I recently joined Automattic which is a fully distributed company. We have ~900 people (in all functions) working in ~70 countries, with no central office. We are one of the largest, if not the largest fully distributed company in the world.
I wanted to share some of my thoughts about the advantages and challenges of distributed work after two months – both strategically and from a practical implementation/execution perspective.
One very important principle about Automattic is we are set up to be a distributed company and all of our internal process is designed with distributed teams as the default state. This way, folks that are remote are not ‘2nd class citizens’ but are the core of the company.
Work from anywhere: Our people can live and work from wherever they want, which ultimately leads to happier employees that stick around longer.
Work when most productive: People can work when they feel most productive and manage energy, not time (one of my fave articles) taking into account their personal constraints (e.g. family) into their schedule. Managers, however, have a bit less flexibility.
Custom work environment: Some folks like others around, others prefer a quiet environment, others like to move around. At Automattic, people can set up their environment to suit their unique style which is very hard to achieve in a traditional office.
Everything is documented: We document everything using our internal blog system (called P2) and folks can always go back and find out the ‘why’ behind decisions. This is very powerful.
It’s worth noting that these are currently a set of initial observations for challenges, and I’m sure there are a number of good solutions to them which I’ll be actively thinking about as part of my work at Automattic.
Onboarding as a new employee: Onboarding requires getting to know the right people (and building trust), learning the right systems, and developing the right judgment to know where to focus. Doing this remotely can be a struggle.
Building relationships: It’s easier to build bonds with people in person. Nuance is lost over Slack and Zoom and there is no substitute for time in person together. At Automattic, we have meetups to help build relationships but it increases the amount of time and ‘deliberate-ness’ required to get to know your colleagues.
Finding product-market fit: In the earliest stages of finding product-market fit, iteration can be slowed down because of async, documentation heavy nature of our work especially if vision is shared among different people. This is an area where I feel there are lots of areas for opportunity to improve with more frequent synchronous interactions.
Changing direction: It’s much harder to get alignment and inspire towards a different strategic direction via text and video. It’s harder to recreate ‘energy’ and velocity in a distributed environment.
Separating signal from noise: We are a large team (900+ people) and there is a lot of content that is created daily.I’m spending about 15%+ of my day parsing through posts and comments to figure out what I should read, participate in, or make decisions on and as a new person it can be difficult to know where to focus. More experienced distributed workers have similar issues, but they are less pronounced, which shows that this is a somewhat learned skill.
Time zone management: It can be difficult to run teams across different time zones but there are also opportunities to increase velocity by folks working over a 24 hr period.
I really like the gut->data->gut framework for making significant decisions in your life which I first heard nicely articulated by Sukhinder Singh Cassidy here.
Whenever I’m at a crossroads, I always write down my gut instinct at the beginning of the decision making process. I then come up with a structured framework to collect any data and rank order options against each other along the relevant dimensions. At the end of this process I put aside the analysis and then go with my gut.
The data gathering and analysis phase is really to make sure that there are no big gaps in my thinking and to make sure that one option is not clearly better or worse than another along more objective measures.
As I’ve gotten older and applied this framework over and over again my gut instinct at the start and and the end is usually much more consistent.
This same framework is also useful when deciding what to build and prioritizing as a product manager and having to trade off features against each other.
From time to time, I have an opinion on how the world may evolve and have not found a good way to invest in these kinds of macro theses. It’s too difficult or time consuming to find public (or private) products that provide access to these types of investment opportunities.
I would love to find a platform that surfaced more niche, long tail investment strategies or figure out how to enable folks to create packages of investment products for themselves around macro theses and then offer them externally. If this could be made much simpler, we could see a decentralization / democratization of ‘funds’ and fund managers and many more niche funds/investment products that would allow investors to create much more customized portfolios.
A selection of these macro theses are below, together with how I’ve tried to invest in them (and mostly failed).
Technology entrepreneurship in Africa: I think that a number of significant companies will come out of Africa in the next few decades but the timing of when these companies will ‘hit’ is hard to predict and unclear. This is the only ‘thesis’ which I’m actually getting exposure to in a systematic way. I’m planning to invest consistently and conservatively in a wide range of sectors over the next 3-5 years and see how the market evolves through Musha Ventures.
Esports: In 2014, after spending a few years playing games like Starcraft and League of Legends I became convinced that Esports would be as big or bigger than ‘traditional sports’. There are opportunities in Esports for professional players to create much deeper relationships with their fans because of the nature of the platform (e.g. livestreaming on Twitch). I wanted to invest in ‘Esports’ at a macro level but could not find a way to get exposure at this level. One idea I had was to buy a small percentage of every large Esports team (Cloud9, FNATIC, SKTelcom etc) and use this as proxy for the Esports market without taking any individual team risk. There was no comparable product that existed and it would have done quite well over the last 5 years and still think it would do well over the next 5-10 years.
Up and coming cities: I’m short real estate in ‘mega-cities’ like NYC and London over the next 10-20 years. I think that the nature of work will change to be more distributed, and prestigious (high paying) jobs that drive up real estate prices in major cities will be more accessible from other cities in similar time zones like Nashville, Austin, Denver, Atlanta etc. I wish there was a way to invest in some sort of property index / REIT for these cities vs. buying a house or apartment in a major city where I currently live – surprisingly difficult to find.
Mental health: We have neglected mental health for too long. We have improved our tools as a species of fixing physical ailments but are still behind on mental health. There are scenarios where we, as humans, may not die of normal age related disease and can maintain younger, healthier bodies for longer periods of time. Currently 1.5% of deaths per year are driven by suicide (from Homodeus) and this will likely get worse over time. How could I best invest this macro thesis as a value investor beyond individual public/private companies – meditation, psychology, hallucinogens etc?
Meat Alternatives / Niche meat producers: I think that only very high quality meat producers of rare meat (e.g. Wagyu beef, Iberico Pork etc) will survive, albeit at a much higher price point, and the rest of normal meat consumption will be fulfilled through plant based and lab grown alternatives which will both be cheaper and better for our environment – again I can’t find an investment product for this in the public markets. I could invest in a single company like Beyond Meat but I’m looking for a basket of companies to support the thesis.
Sharing some personal news: I recently joined Automattic (makers of WordPress.com, Jetpack and WooCommerce) to help build better products for our customers. I’m very grateful to Kinsey and Matt for the opportunity.
Over the last few years, I’ve explored entrepreneurial projects and also invested full-time in early stage African technology companies. Throughout the exploration process, I realized that I missed building products and my motivation for investing was the desire to learn about new businesses and to support entrepreneurs in their journey.
I joined Automattic because the company was a great fit in a number of areas that I’m passionate about:
Decentralization of creators: Creators all over the world are able to express themselves and find audiences that are interested in their content. They now have the tools to express their voice and discover, grow and engage their audiences. Bloggers are the new authors, YouTubers are the new tv producers and Podcasters are the new radio hosts. Automattic builds tools for creators.
Empowering entrepreneurs with world-class tools: The cost of starting technology companies has come down dramatically and access to quality tools has improved dramatically. Entrepreneurs now have access to services to allow decentralized, asynchronous product development, open-sourced products they can build on top of, cheap hosting of content, and tools that allow a deep understanding of their data. These products typically have low entry costs that scale up as the businesses grow. This allows entrepreneurs all over the world to solve problems during their early stages without a lot of access to funding and without sacrificing quality. Automattic builds products to empower entrepreneurs.
Mobile-first internet users: There are billions of people in emerging markets who will experience the internet primarily through their mobile device, both as creators and as consumers. It’s a fundamentally different way of experiencing the internet compared to our reference points as adults in developed markets. There is a gap in high quality tools for mobile-first entrepreneurs and a significant opportunity to build these tools from first principles. Automattic is well placed to create this mobile experience.
Distributed work: I believe that talent is roughly evenly distributed, and enabling employees to work when they feel productive and choose where they want to live will allow companies both access to better talent and improve retention of talent. I’ve seen this firsthand through investing in tech companies in Africa that have distributed engineering teams with technical architects from abroad who collaborate with local engineering teams highly effectively. Automattic is fully distributed with ~900 people working in ~70 countries – check out https://distributed.blog/ (and Matt’s podcast) if you’d like to learn more about how we work.
I’m really looking forward to building products for entrepreneurs and creators all over the world at Automattic.
I love using tools to make myself more productive and let fewer things fall through the cracks. There are so many great (free) tools available and here are a few of the ones that have helped me the most:
Calendly:Scheduling is one of the biggest time sinks for me. Calendly allows me to share my availability (in time slots that I define) and allow people to schedule time with me without the back and forth usually required. It usually saves me 3-5 emails per scheduled call and I like it better than using virtual assistants like Clara or Byron ($200 per month each). I use the free version which I imagine would fit most people’s needs.
Streak: If you manage any kind of pipeline (sales, investments, recruiting) and use gmail, then I highly recommend Streak. I’ve used it to track potential investments, investors and for recruiting. Streak allows you to have a CRM in your inbox and also scales well to multiple users. It allows me to stay organized, have a record of interactions, and make sure that I don’t let to-dos drop. I use the free version as well, but it costs $50 per month if you’re using it with multiple people or need API access.
Gmail canned responses: I realized that I was very frequently writing the same set of emails over and over again: 1) Scheduling time 2) Making a connection 3) Product information 4) Passing on an investment. I use the Gmail canned response feature to add in the re-used content in addition to the personalized note that I send.
Facebook (FB) is under a lot of fire right now but despite public perception, I think that FB is still a great long term investment.
Sure, they’ve made many mistakes and lost consumer trust (with a certain segment of users) due to recent incidents such as Cambridge Analytica, data privacy in general and poor content moderation.
However, their business continues to be very strong (2019: 2.5 BN users, $55BN revenue, $25BN profit and 35k employees, $1.6M revenue / employee) and I think it will continue to grow and become more diversified over time. Right now, almost all of their revenue comes from advertising, which results concentration risk and has durability issue in a recession.
There are three core segments of FB’s business – Core FB, Instagram and Whatsapp and they cater to different audiences:
Core FB: Core FB has 2BN (a little bloated probably) monthly users. This is still very popular among baby boomers who have both time and money. Their engagement is solid, and they are a highly valuable audience from an ARPU perspective. It’s why monetization is still so strong. Core FB has seen a dip in engagement from younger audiences, and probably has low engagement with developed market teens.
Instagram: Instagram has over 1BN monthly users. Instagram has strong engagement with younger people in developed markets and celebrities. Engaged people often have multiple accounts for multiple use cases (Interest X, close friends, ’normal’) and interaction / time spent metrics are very high – it’s probably the best product / interest discovery tool on the internet. I’m personally very excited about Instagram building shopping/transacting natively into its app – inventory management, transaction, shipping etc allow instagram to own more of the value chain, create a consistent experience for shoppers, and provide them with a completely new revenue stream (% of transaction) in addition to advertising.
Whatsapp: Whatsapp probably has 2BN monthly users. It has high engagement in most english speaking developing markets in Africa, SE Asia and Latin America. From my experience in Africa, it has completely revolutionized business and personal communication and will continue to do so over time. Whatsapp has very high revenue potential for FB in three areas:
Advertising – small business and business discovery through search and referral
Tools / subscription services – products to allow businesses to run better (e.g. CRM, template responses, workflow) are useful for both enterprise and small business and can generate subscription revenue
Payments – Whatsapp could power P2P payments (within countries and cross-border) as well as C2B payments which would open up a new revenue stream entirely for them, and bring more ‘core actions’ into their product. Payments and messaging are often strongly linked, and this is a natural extension of how people are already using the product
I think that Whatsapp (payments, business) and Instagram (discovery -> transaction) will allow FB to diversify their business model and tap into different market/people segments and think FB will continue to be a great long-term investment.
Disclaimer: I’m not a professional public markets investor, I don’t have a sense as to whether the stock is current fairly priced and came to this conclusion based on ‘value investing’ concepts and product/business thinking. This is not a recommendation to buy or sell FB stock.
In my opinion, one of the hardest parts of product and general management is drawing insight from the right sources to determine ‘product health’ to identify where to focus, especially when managing multiple product lines.
In my experience I try pull data from three independant, uncorrelated sources to inform where I should focus my effort – the data, the team, and the users:
Data: Design dashboards that give you the metrics at the right level of detail on a daily/weekly/monthly/quarterly basis. Be able to translate data into concrete hypotheses and insights.
Team: The general manager (GM) or product lead of the business is your main source of information, but make sure to spend time with team members and other functional leads as well, so you can validate/invalidate what you hear from the GM. The broader team is also an incredibly strong resource for ideas for new features.
Users & Customer Service (CS): It’s important to maintain empathy/understanding of your customers, even when you’re a step removed from the product.
On a regular cadence (e.g. weekly), spend time reading user reviews, blogs, forum posts etc.
Get quantitative and qualitative information from the CS team about what users are saying about your products over customer service channels, either through a short meeting, or a list of top 5-10 issues each week.
Spend time actually interacting with customers, and responding to them (directly or on forums for example).