In today’s episode of The Startup Chat, Steli and Hiten talk about the difference between running a fully remote company versus semi-remote companies.

The business world has changed. It’s now possible for employees to work outside of an office and be very productive at it. But deciding if your company should be a remote company or a semi-remote company is a critical decision a founder can make

In this episode, Steli and Hiten talk about how Close started as a semi-remote company, why remote employees shouldn’t be treated or feel like second class employees, how Hitens company managed their remote teams.

Time Stamped Show Notes:

00:00 About today’s topic.

01:10 Why this topic was chosen.

02:00 How Close started as a semi-remote company.

03:39 Why remote employees shouldn’t be treated or feel like second class employees.

03:37 Why Airbnb stopped referring to their headquarters as HQ.

04:44 How companies fail to understand how to make remote working work.

05:05 How Hitens company managed their remote teams.

05:50 Why everyone should have the information they need to do their jobs.

06:06 How to ensure that everyone should have the information they need to do their jobs.

06:33 The importance of understanding that you have to fight silos.

3 Key Points:

  • Remote employees shouldn’t be treated or feel like second class employees
  • We started documenting meetings all the time.
  • Everyone should have the information they need to do their jobs.


Steli Efti: Hey, everybody this is Steli Efti.


Hiten Shah: And this is Hiten Shah.


Steli Efti: And today on The Startup Chat, we’re going to talk about the difference between running a fully-distributed, or remote company, versus being, let’s say, semi-remote and semi distributed. So, let’s first define what the difference is between the two, and then let’s go through the pros and cons of both approaches. Right, so we have talked recently on The Startup Chat about the trend of remote work and that not going away. Check that episode out if you haven’t listened to it, but today I wanted to talk about a difference between companies that from Day One have decided that they’re not going to have an office and that every person that works in the company is basically working in the distributed fashion remotely and is setting up their own work environment. All right, and all work, all collaborative work, all communication, happens virtually versus companies that do part of their work or have part of their workers outside an office. So, semi-remote, in my definition, means you have an office or multiple offices but you also have… Either you have a bunch of people that work for you that are not working out of these offices and live in completely different locations or, and this is a big or, you have everybody that works for you, let’s say… The early days of Close we were qualifying ourselves as semi-remote because we did have a small office, and everybody lived in the Bay area, so they could get to the office. But people were traveling so much, or entire team was traveling so much, and we really didn’t care that much about having working hours in the office. But we thought of ourselves as semi-remote because, at any given time, it was very rare that all of us were at the office. At most of two out of three months there was maybe just like two out of the six or seven people that worked actually in the office.


Hiten Shah: Wow, yeah I’ve had an office once, and I didn’t really go into it as much as other folks did that were in the area. I don’t think we’ve made it the biggest requirement to go there and then we had a lot of folks who were remote as well, and I think I’m going to start it off by… their equal in terms of team members. And I think that’s a very challenging thing when you have an office and you also have remote folks, because remote folks should not be treated or feel like second-class citizens. There is a pretty huge risk of people feeling that way.


Steli Efti: Yeah, I think that’s really one of the biggest challenges that you have to work on when you have an office and some of the people are not… Are in a completely different location is that it’s very easy to create the impression or create the reality that there’s two classes of citizens at your company. Right? There are the people that are in the… And this is even true for companies that have multiple offices but there’s one headquarter, all right. And then, I remember recently a friend of mine that worked at Airbnb, she was telling me how they stopped referring to the San Francisco office of Airbnb as HQ-


Hiten Shah: Yeah.


Steli Efti: …because a huge part of Airbnb’s business and growth and profitability came from Europe. But the Europe offices and all the management there felt like they were totally disconnected from HQ where all the important decision are being made. Right? And, so it’s interesting, this is a challenge anywhere, but I think even more so when there’s not even an office, and you’re just like, you live somewhere, and you work somewhere on your own and then everybody else or many, many… Most of the other people in the company work out of one central location. It’s very easy to be siloed, its very easy to feel like you’re a second-class citizen, and I think that can be very detrimental to culture and to making these distributed workers successful. I think a lot of times when companies try this semi-remote set-up they don’t find as much success because their not as empathetic and as thoughtful about how to design an environment that’s going to really empower these remote and distributed workers. And then when it doesn’t work out, it makes them go to the conclusion that, “Yeah, we tried hiring people remotely and it doesn’t work.” Right? Versus understanding that they were not as thoughtful in designing a work environment that would empower these people to succeed.


Hiten Shah: Yeah, it’s interesting like what we started doing was, even if you’re in the office, when there was an All Hands you had to join remotely.


Steli Efti: Mm-hmm (affirmative).


Hiten Shah: So that was one thing we did. Another thing we started doing was we started documenting meetings a lot more. So there were notes and appropriate people would get those notes shared, or everyone would if it was relevant to everyone. Even today on our remote teams, I’m personally doing more of that sharing notes with appropriate people after I have a meeting because they weren’t in the meeting. And it doesn’t matter if it’s a meeting internal or external, I’m doing that more, and more, and more, even if it’s just a bunch of bullets in Slack, just so I think it’s rally easy to have what you would say are random conversations when you’re in an office. Whether it’s like, even after work for drinks or whatever it is. And it’s just really easy to do that and you don’t get to do that when you’re remote. So, what do you do? How do you make sure people have the information they need? Because really that’s what it’s about. Everyone should have the information they need to do their jobs and they should have as much information as possible would be the logical way to think about it. So the one way to do that would be to spread the information around and you’re just more diligent about making sure that that information spreads and that you’re taking notes and you’re being diligent with documentation and things like that. So there’s a bunch of stuff you can do and it’s sort of like the equivalent of mandates, right? Like this is how we do it and we do this so that everyone knows what they need to know even if they’re not in the office.


Steli Efti: Yeah love that. And I think that number one, understanding that you have to fight silos, that you can’t just have in person chats and [inaudible] brainstorms that are not documented and shared anywhere. Right, and then expect people that are remote to have the proper context and feel truly connected to the vision, mission, or the goals that you’ve set. Right, because they’re just lacking all this information anytime a distributor worker would hear something like, ” Yeah, we discussed this last week and decided that…” and they weren’t there, it breaks peoples hearts, right? It really makes them feel terrible which then leads to very, very back outcome. So creating transparency, making sure that even when every bodies in the office, every conversation is documented, communicated… We often times when we were like… So we started with this, like, everybody in an office but people were traveling all the time, then we started hiring remote people and at some point we were like 50/50. Right, 50 people who were in the Bay area, and 50 percent that were people outside the Bay area that we had hired. And, you know, we would make sure that we would record every kind of meeting that we had and uploaded it to Dropbox so people could just listen in to either brainstorming sessions or anything else that would go on. We would write transcriptions or summaries of conversations that were going on, and I think that that made a big difference. Another thing that I heard from other companies that’ve tried this that said that, you know, that had a core team in an office and then a bunch of team members that weren’t, is that they… I was just talking to somebody yesterday about this, that they… What they did, and what they’ve tried and what can work really well, is to do these fully remote weeks. So you can go two ways, right? You can fly in the remote workers frequently to work out of your office with everybody else to connect more if there’s an office there. But the reverse is also to have a full remote week where even the people that are in the office are not allowed in the office for that week, right? And everybody is doing distributor work and that can work magic to increase empathy. That can work magic so that somethings that the, kind of, on-site team members were annoyed by, like, “Why do I have to write this up? This is all this busy work that’s not really useful.” All of a sudden, once they have to go fully remote, and they have to get with bad wifi in a coffee shop or the challenges of working all day from their pajamas or feeling disconnected about a discussion of this type or the other, it increases empathy. And I think it then makes it so much easier for people to develop better ideas on how to work better together, how to communicate better together, and also a passionate commitment to really support the people that aren’t in the office. And so I’ve heard many, many… we’ve never done this, but I’ve heard this about for the third or fourth time from people that had this setup of the core team in an office, and a bunch of people that weren’t, and I’ve heard really great result and makes total sense to me as an ideas, as a strategy to make sure there’s a good culture in place.


Hiten Shah: Makes a lot of sense. Yeah, I think there’s ways we can manage this, we’re just learning still.


Steli Efti: Yeah, now as a last thing that I want to touch on, this fully remote versus semi-remote, we talked about the semi-remote one because it’s the more complicated one to a certain degree. Right? How they keep kind of [inaudible] and culture and make sure everybody feels like they’re valued the same way. When you’re starting out, let’s say you’re a founder and you’re just starting out, and you’re not sure. Do I want to do remote or do I not want to this and the first one or two people that I want to start this company with, they are living in the same city as I do. Any risks to starting with an office and then going remote or going semi-remote or any benefits to being fully dedicated to fully remote no matter how many people that you hire that live in that city? What’s your take on that? What would be your advice to a founder that is like, “I don’t know if I should have an office or not? If I should go fully remote or not because I could see both things working out in the long term and I don’t know quite how to start.”


Hiten Shah: Yeah if you’re not sure and you’re able to work in person then work in person and as you start making hires, decide what works better. Because a lot of times, in the beginning, you’re still learning a lot about each other and the business and how it’s going to work. So if you’re not sure, then start with whatever’s the most comfortable for you. So if you’re in the same place, start working in the same place, it’s okay, it really is. You can change it as long as you’re pretty small. Its harder to change it after about a dozen people. Twenty is kind of the threshold where it makes it really hard to change and not have some kind of fallout, people leaving, or just some kind of difficulties. Bu my suggestion would be just don’t make this such a big thing that it stops you from starting, or it causes you to have a lot of confusion and prevents you from sort of taking action on just building your business. Because I think that’s the number one thing. Which is start building your business and do it in whatever ways the least friction possible and you can decide you know like I said, before you hit ten, ideally before you hit five, what you want to do about where you end up. Whether you want to end up fully remote or a hybrid or just build out an office.


Steli Efti: Exactly, I couldn’t have said it better. I totally agree and I would just add one little thing before we wrap up the episode to your point, which is, if you are thing about remote, you want to get better at this. Even if you’re three people in an office, you can start practicing best practices. Right? And start having the type of processes in place where you don’t just chitchat all day long. You chitchat, and then you document. Right? Or you make sure that certain this are recorded; you make sure that just certain practices in the way you create transparency within the team are adapted even early on. You don’t have to spend most of the time on it but just a little bit to build that muscle, so as you start growing the team and potentially hiring somebody that’s not there, its easy to transition into that and you’re getting better and better at it and you don’t have to worry about it. Whatever’s easiest, do that first because in the beginning, you know, birthing a product that has any kind of merit and gains momentum is so difficult on its own, that worrying about all kinds of things that will happen down the line once you’ve succeeded too early is usually a waste of time. All right. That’s it from us for this episode of The Startup Chat, we will hear you very soon.


Hiten Shah: Later.