStr’s Founder’s Favorites Series features one of SaaStr Annual’s best of the best sessions that you might have missed.
This podcast is an excerpt from Nicole’s session at SaaStr Annual 2019.
If you would like to find out more about the show and the guests presented, you can follow us on Twitter here:
Below, we’ve shared the transcript of episode 282.
Harry Stebbings: Welcome back to the official SaaStr podcast with me, Harry Stebbings, at hstebbings1996 with two Bs on Instagram, and today for the show I really wanted to do something quite different. I get a ton of founders ask me how they should think about remote work, whether they need to be close to customers, close to clients? What parts of the org need to be together versus not. All these questions centered around location. And so I thought I’d bring an episode together with multiple different leading industry voices sharing their perspectives and experiences on how they’ve approached location and remote work.
Harry Stebbings: I do also really want your feedback here, so do let me know when you think of this type of episode on Instagram at hstebbings1996. Again, it’d be great to see you there.
Harry Stebbings: Now I’m very excited to dive into what is a very unique episode, as I said, centered all around location and remote work.
Harry Stebbings: We’re starting with Michael Pryor, founder of Trello, on how to create cohesion between your remote work team.
Michael Pryor: It’s actually harder if you only have a few remote people because then your company doesn’t actually feel remote. One of the things for us was, it got easier as more and more people got remote because then we would do things with remote in our minds. Like we would have a meeting and everyone would just be on the video conference on their computer. We wouldn’t all get in a conference room and have one person on the TV who would feel disconnected from the group. It was just everyone was on equal footing, everyone was in the video conference.
Michael Pryor: So I think to the extent that you act like a remote company can be really, really important and make it a lot easier. So I think you have to prioritize that. It comes with cost. So for example, the social aspect that you might have if you’re all in one place, you miss out on that and you have to figure out ways to deal with that.
Michael Pryor: For example, we get everyone together in person once a year, which is not cheap, but it’s something you have to do. And we also schedule these impromptu, what we call them Mr Rogers meetings, where four people from the company will be paired together. It’s at random, you just get connected to somebody at the company to just hang out and talk for 20 minutes on Friday about whatever, not work related. Just get into a video conference and just chat and meet some people. Because if you’re working as a distributor at a remote company, most of the time you’re only talking to the people in your team. And so you’re not forming connections with the other parts of the company. And so you have to basically put in place some kind of structure to do that, that might normally happen in a physical workplace where you’re in the lunch room or at the coffee bar or something like that.
Michael Pryor: So it’s more about understanding the way that your company will work and figuring out things that you might need to do that you wouldn’t have to do if you were all in one place.
Harry Stebbings: The next segment is with Kolton Andrus, founder and CEO at Gremlin, on why he believes remote work is the future of employment.
Kolton Andrus: In my mind, this is just an evolution in the way that we do business. No longer are the days, I said this, it came up in conversation yesterday, no longer are the days where we have one corporate headquarters. There are many places where people are able to work and coordinate. And one of the keys there has been having good sources of truth. Now that we can use something like Slack or a chat program, then we can move the office conversations from being at HQ and into a place where everyone that needs to know can observe them or participate in them. And so I think it’s just more powerful. It allows us to be more flexible. It allows us to hire in different places. It allows us to, when people want to travel or if they need to go home and be with family or whatever comes up, it seems just superior in the logistics.
Harry Stebbings: And for the engineers of the world, it absolutely makes sense. When working in sales and marketing, where maybe the idea sharing and team collaboration elements are more central, do you find it still has such success?
Kolton Andrus: I think that there’s a balance. In my mind it’s a bit of an 80:20. I think most of the time you still get the value of being remote, whether you’re in sales or marketing. Those same kind of conversations and context sharing things can happen in text or on a video call. But there is value in being face to face and having that camaraderie. We actually have our entire team together today from around the country and around the Bay to have an all hands and to share context and then to hang out and play poker later and drink a couple of beers. And so you want that, but it doesn’t have to be all or none. You can have a little bit of both.
Harry Stebbings: So with the many positives, you said there, everything from cost to personal freedom, what are the big challenges then in establishing this? And what did you have to overcome to really make it a part of Gremlin?
Kolton Andrus: Yeah, it was easy in the early days because it was a couple of engineers just trying to get work done and coordinating. But as we grew it became more of a challenge. I think the thing that I learned that surprised me was, it’s not necessarily where people are, but when people are. If you have somebody, we had somebody early on that was in Europe, and the time zone overlaps between Europe and California were such that most of our meetings and most of our discussions needed to happen in this hour or two overlap. And a lot of the ad hoc discussion or debates that would come up would happen more in the afternoon, Pacific time, he didn’t feel a part of, and that left him feeling less part of the team.
Kolton Andrus: And so while we tried to shift time and do things as much as possible to support him, it ended up not being a good fit for him and he left the team. And so, this is one that I always, kind of retrospect in my head, what could we have done better? How could we have approached it? And in part the lesson is, time zone overlap is important and it’s something to be thoughtful of.
Harry Stebbings: Can I ask, you mentioned the element of cost there earlier, do you have comp adjusted to location? Obviously San Francisco, as you said, living in the Bay, it’s one of the most expensive places in the world to live, compared to say Texas, which is cheaper. Do you have comp adjusters?
Kolton Andrus: Yeah, so we can be flexible in that regard. I’ve moved to using market data for different locations in how we choose to put offers forward. And then how we look at compensation. In the first early days, in the first few hires, it wasn’t as relevant. Some people could be paid a little bit less for cost of living, but we were all making less and we were picking people up for what we could.
Kolton Andrus: As we’ve grown, I’ve seen it to be a little bit more, but frankly, while the Bay is one of the most expensive places, a lot of the other places I’m finding talent, the cost of living and the market has risen, not to the same extent, but proportionally. And so, I think it’s an advantage, but it’s not one that I’m super high on that I’m writing down, that’s like my favorite thing about it.
Harry Stebbings: Next we have Sid, founder and CEO at Gitlab, discussing why they have an all remote team structure.
Sid Sijbrandi: Yeah, so, Gitlab is now 650 people. We’re growing this year from 400 to 1,000 people. And one of the particular things about it, is that it’s an all remote company. So everyone works from the location they prefer. Most people work from home, but we also pay for an office. But there’s no shared offices where people congregate. So we work using Zoom and Slack and Google docs and a whole lot of Gitlab to collaborate across more than 50 countries.
Harry Stebbings: I mean, I absolutely love that structure and this is such a novel chance to me to deep dive on it. So I hope that’s okay. But when we chatted before, you said transparency and iteration are key for working across time zones. You left me hanging there. So what did you really mean by this transparency and iteration and how does that play out so successfully?
Sid Sijbrandi: Yeah, the hardest part from working across time zones is that it needs to be asynchronous. You have to be able to collaborate without being in a meeting at the same time. So iteration helps, because you bite off smaller things. So iteration means reduce the scope to a smaller thing, but do it really quickly. And get it out there, get it in the market. And the smaller the thing you do, the less coordination it requires.
Sid Sijbrandi: If you’re doing a six month thing, you better make sure that all the departments across the company are bought into that. If you’re doing a two day thing, you can just do it, release it. If it’s not exactly the right direction for the next step, you can take that step in a slightly different direction. So you’ll get feedback much more easily. So iteration reduces the coordination costs and it’s a core value at Gitlab.
Sid Sijbrandi: The other thing is transparency. You want people to be able to work without shoulder tapping. If you need to ask someone for something, not only does it interrupt both the sender and the receiver of the information, but also it’s just not possible. If that person is not working at that time, you can’t do it.
Sid Sijbrandi: So at Gitlab we write a lot of things down. We have a handbook, it’s public and creative commons, so lots of people are copying from it and being inspired by it. And it’s over 3,000 pages and it contains many of the things you would normally not find documented at other companies.
Harry Stebbings: Next we have Dylan Serota, founder and CEO at Terminal, on why we should maybe think about embracing geographically distributed teams earlier in company lives.
Dylan Serota: I think simply building a company in one market like Silicon Valley is harder than ever before to sustain. In fact, I think it’s unsustainable for 99% of the companies out there. Talent is obviously the most precious resource for a technology company. And being isolated in one market actually poses massive long term risks to a company’s ability to compete. Especially with high attrition rates of employees. Or the risk of a new overnight unicorn that can take up significant portion of the talent from the ecosystem.
Dylan Serota: So, we believe geographically diversifying or building teams across multiple markets is a muscle memory that you should start building much earlier than conventional wisdom would suggest. And we’re seeing companies now do that on day one, or with employee number one. And I think that trend will only continue to be the norm.
Dylan Serota: And we’ve spoken to companies that wait to do this much later when they have 50/80/100 engineers. And that’s much more difficult to actually re-engineer your practices and divisions of responsibility. Or you now have a data tech stack that makes it increasingly hard to find engineers that are actually excited to build upon the technologies you’re using, that may just be a few years behind the modern trend.
Harry Stebbings: No, absolutely. It seems so much easier to insert that kind of culture and discipline from day one. I promise this isn’t a Lightspeed advert though, but I did speak to Nat Ore before the show, and he said then, with that in mind and the benefits you just posited, what are the key aspects to making remote teams successful?
Dylan Serota: So there’s many aspects here. I think first, market selection is key. So, understanding where you want to take your team and the right place for that team to grow. And there’s a lot of factors that go into that. In terms of talent, how big is the talent pool? Who are the incumbents in the market with large engineering teams? What technologies are popular in that city or that region? What universities are local there that could feed into the long term potential talent pool? How aligned are time zones? How easy is travel?
Dylan Serota: So, there’s a lot from overall market selection, but from a team standpoint, there’s no question that you need strong initial leadership for that team to be successful. So hiring the first senior tech lead is critical. It doesn’t have to be the first hire, but I think it does need to be in the first few to establish a strong foundation for that team. And allow that lead to start making some of the hiring decisions with local knowledge of talent on the ground.
Dylan Serota: And lastly, and I think a very important factor, is making that team feel like first class citizens. And this really stems from giving complete product ownership to that team. And not just thinking that they’ll fix bugs or work on lower priority items. And doing that early on gives that team, I think, a vote of confidence from headquarters. That they’re equal contributors, which is very important in establishing trust across the offices.
Harry Stebbings: Before we discuss the conventional problems that are often associated. One, for me, that I always get concerned by is just seamless lines of communication. What have been your learnings on ensuring seamless communication flows between distributed teams?
Dylan Serota: So, one of the, I think, most important factors is time zone alignment. I think what we’ve heard from feedback is, the more hours that you have to synchronously communicate, whether that’s over Slack or other tools and systems, that’s one of the most important factors. And then obviously I think that we’re at this stage in time where a lot of those technologies are just being adopted, whether it’s in your core office in San Francisco or when you’re making a concerted effort to establish new channels and new pathways.
Dylan Serota: The other thing I think most companies need to change is just overdocumenting or increasing the documentation that they have of decisions that are being made at various meetings and points. And having a repository where someone could look back and see the timeline of those decisions. Those are really helpful.
Harry Stebbings: Yeah, no, I love that transparency. But the common pushback I also get, is the detrimental impact on culture for having distributed teams. But when we chatted before, and I love this quote, you said companies overvalue their culture. What makes you say this and how do you think about culture across remote teams?
Dylan Serota: Yes, and to clarify what I mean by that, it’s that companies overvalue the culture they have today. And undervalue the culture they can evolve into and create in the future. So, this was a big lesson for me from Julia Hartz at Eventbrite. That culture should not be stagnant or overly preserved. It should evolve with the team that you build. A real bottoms up approach.
Dylan Serota: And as that relates to building remote teams, I think companies need to understand that as much as they want to just export their culture to new markets, they really should be equally importing culture from that market into headquarters.
Dylan Serota: I’m not sure who said it, or coined the phrase, but I really like it, is that culture is a verb, not a noun. And I think that’s very much the spirit of what I believe in. And what can ultimately build longer term strength for a company with respect to culture.
Harry Stebbings: Now we have Rachel Carlson on why she made the move with her company Guild from San Francisco to Denver.
Rachel Carlson: Sure. So, when we were starting Guild, it was a handful of us. We were working on Stanford’s campus and had a small office in San Francisco. But we knew we needed to make two big sets of hires in our coming year. One was the product and eng team and two was our first group of coaches who work directly with our students. And you can think of them as half of a inside support team and half a retention team.
Rachel Carlson: And so the starting advice was, keep your leadership and your tech team in San Francisco and have everybody else go somewhere else more affordable. But I thought that was bananas because I needed our product team to be constantly working with our coaches to build the right product that they would use and that our students would use in interaction with one another.
Rachel Carlson: And so I had a strong conviction that leaving San Francisco was the right move. I’m from Denver, so it candidly had a running headstart, but we did look at a handful of other cities. And what I ultimately decided to do, because our investors were pretty nervous about this in 2015, was I posted the job description in Palo Alto, San Francisco and Denver.
Rachel Carlson: And lo and behold, the far and away best candidate was out of Denver. It happened to be also a female director of eng, Jess Rusin, who today is our SVP of engineering. And when I put the resumes in front of the investors, it was so clear to them that if we could find a director like that, imagine the team she could bring. And her references were so off the charts everyone said they would follow her wherever she went.
Rachel Carlson: And so that was the first notch in proving how we could do it and why we should make the move. But it’s been the best choice we’ve made to make sure that we’ve kept those two teams together. And that we’ve grown both product and engineering in the same place that we’ve grown our customer support.
Harry Stebbings: It’s so interesting to hear you say about the benefits of hiring there in Denver, because whenever I talk to people outside of the core tech hubs, they always say, oh, we have to hire people from them or talk about the challenges of it. Why do you think there is this misconception then that you have to be in the tech hubs to hire the best talent? And how do you push back against that?
Rachel Carlson: So, you just have to think about it as a different funnel. So I think in San Francisco the funnel is very, very wide. But your chance at winning, at the bottom of the funnel when you’re an early stage company, is incredibly hard when you’re competing with Google and Facebook salary packages. In Denver, it’s a narrower funnel, but we win at the bottom of the funnel. Always or nearly always. And so it’s just a different equation. I also think in Denver it’s worth noting, you can also recruit a lot of people to move here. And a number of our leaders have moved specifically here. And now more and more of our employees in general are actually moving to Denver to join the company.
Harry Stebbings: In terms of tactics around location for companies, I often do see leadership teams in San Francisco, and then the rest of the teams now more and more in Austin, say, and many other different parts of the US. How do you feel about that split tactic, with the leadership team in one place and then eng and sales and marketing, maybe, in another, how do you think about that?
Rachel Carlson: So, I think that that’s not a great idea. I think there are, and I’ll be controversial about it, I guess, I think there are three groups of people you can live near. You can live near your employees, you can live near your customers, or you can live near your capital. And my argument would be that it is far more important that you live near your employees and you live near your customers, than living near your capital. And I think Guild’s been a testament to that. And I’ve been able to have fantastic relationships with our investors without living in the same neighborhood as them.
Harry Stebbings: Now we have Eric Christopher, founder and CEO of Zylo, on how being outside of the Valley impacts or maybe doesn’t impact fundraising ability.
Eric Christopher: There is no question to disadvantages, I would say, but they can be overcome, you just have to put in a plan and execute it. And when we raised our series A, one of the investors I talked to that lives in the Bay area, had asked me like, hey, are you going to rent an apartment out here for a month or two and bring the family and come raise and stay out there? And I think the real reality is, is that you have to, first off, it’s like there’s going to be a certain profile of investor that likes, and maybe even prefers, to invest out of the Bay area. There are some that love that.
Eric Christopher: And there’s many also that are really just, and even told me directly, they just really want, there’s enough opportunities and investments to make in the Bay area. And they just kind of stick there and that’s fine too.
Eric Christopher: So the key is that you have to run a real process where you talk to a lot of investors and kind of shake out profile of fit of people. I want an investor that wants to come and build the company. Support the technology community in Indianapolis, Indiana, where we’re based. And Byron was one of those individuals.
Eric Christopher: I also think that the kind of always fundraising and relationship building is really important. So every time that you’re in, that I travel to San Francisco or New York or other markets, typically I’m meeting with investors to build relationships to kind of find those attributes out, if some of them wants to invest out of the Bay area.
Eric Christopher: So, it’s certainly something you have to overcompensate with when you’re not able to just grab a coffee down the street with most of the investors that are in the Bay area.
Harry Stebbings: Can I ask, is it actually not also quite helpful to be outside of the Bay area for the always be raising because then, at least there’s real deliberate intention to your meeting with investors. Even for a coffee where they’ve deliberately sought you out, it’s booked a long time ahead with your dates for that trip. Compared to wasting endless hours just because an investor’s in the next door block and it works and is much more haphazard.
Eric Christopher: Yeah, that’s a good question. I do think that because we’re not there every day, that when we are in town, it’s maybe a bit more of a special opportunity to meet us and see what we’re building and stuff like that.
Eric Christopher: And one thing I would say too is that, as much as like, I just mentioned how you might have a Bay area investor that’s not interested in investing maybe in the Midwest or something like that. All of them have generally been helpful and are willing to meet and give me great ideas about the business and things like that.
Eric Christopher: So I think that generosity of time and things like that, because that’s so hard for everyone. Everyone’s so busy that the fact that I’m not there every single week and a day helps to get some of those meetings.
Eric Christopher: So, I tend to have a lot of luck through the network of someone being interested in learning about our business for sure.
Harry Stebbings: So we had Sid discuss being an all remote team with Gitlab earlier. Well, now we’re hearing from Jeppe Rindom, founder and CEO of Pleo, on why they have a part remote structure.
Jeppe Rindom: Yeah, so we 106 people and I would say we roughly have 25 people that are working remotely. It’s mostly engineering, I would say. And it’s worked really well for us. I mean, we haven’t really had, I would say hardly any churn in our remote workers. So we’ve somehow found a formula that has worked, even our engineering leadership team is remote.
Jeppe Rindom: I think there are the more though, practical things like, you need to have your mics every room, your 360 degree cameras, you need to have your meeting hygiene in place so that it works with everyone’s time zones and stuff like that.
Jeppe Rindom: And then I think there’s a little bit about the culture in the company as well. We base a lot of stuff on both trust but also transparency and we communicate everything and we encourage people to participate across teams and so forth. And I think that becomes even more important if you’re fully or partly remote.
Jeppe Rindom: And then I would say the last piece, you can never replace the human touch and the human interaction in person. I think it’s very difficult not to have that at all. At least, if you hit choppy waters, I don’t think the loyalty with your remote workers will be as strong if there is no human relationship in place. And the way we do that is, we make sure to bring people together four times a year. And they also spend their first month in the office here in Copenhagen. And when we are together we make sure that we really push a lot of social activities. And we make sure the remote workers and everyone else is exposed to each other across teams, etc. And I think that is just super, super important if you want the same sort of engagement everywhere in the company.
Harry Stebbings: Can I ask, I’m a bit of a geek when it comes to the optimization of processes, what tools do you actually think’s critical to really enable the team who works remotely to coordinate seamlessly with the team in the office? What does that look like today for you guys?
Jeppe Rindom: I would say for meetings and stuff like that, we’re in love with the Owl, which has the sound sensors and 360 degree cameras and microphone because it works just really well and it’s cheap. And we use that in the meeting rooms and Zoom everywhere so you can connect to any meeting room.
Jeppe Rindom: For communication, we still use Slack, it has pros and cons but I think it works for us if you have the right hygiene around it. And then be mindful that the remote workers here are mostly engineers, and I think working remotely works quite well in engineering, because there’s even benefits of different time zones with code reviews and so forth, so you can almost sequence your day. And with code reviews and GitHub and all the that kind of stuff, it’s almost designed around remote working principles.
Jeppe Rindom: I would personally be a little bit more reluctant when it comes to stuff like sales, at least in a fast moving sales environment. I think we have a lot of benefits from having a good sales culture in the same room. Because it’s just, we get a lot out of a little bit of music and having power hours two times a day where everyone stands up and they do their prospecting call out and stuff like that. And I think that kind of culture is a little bit more difficult if it was remote. So that’s why we focus a lot on engineering.
Harry Stebbings: Now I have to say I did so enjoy collating some of the views from the best people in the industry on the subject of location and whether to go remote. Now I would love to hear your thoughts though.
Harry Stebbings: If you enjoyed this episode and this kind of a thematic approach, do let me know. Or if you have any other feedback, you can find me on Instagram at hstebbings1996 with two Bs. It’d be great to hear your thoughts there.
Harry Stebbings: As always, I so appreciate all your continued support, it really does mean so much to me, and I can’t wait to bring you a brilliant episode next week.