The Creator John O’Nolan makes a big deal out them being not-for-profit in the promotion video for Ghost:
- “Made for love and not for profit”
- “Do we want to make millions and sell to Facebook or do we want to make something that’s genuinely good and serves its users and not its investors and shareholders?”
- They’re not-for-profit which “affects their motivation”
This just pisses me off. Making money and profit is good and powerful. John seems to believe it’s a binary choice:
- Profit or Passion
- Profit or Quality
- Profit or Integrity
This is naive. Profit is an enabler. It’s usually (not always) an indicator that you’re doing something that your customers really need, at a price point that makes sense. Profit gives an organization the ability to iterate faster, reach more people and beat subpar competitors. And most importantly, stay in business.
We’re working hard at reaching profitability at Treehouse because we want to build a lasting and impactful business that’s still changing lives in 100 years. This takes money and lots of it.
It’s bizarre that John says it’s wrong to serve investors, while simultaneously soliciting investors on Kickstarter. A healthy relationship between companies and investors is one where the investors want an amazing experience for customers, because it changes the world and makes them wealthy.
That’s what I love about our investors at Treehouse. They want us to be wildly profitable because it means that we are changing millions of people’s lives around the world, which in turn will make them money.
If you have shitty investors, then of course they’ll try to maximize the return on their investment and then discard you. Good investors though, can be truly empowering.
Entrepreneurs: Don’t listen to the “must be not-for-profit if you want to change the World” bullshit. The folks who figure out how to build a truly profitable and lasting company will be the ones that really change the World.
Recently we tried something new at Treehouse and it’s working wonderfully well, so I thought I’d share the secret with you.
We recently crossed the invisible it’s-impossible-to-communicate-effectively line. The strange place where it feels like you’re small enough as a company not to have ‘communication procedures’ but large enough that somehow everyone is no longer on the same page (and misinformation spreads like wildfire). For us, that number was around 30 employees. We’re at 53 now, so it was time for a new strategy.
Previously, we used Campfire as our ‘water cooler’. The place we’d hang out and chat about stupid stuff, random news, celebrations, etc. This was really important because we have a distributed team across the World, so we couldn’t rely on physical interactions to boost morale and communication.
The problem is that if you miss a conversation in Campfire, it can be difficult to go back and figure out what happened. The lack of threading, comments and up/down votes makes it very difficult to decipher what’s worth reading and what’s just random banter. Everything has the same importance in a chatroom.
In an email thread about this issue, Jim brought up the idea of building an internal Reddit-clone. He cranked it out in a couple days, called in Convoy (because the movie is full of awesome) and here’s what it looks like …
The idea is simple: If it’s not actionable or urgent, post it to Convoy. Here’s the general guidelines:
- Phone or Google Hangout: Need an answer immediately
- IM: Need an answer in the next hour
- Email: Need an answer in next day or two
- Convoy: No answer required
Jim even built in a bit of gamification with points and user activity streams …
We still use Campfire for quick banter that’s too transient for Convoy. The Developers and Designers live in Campfire and really use it as a hive-mind. The rest of us though tend to abuse Hubot a bit in Campfire but leave the real discussions and random posts for Convoy.
We don’t have any rules about having to check Convoy or Campfire. It’s all about how much each person wants to stay connected. If they’re feeling out of the loop or disconnected, Convoy is a fun and easy way to jump back in.
Now that we’ve been using Convoy for a couple weeks, I definitely feel a palpable difference in the company culture. We’re more connected and everyone is having a chance to weigh in on discussions. Previously, you’d see these huge email threads about topics that may or may not interest you. Now email is less noisy and a lot of the discussions are happening in Convoy. Email is preserved for actionable items, which is great.
In conclusion, I’d highly recommend using an internal Reddit-clone so that your Team has a chance to discuss non-urgent/non-actionable topics or just offer encouragement or distraction. We love it.
I think this is a great place to take a stand and say you don’t need to be in Silicon Valley (or a “startup hub”) in order to raise money for your startup or be successful.
Paul Graham and I had a disagreement about this when he did a talk titled The Future of Web Startups at our conference in 2007. Afterwards, he summarized his thoughts on our interaction in his post Why to Move to a Startup Hub. That post is 5.5 years old now so I’m not sure what his current thoughts are. Paul and I are frienemies because we respect each other, but have different opinions on a few key issues. This post isn’t meant to be disparaging to him.
I hope that the following facts will be one counterpoint to the “You’ve got to move to a Startup Hub” message. Treehouse has …
- Raised over $12,000,000 in capital from some of the World’s best investors (Chamath Palihapitiya, Kevin Rose, Reid Hoffman, David Sze, Greylock, Mark Suster and Kaplan)
- Acquired 25,000+ active and paying Treehouse Students
- Grown to a $5m yearly revenue run rate and growing fast (18% top line growth last month alone)
- Hired 55+ employees distributed across Orlando, Portland and the rest of the USA (and one in the UK)
- Established a 4-day work week
- Received coverage from national news media
One of our core values at Treehouse is “We do it our way” and this fits nicely in with that.
Startup Founders: Don’t be afraid to do it your own way.
The current popular belief among the startup community is that it’s necessary to have a co-founder in order to succeed. In my experience, this has not been true.
Paul Graham, the Co-Founder of Y Combinator, said you need a co-founder in his 2006 essay, The 18 Mistakes that Kill Startups
Have you ever noticed how few successful startups were founded by just one person? Even companies you think of as having one founder, like Oracle, usually turn out to have more. It seems unlikely this is a coincidence.
What’s wrong with having one founder? To start with, it’s a vote of no confidence. It probably means the founder couldn’t talk any of his friends into starting the company with him. That’s pretty alarming, because his friends are the ones who know him best.
But even if the founder’s friends were all wrong and the company is a good bet, he’s still at a disadvantage. Starting a startup is too hard for one person. Even if you could do all the work yourself, you need colleagues to brainstorm with, to talk you out of stupid decisions, and to cheer you up when things go wrong.
The last one might be the most important. The low points in a startup are so low that few could bear them alone. When you have multiple founders, esprit de corps binds them together in a way that seems to violate conservation laws. Each thinks “I can’t let my friends down.” This is one of the most powerful forces in human nature, and it’s missing when there’s just one founder.
David Cohen, who runs TechStars (another tech incubator) had this to say in response to this question in 2010: “What are the chances of a single founder getting accepted in the TechStars Program?”
Low. We’ve done it two or three times out of 70 companies we’ve selected. If there’s a strong team around the single founder, it’s much more likely. If it’s really just one person, TechStars is probably not the place for that person - there’s too much to do for one person in a short period of time. [link]
I believe Paul and David are stressing the importance of co-founders because they’re talking about young founders with no previous business experience. It’s important to remember, however, that they are investors, who are maximizing their returns. Just because they say it’s unlikely that you’ll get into Y Combinator or TechStars as a single founder, doesn’t mean you need a Co-Founder to succeed.
I have thankfully had good success with Treehouse, as a single founder. We’ve grown from three people to 54, and $0 revenue to $3.4m+, all in just two years. I funded the business with cash from my previous business and grew it to profitability and then decided to raise a seed round of $600,000 so we could hire faster. I didn’t ask any of my friends or contacts to be Co-Founders.
Here are the reasons why being a single founder worked well for me …
1. More Equity and Control
We’ve raised over $5,000,000 for Treehouse so far and I still own close to 70% of the company. I also control the Board. If I had a co-founder, I would likely own half that equity and I wouldn’t have complete control of the Board. Equity and control are two extremely important issues and starting with co-founders immediately diminishes your personal control and equity stake.
2. Strong Leadership
I’m a big believer in CEO Founders who maintain control over their companies. Jeff Bezos and Mark Zuckerberg are great examples.
As long as the CEO Founder can adapt to the changing needs of his team as the company grows, they are definitely the best to steer the ship towards their goal. Once they lose control of the Board, I believe the ship can veer off course.
This is also why I don’t ever want to take Treehouse public. I hate the idea of having to answer to outside investors who don’t have day-to-day knowledge of the challenges and opportunities we face. They also don’t share the insane passion that I have for the business.
3. Single Life Goal
I’ve personally seen two startups disintegrate because of different life goals between Co-Founders. Each Co-Founder has their own agenda and picture of what success is. The following issues can be very divisive between Co-Founders:
- Pay - When do we start paying ourselves and how much?
- Work Schedule - How many hours do we work per week? What if someone is working harder/longer than the other Founders?
- Liquidity - What if a buyer comes along and offers you $1m for the company, but one of Co-Founders wants to hold out for $10m in a couple more years?
- Power - Who is seen as the driving leader in the company? What if there’s a clash among Co-Founders?
- Location - What if one of the Co-Founders is getting pressure from his or her partner to move or change their living situation?
Running a company with Co-Founders is like getting married. It’s an insanely serious commitment yet folks just blindly wander in and believe it’ll all work out.
4. Promote from Within
I promoted Alan Johnson, our first Developer, to a powerful position where we effectively lead the company together. His role is similar to a CTO.
If I’m so gung-ho about not needing a Co-Founder, then why have I done this? Well, because it is hard to run the company alone, long term. It’s very valuable to have day-to-day feedback from a trusted and knowledgable colleague. That person needs to know everything about the business so that you can share your worst fears about the business and what’s stressing you out. This person needs to feel completely comfortable disagreeing with you, and telling you about it.
I promoted Alan to this role after working together for over a year. This gave me time to watch him work and make sure our styles, life goals and personalties matched up. He got an increased amount of stock options when he was promoted, so it’s a big win for him as well.
In Closing …
So based on my experience, it can be optimal to be a Single-Founder. Don’t blindly accept the rhetoric of industry leaders about needing a Co-Founder.
Please share your opinions and experiences in the comments - thanks!
Yesterday I sent out an email to the whole Treehouse Team:
We’re growing fast which is insanely exciting. However, one of the bad things that happens as a company grows is ‘title creep’. Things like ‘Lead’, ‘VP’ and ‘Director’ turn into ‘SVP’, ‘Lead Director’, etc. It’s bad as it causes confusion and bad feelings.
At Treehouse we’re simply going to have three job titles:
- Team Leader
- Sub-Team Leader
- Team Member
Generally, people can manage 5 - 15 people, and then things start getting out of control. If a Team grows to over 15, then someone in the Team might rise to become Sub-Team Leader. The person that’s right for that role will usually rise to the position naturally because they enjoy leading and are good at it. Right now we don’t have any Sub-Team Leaders as the Teams aren’t big enough yet.
If you need to use a job title, please go with this pattern: ‘Job - Team Name’ or ‘Job - Sub-Team Name’. Examples would be ‘Team Leader - Sales Team’, ‘Designer - User Growth Team’ or ‘User Growth Team’.
I’ve created a drawing to help everyone understand how the Teams relate and who’s leading them.
Here is a public version of the Team Chart.
I had made the mistake of giving people management titles because they were the first person to join a Team. Now everyone starts off as just ‘Team Member’ and then if appropriate, they get promoted to Sub-Team Leader or Team Leader.
I got the idea to have three job titles from Tom Katis, the CEO of Triple Canopy, a security company with 7,000+ employees. I met him at Founders Forum and told him how our company was growing very fast and I was dealing with interesting new challenges because of the growth. One of challenges was structuring the Team for success and removing unnecessary friction.
He served in Afghanistan for the US Military and then started Triple Canopy. He took what he learned from the management structure of the armed forces and applied it to his company. I thought it made a lot of sense, so we’re now implementing it at Treehouse.
Please share your thoughts on how you deal with this at your company.
Brad asked a great question that I’d like to tackle …
@ryancarson Would love to hear about hiring employee #1 on your blog. When is the time? Who to look for? How did you go about it?— Brad Touesnard (@bradt) July 2, 2012
When is it time to hire your first employee?
This will be determined primarily by profitability and cash in the bank. I’d recommend waiting to hire your first employee until you’ve …
- Built up at least three months of cash in the bank. Take all the company’s monthly expenses (include your salary as the owner) and multiply by three. Eventually you want this number to be 12 months, but that’s a lot harder to do.
- Reached net profitability each month. You can squeeze by with just breaking even, but it’s a good idea to be generating a few thousand dollars of net profit per month before you hire that first person.
If you’ve raised angel or venture capital, then you can ignore these two things and hire right away. That’s the point of raising money after all - go faster than normal cashflow would allow.
Use freelancers first
One thing that has always worked really well for me is to hire a freelance designer and developer to build the first version of the product.
This allows you to budget a certain amount to reach MVP and avoid the extra costs of hiring full time (pension contributions, employer taxes, health insurance, etc). You agree a fixed price for the design and the dev and then you all work towards releasing the first version of your product.
Usually, you will find these freelancers by asking friends for recommendations. Here’s how to avoid problems:
- Only use freelancers that have been recommended by people you trust. Do an initial Skype chat before you seriously consider hiring them. This chat will weed out any bad apples. Ask for two references and call or email them. Don’t skip this step even though it’s time consuming.
- Do rough wireframe first and agree on the scope of the project.
- Agree a fixed fee for the job. Pay 20% up front, 20% on completion of rough beta, 40% on launch and 20% two weeks after launch (to iron out launch kinks). Define what “launch” means.
- Insist they use your company GitHub account for the code repo.
- Agree on a retainer for maintenance and updates after launch. I’d recommend 4-6 months as this will give you time to hire someone fulltime to replace the freelancers.
- Use a Gantt Chart to track the progress of the project. This will help you see dependencies that could delay the project and cause problems. I use Team Gantt and it works great.
Hiring Employee #1
Once you’ve taken care of having enough cash in the bank and hitting net profitability, then it’s time to think about hiring your first person.
I’d recommend waiting until you’re overwhelmed with your work. You should be doing all the customer support and marketing yourself (and the design and dev if you didn’t use freelancers) in the beginning. Once it’s clear that you can’t keep up, it’s time to hire your first person.
I’d recommend your first employee should be a designer with strong frontend dev skills. Do not hire a customer support person. The founder should always do customer support until it becomes impractical (too much volume to respond within 12-24 hours). A good designer/frontend dev will allow you to iterate quickly on the project and optimize sales funnels and UX problems.
You’ll need to research market rates for salaries so you’re clear about how much this person will be paid and what they’ll be doing. I usually do a bit of Googling and chatting to friends to get an idea of the salary range.
By the way, be generous with your benefits. It sends the right signals to potential employees and it builds a strong relationship with your Team. It also makes it easier to recruit.
Your employees are hugely important and it’s important to not cut costs on their benefits. They’ll be plenty of places to be frugal, but employee benefits are not one of them. I knew a company that bought their employees iPhones (yay!) but then asked for them back when they left of were fired. Stupid move. Any goodwill that was built instantly evaporates.
To find your first employee, I’d recommend using the following methods:
- Friend’s recommendations - Ask trusted friends if they know anyone who’s looking for work. This is how we find 80% of our employees.
- Job Boards - We use 37signals and Authentic Jobs primarily
- Twitter and our own blog
Warning: Avoid hiring a friend as a first employee. As soon as you hire them, you become their boss which means the dynamic changes. You control their salary, schedule and ultimately you may have to fire them.
Once you start receiving applications, I’d recommend following a process like this.
Choosing the right employee
Your first employee needs to have the following traits …
- Flexible - Can do a number of different tasks and doesn’t mind jumping in and helping out in things that aren’t related to their job role
- Proactive - Someone who will actively look for problems and fix them without being asked
- Affordable - You shouldn’t hire someone who’s overqualified because they’ll be too expensive
- Enjoys change - As the company grows, this person’s role will change several times. Constant change needs to be fun for them, not stressful.
- Non Corporate-y - Don’t hire someone who wants a predictable career ladder to climb. Their role will change a lot and you can’t predict where they’ll be in 12 months.
Spinning them up
Once you pick someone as your first employee, use outsourced HR. We use TriNet and love them. This will ensure that the employee is paid consistently and fairly, taxes are accounted for, employment laws are followed, etc. Proper HR is a real time-suck, so it’s smart to outsource this. We now have 50 employees at Treehouse and we still use Trinet.
Important note: Don’t give your first employee a ‘Manager’ title. This will be tempting as they’re the first person on the Team. However, it’s impossible to know if they’ll be capable of leading the team as it grows so it’s best to just stick to something simple like ‘Designer’ or ‘Developer’. If that person kicks ass, then it’s easy to promote them to a leadership role later.
Clearly communicate your expectations on …
- Working hours
- Salary range and how you advance
- Responsibilities and deadlines
- Tools (todos, email, project management, etc)
Good luck! It’s exciting and scary to hire your first employee, but you can do it. Once it’s done, the real adventure begins :)
Please share your thoughts about hiring your first employee below in the comments!
I got a great question from Sahil …
@ryancarson can you blog about how you spend your day running your biz? What biz activities do you focus on now that the product is up?— Sahil Parikh (@sahilparikh) June 26, 2012
Monday - Thursday
- 4:54 AM - Wake up. I use the ‘Crickets’ alarm on my iPhone and turn the volume down to 1.
- 5:00 AM - Eat a cold slice of chicken or ham. Make a coffee or mix up a Goodness Greens glass. Eating right away starts my metabolism and gets my body burning calories. Goodness Greens is just more green veggies in my system, which can never be a bad thing.
- 5:05 AM - Make a point of appreciating all that is good about my life, instead of immediately rushing into my day. I often take a deep breath and sit out on our deck for a few minutes.
- 5:10 AM - Sit down at my iMac and open up Chrome. Three tabs auto open: Trello, Google Calendar and Team Gantt.
- 5:10 AM - 5:30 AM - Go over my todos in Trello and allocate things to my ‘This Week’ list. I wrote a detailed post about managing my todos if you’re interested (see #2).
- 5:30 - 7:00 AM - Examine our company road map in Team Gantt. I’m a big-picture person so I need to see the overall goals, if we’re missing anything and how we’re progressing. This is a deep-thinking session. I need the quiet of the morning to completely focus on this. I believe this is one of the most important jobs of a CEO.
- 7:00 - 7:30 AM - Bring coffee up to my wife Gill (who’s just waking up) and sit in bed and chat while the boys run around for a bit. I love this time.
- 7:30 - 9:00 AM - Shower, eat breakfast and prep the kids for their school
- 9:00 - 9:30 AM - Crank through todos
- 9:30 - 11:00 AM - Hop on my bike and head to the gym. I work out for an hour and the bike ride takes 15 minutes either side.
- 11:00 AM - 12:00 PM - Meet with Alan, our Chief Product Officer and plan out the tasks for the Product Team for the week. We also chat about Road Map and make adjustments accordingly. As the Founder and CEO of Treehouse, I really need this time to bounce ideas, fears and questions off someone. This meeting with Alan is great for this.
- 12:00 - 12:30 PM - Lunch with Gill and the kids (I work at home)
- 12:30 - 3:30 PM - Crank through todos or do meetings
- 3:30 - 4:00 PM - Product meeting over Go to Meeting. These often involve UX discussions and wireframing
- 4:00 - 6:00 PM - Finish more todos or meetings
- 6:00 - 7:00 PM - Put the kids down to bed. Put them in the bath and then read stories. I love the stories part. We’re starting to read fun books now like Trouble for Trumpets (my favorite book of all time).
- 7:00 - 10:00 PM - Dinner with Gill and chill-out time. We often watch TV or spend time reading books or blogging.
- 10:00 PM - Hop in bed and try to not get sucked into reading blogs on my iPhone (I use Reeder).
Most of my work days are like this. There are slight variations on the other days based on when I work out (Mon, Tues and Thurs) or what meetings I have.
I usually meet with one of my managers on each day …
- Monday: Product
- Tuesday: Video and Teaching
- Wed: HR and operations
- Thursday: Sales and Marketing
On Thursdays we also have a meeting with the entire management team, which is around six or seven people and we do this over Go to Meeting. We each go through what our teams are working on to make sure everyone is on the same page.
We used to do a company-wide meeting on Mondays but it got unworkable over Go to Meeting, once we hit 25+ people. I think the whole company needs to hear from me more often though, so I’m thinking about sending a video update every week to the entire company so they know what’s going on in the big picture. I’ll probably just record that with Photo Booth on my iMac.
What I focus on
When Treehouse was <25 people, I actually did a lot of execution. I’d write newsletters, sketch wireframes, answer support emails, start marketing campaigns, etc.
Now that we’re about to hit 50 full-time employees, I spend all my time ‘steering the ship’. Essentially thinking about our Road Map, checking on growth, communicating our Mission, researching solutions and managing people. I’d say 80% of my time is doing meetings and talking to people now.
That’s me! Would love to hear about your schedule in the comments.
If you’re a CEO, Founder or Business Owner, you might enjoy these blogs. I read them religiously.
- A VC - The blog of Fred Wilson, one of the Partners at Union Square. A legend in tech venture capital.
- Hacker News top 50 - Only stories that have 50+ points on HN
- Ben’s Blog - The blog of Ben Horowitz, one of the Partners at Andreesen Horowitz. Another very smart venture capitalist
- Both Sides of the Table - The blog of Mark Suster. A brilliant entrepreneur and Partner at GRP
- Mr Money Mustache - “Early retirement through Badassity” - Packed with interesting personal finance ideas
- Paul Graham’s Essays - Long-form posts from the creator of Y Combinator, one of the first modern tech incubators
- 4-Hour Work Week - The blog of Tim Ferriss, the famous life hacker
- Only Once - The blog of Matt Blumberg, CEO and Founder of Return Path
- Smashing Magazine - Interesting insights and ideas for web pros
- Seth’s Blog - The ever-insightful blog of Seth Godin, marketing extraordinaire
- My Tiny Plot - My wonderful wife’s blog about vegetable gardening
Please share your faves in the comments below.
I received another great question from @softwaregravy
@ryancarson I’d love to see a blog post on when to walk away from something in progress. When do you pull the plug? cut your losses?— John Hinnegan (@softwaregravy) June 11, 2012
I’ve started five products. Two failed, two were acquired and one is active (Treehouse).
Why did two products fail and when did I pull the plug?
FlightDeck: 2004 - 2005
In this post I’m going to focus on my first app called FlightDeck. I built it in PHP and funded it with three months of savings. I quit my full time job as Lead Developer at a web shop and sailed into the unknown.
FlightDeck was a product for sending large design files to clients for approval, when email attachments were usually limited to 2MB.
It was a SaaS solution that was priced at £199/mo. I put my Sales Hat on and tried to sell the thing. It was hard going.
My first customers came from my connections that I had built up over several years of networking in the web design industry. They took my calls because they knew and liked me. The product solved a real need that design studios had so they were willing to give it a try. Once they started using it they had client lock-in, so they usually wouldn’t cancel.
The trouble is once I used up my connections I had to try to sell it to strangers. I failed miserably at this for two simple reasons: I hate rejection and I’m a little shy (hard to believe, I know).
I made a chart on the wall with the number of current customers (six, yay!) and a goal number of 20. I stared at that thing and procrastinated picking up the phone for as long as possible. I worked from home by myself so I didn’t have any external motivation. It all had to come from me.
I remember I started taking longer and longer lunches which occasionally turned into watching films.
Clearly the business was headed for trouble and it was time to make a choice:
- Leave the price high, man-up, and deal with large amounts of rejection (but celebrate the higher value sales)
- Hire a good salesperson
- Increase marketing spend
- Drop the price and introduce a freemium model
- Raise funding to give us more runway to find product-market fit
- Kill the product and move on
I knew I couldn’t change my nature, so #1 was out. I couldn’t afford #2 or #3. Option #4 would take too much dev time to execute and I would run out of money. Option #5 made me feel really nervous because I’d never raised money before and had no idea where to start.
After a lot of soul searching I decided to take Option #6 and kill the product. I could’ve figured out a way to make options 1-5 work if I truly believed in the product and it’s mission. Deep down though, sending large files wasn’t something I was truly passionate about.
I wanted to cry. I had made cashflow models showing how we’d be doing millions of revenue by year two and crushingly, I had to admit it was a fantasy. Totally disconnected from reality.
Worse, I had to admit to my wife that I failed. I couldn’t even pay my half of the mortgage. I remember the conversation clearly. We were standing in the doorway to our kitchen and I said something like “It just isn’t working. I’m so sorry.” She was very understanding and supportive but I’m sure she was frustrated and disappointed.
Once I made the decision to shut the app down we focused on the idea of running workshops for web designers and developers. I got the idea from 37signals “How we built Basecamp” workshop. We ran our first workshop on “Building Enterprise Web Apps with PHP” taught by Chris Lea and Mike Buzzard in 2005. I emailed my friends to spread the word, posted on several web design sites and thankfully, it sold out.
We scheduled a second one with Eric Meyer on CSS and that also sold out. And that was the genesis of our events business (later acquired in 2011).
In 2006 we were generating around £100,000 of gross revenue from events and roughly £20,000 of net income. We decided to invest the profits in reviving FlightDeck as a simple freemium service. We called it DropSend, hired Nick Nettleton to build it, hired my good friend Ryan Shelton to design it and launched it.
Thankfully it took off and was later acquired in 2008. (I’ll blog more extensively about that process later).
The lifecycle of FlightDeck, like any startup, was a very emotional journey. If I was able to rewind time I would’ve simply started with DropSend instead. That’s the problem though, you can’t time the markets and you can’t time your startups.
I recently asked what you’d like me to cover here on the blog. I got a great question from @tfav
@ryancarson I would love to hear about managing a remote team.— Travis Favaron (@tfav) June 8, 2012
I’ve been running Treehouse since August 2010 from my home in the United Kingdom. We started with just three people (me, Nick Pettit and Jim Hoskins) and now we’re about to hit 40 full-time employees. I’m in the UK with one other person on the Support Team, our main office is in Orlando and the rest of the Team is spread out all around the States.
I’ve managed the company for almost two years from another country with up to an eight hour time difference. We’re doing $3,000,000+ in revenue with over 11,000 paying customers and growing fast, so we must be doing something right.
Here’s how I manage the Team …
We use TriNet to do all of our HR (payroll, insurance, employment taxes and pension contributions). If I had to administer this, there’s no way I could’ve scaled the Team remotely this quickly or effectively.
Don’t do your HR in-house. There are a ton of legal requirements and logistical details to make sure you take care of your Team properly and it’s a huge time suck. TriNet costs roughly $100 per person, per month and it’s worth every penny. The UX on their web portal is terrible, but it’s very powerful and has all the functionality you need.
Hire a Financial Controller / Office Manager
We hired Rich Pettit (who happens to be Nick’s Dad!) as our Financial Controller and Office Manager. I sit 4,247 miles from our office in Orlando, and there’s no way I could run the company without a reliable and hardworking Team Member looking after the day-to-day operations.
A lot of you will think you can’t afford this person early on, and you’d be right. Don’t hire this person until you are comfortable from a cash-flow perspective. But as soon as you can, hire this person. I think Mark Suster is really smart (which is why I invited him to invest in Treehouse and thankfully he did) and he agrees.
Use Campfire for company chat
When you’re separated physically you need a place to hang out and talk about random stuff or ideas. We use Campfire and it works great. We have a bunch of different rooms setup like:
- Chiggity Chillin (company wide hangout)
- Product Team
- Dev Team
- Firehose (commits to the Treehouse GitHub repo and deploys to Production)
We use hubot to add stupid functionality to Campfire like this:
Try out different modes of communication
We’re trying out a private WordPress install with the P2 theme to help the Product Team communicate more effectively. The Team was finding that the transient nature of Campfire was bad for having more meaningful long-term discussions about Product.
So far it’s working well and we’ll probably stick with it.
Use Go to Meeting + Google Docs
Whenever we need to meet, we use Go to Meeting. We tried doing multi-person meetings with Skype and it wasn’t reliable enough. GTM has been a great solution and it was affordable ($49/mo). It doubles as a great conference-call solution for meetings with outside people as well.
We use live editing in Google Docs (especially Google Drawing) to act as a virtual white board during our meetings.
I have a Leadership team that consists of seven people who I meet with every Monday. They lead the areas of the business like Video, Teaching, Product, Sales, Support, Marketing and Finance. We do this meeting on Go to Meeting and it lasts about an hour. Each person goes through what they’re working on so everyone is on the same page. As soon as I built out our Management Team I realized we needed these meetings to keep everyone informed. I knew what everyone was doing, but they weren’t coordinating with each other.
Before we created a management team, I met with everyone in the company every week over GTM or Skype. Once we started scaling the team, this wasn’t possible.
The brutal truth is that meeting over GTM or Skype just isn’t the same as meeting in person. It’s OK but it doesn’t have the fidelity of meeting face-to-face. This is why we fly everyone into Orlando four times a year for 4-day company-wide meeting. These quarterly sessions really bond the team together and help makeup lost time for working remotely. They’re intense but fun.
We’re now using Trello for all our company projects. We switched from Asana because Trello is more visual and it’s a little easier to see how things are progressing. They’re both great tools - we just found the left-to-right kanban-style layout of Trello very easy to parse quickly. Each card is an atomic todo and you can see it moving through various stages to completion. Above is a screenshot of our actual “Product Team: In Progress” Trello board.
Now that we’re up to 40 people and things are going 110mph with Treehouse, I’ve decided it’s no longer viable to manage the team from another country. We’re still going to operate remotely as a company with everyone spread out around the US, but as the CEO I really need to be on US time.
So I’m moving my family to Portland Oregon where we’re going to setup another office for Treehouse. A lot of the team will still be remote but being closer will really help. My goal is to slowly gather Team Members in our Portland office but leave our Video Production and Teaching in Orlando (it’s affordable there and the office is established, so no need to move it). Alan, my Chief Product Officer, is moving his family to Portland as well so we can work together daily.
If you manage a team remotely, please chime in and share your tips in the comments.
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