#152 – Confidence is earned: How to win the trust of your coworkers | Josh Clemente & Mike DiDonato

Confidence and trust is earned from your coworkers through consistent communication and clear documentation, especially at a remote and async startup. If you aren’t transparent about what you’re doing and what you need, you won’t be able to get anything accomplished. Communication is the foundation of a successful async culture. In this episode, Josh Clemente and Mike DiDonato talk through the differences between trust and confidence, the importance of hiring people you trust, and how confidence is like fitness.

08:35 – Develop proactive confidence building

Josh said Levels is very intentional about who they hire because working in an asynchronous environment means you have to be proactive about building confidence.

When someone comes into the Levels culture, we can all kind of just say, this is going to be value-additive, because I trust that our hiring practices are doing what they’re supposed to do. And so this person, they’re not random. They’re not somebody who’s going to dismantle our culture or is going to feel that it’s an opposition to them. They’ve chosen this place. We’ve chosen them. So we’re at a default level of trust. But when you’re talking about projects and execution, that’s where the context of confidence comes in. And we’re pushing back a little bit on a few themes that can arise, when you’re in an asynchronous and remote environment, which is that, if I don’t have confidence that things that I rely on you to execute on, I can’t do my job effectively, because I’m constantly having to split my brain and focus on the work you are doing or making sure that it’s on task. And so it’s important that we develop proactive confidence building in other people. This is a different thing from trust, again.

09:36 – The difference between trust and confidence

Josh said that at Levels they’re trying to ensure that they have baseline trust, but also build confidence so that they know they’re heading in the right direction.

I think trust is a difficult term, because no one wants to be distrusted. We associate distrust with low integrity behavior, cheating, crime. These sorts of things are where your trust is taken away. Confidence is pretty close to synonymous here, but it’s really weighty. People want confidence, but it’s more of an optimization thing, than it is a deficit. If I don’t have trust in you, then I distrust you. If I don’t have confidence in you or in us, then that is an ambiguity. I would argue that it is not a personal upfront or a declaration or a judgment on you. It’s a statement of the circumstances. So that is the nuance that we’re trying to ensure that we have baseline trust, but also build confidence so that we know that we’re heading in the right direction, and that we are not going to be doing double work or find out late in the game that the rules have changed, and I didn’t know, and now we’re behind schedule and that sort of thing.

10:55 – Hire people you trust

Mike said hiring is a matching game where you try to find people who both fulfill the requirements and who fit your culture.

Hiring, it’s a matching game. It’s not on us to sell an individual to come to Levels. It’s being transparent, saying, “Hey, this is our culture. This is how it works. We’d love for you to join, if it’s a good fit. If not, great, that’s the point. Let’s get out of this process right now.” And I think that’s what you’re talking about assume trust right there when you come in. And then that difference, which is an important one, and it’s specific as it relates to projects. I think you said for you, the light went off as the team grew beyond you and Sam, was like, “Well, now I’m doing this work. And we have, I don’t know, three or four other people working. And I’m reliant on the things that they’re doing, in order to get my task and my objective finished.” I think that’s a important distinction. And I think it’s not just one thing. I think it’s, A, you may need, well, we’re not going to use anybody’s name, Jim Smith to do X-test do your test. But I think it’s also there’s another component. There’s this just not knowing what’s happening, ambiguity, the cognitive load and burden that puts on you thinking, “Hmm, what’s happening?” Or maybe it stops you from doing what you’re doing. Then you have to go look at a document and/or send a message.

13:28 – Put in the work

Josh said confidence is a learned skill that you have to put work into constantly, otherwise it will diminish.

Confidence is more like physical fitness, where you have to be putting in the work consistently in order to build it up and to maintain it. It doesn’t stop. You have to be putting out into the world and to your team the information needed for their confidence to be stable. Otherwise, their confidence degrades, their work product deteriorates, and they are spending their time sourcing information from you, which develops this sense of micromanagement, like, “Why am I being harassed all the time? Let me just do my work.” Well, these things are inextricable. We need to develop the idea that it’s my job to build confidence in you. It’s not your job to just operate and then panic. It’s the exact opposite. It’s my job and my responsibility to make sure that you know that things are on task or as early as possible that the plan is changing. It’s totally fine. This concept of confidence doesn’t mean that things are going exactly to the plan that we laid out months ago. It’s that, as the real world plays out and as things change and adjust and adapt, you are up to speed on what I’m up to speed on.

19:12 – No news is bad news

Josh said communication is doubly important in an asynchronous company, because if you don’t know what’s going on, you’ll have no confidence in your team members.

No news is bad news, when you’re in a vacuum. It’s just fair. You watch professional sports teams. And let’s just say you assemble an all star team. And they’re from all different leagues, all different teams. And there’s a high degree of trust. You know these people are elite players, but there’s no confidence, on day one when you step out onto the court with that team, that what you’re doing. It’s like, “How are we going to play the game? Who’s going to take lead?” There has to be a communication. There has to be a structure to work out the realities

20:45 – Don’t be afraid to communicate

Josh said sometimes people are afraid of bothering others with over-communication, but you can never have too much communication in an async culture.

We’re so used to in-person communication, and the internet has changed this. But you wouldn’t go tap somebody on the shoulder and give them a verbal communication every chance you got of all of the things that are going on. That would be hugely disruptive. But because we have this beautiful discoverable tool set, where I can put information into your purview, and you can come and grab it as you need. That’s the difference. This is not disruptive. And fundamentally, the sort of actionability of our communications, all the memo, we’ve written about how to use tools, how to use notifications, has given us a really nice approach, I think, to not being disruptive. So that’s just a misinterpretation. There is essentially no such thing as too much communication in the remote async world.

25:04 – You are responsible for obtaining context

Josh said if you don’t have the information you need to complete your task, it’s your responsibility to find it.

It is on the directly-responsible individual to ensure that they always have the context they need to have the highest degree of confidence in the direction that we’re moving in. And that anyone else, who has a single point of reference for where that project is… And it’s owned through to completion. And whether it’s a quote/unquote success or a failure that’s not relevant. What matters is, “Did this person execute to the best of their ability with the information they had?” And that’s critically important. We just need that direct line of accountability. And distributing it creates gaps. It creates accountability issues. And so part of being directly responsible individuals is not just whether you have the label associated with the project, it’s also for the work that you’re responsible for. You are the DRI. We’re not the finger pointing culture where it’s like, “Oh, well, I didn’t have the right information at the time.” Well, if you don’t have it, you got to go find it. And if you’re not putting it out there, and someone’s having to come and get it, that’s on you. So in both directions, it’s like, “It’s on me to go and get the information. It’s on you to give it to me.” We need to continually elevate these realities. It’s an active effort. It’s not something that’s going to happen naturally.

36:34 – Transparency builds confidence

Josh said if you are honest and transparent with your audience, they will have greater confidence in you and your company.

By sharing that context continuously, you are building confidence. The whole story is out there in the light, and that develops trust and benefit of the doubt. And so when you do fail in a big way, you’re not going to have your cap table run away. You’re not going to have your earliest believers, your earliest members, your earliest team leave you in the lurch, because they were shocked and surprised by a failure, or because you’ve tried to own the narrative and gaslight people into thinking that things were a different way than they were. If you’re constantly telling the truth and you’re being proactive about sharing, even the dirtier side of things, that’s just really refreshing. And my philosophy on this has completely transformed, because, at the macro level, just seeing how sharing our investor updates and being open with our weekly all-hands meeting, it’s built so much goodwill. I mean, it’s impossible to understand exactly how much benefit we’ve earned from that. But people are on our team today, people have come and joined Levels, because they have seen the information and the way we share and the culture through those materials that we record and put out there. So my philosophy’s totally changed.

48:56 – Be intentional with information

Mike said the people at Levels aren’t ambiguous about what they want or need from others. If someone needs an answer, they know to ask for it.

I don’t think it means to just throw things over the fence. We don’t do that. Or we don’t say, “Let me know your thoughts.” I think what we’re talking about, it doesn’t have to be perfectly formatted, but we have to be really intentional on how we do these things. We don’t want to play, think of the document, you said hot potato. “Oh, now it’s up to you.” Really clearly, if it’s just informational, just put that tag with it, just so that everyone knows, “Hey, I don’t have to have response, but if I want to add something, then I can.”

Josh Clemente (00:06):

Part of sports is constantly evolving. There’s an offense and a defense and you might run a play, but that doesn’t mean that it’s going to go according to plan. And so you have to be calling out where you are, as things are evolving in real time, and making sure that the person who’s focusing on handling the ball is able to make the blind pass. Or not to take this analogy too far, but the point is just you have to do everything you can to make it easiest on the directly responsible individual at that moment, to know that things are moving in the direction they need to move.

Ben Grynol (00:39):

I’m Ben Grynol, part of the early startup team here at Levels. We’re building tech that helps people to understand their metabolic health. And this is your front row seat to everything we do. This is A Whole New Level.

Confidence and trust, they seem to be linked, and they are very close in some respects, but there’s a nuance in the distinction between the two of them. So a lot of culture content that we put out, we dug deeper into this idea of what’s the difference between confidence and trust. Recently, Josh Clemente, founder of Levels, he sat down and wrote a memo called Confidence is Earned, and it’s all about this distinction between the two. You can have a high level of trust that somebody can execute, but you might have a low level of confidence that they’re going to follow through. There are little signals that we get. Maybe somebody doesn’t respond to a communication. Maybe they don’t communicate enough. Maybe you don’t agree with the direction that the project is taking. And so that’s where confidence comes in, high level of trust that the person has the skillset or the ability. The knowledge, and the experience to actually execute on the project may be a low level of confidence that the project’s going to be executed well, maybe communicated well.

So Josh and Mike DiDonato sat down, and they discussed this idea of confidence being earned. What is it? And why do we think so much about it? Again, we focus so much on culture, and no matter how many founders and team members we talk to at other startups, even thought leaders in the space, people like Mark Randall, founder of Netflix, people like this will say time and time again, “You aren’t investing enough in culture.” So it might sound exhaustive. It might sound like something that we reiterate over and over, and we are going to every corner of the Earth with these culture conversations. But they are integral, and they’re very important too share these learnings with other founders, other people that listen to the podcast. So Josh and Mike, they sat down and discussed this idea in depth. It’s always fun listening to these cultural conversations. Here’s where they kick things off.

Mike DiDonato (02:55):

We had an internal team fireside chat, and this came from a memo that you put together. And I think before we jump into confidence and what that isn’t, I’m curious, why that memo? Why now?

Josh Clemente (03:13):

It’s a good question. I mean, I think generally when we’re building culture, it’s about searching for themes of things and addressing, or trying to shape, problems that are not necessarily obvious yet. There’s just sensations or feelings or themes that are arising. And this is an example of that, where I wouldn’t say it’s a problem, but when we’ve kind of focused on communication and how to optimize communication a lot, “Here are the tools, and here are the tool sets.” But we’re not really talking about what is the objective of communication. And a lot of the conversations that I had had, and that the feedback that I’d had gotten from Sam and from Casey and others, is that it felt like there’s some misalignment about what the output of communication is intended to do. And we were dancing around some themes, and Sam and I had a chat.

Sam kind of stumbled on something where he said, “Trust is earned. It’s like you don’t start off default trust in most scenarios. You have to get a feel for what’s happening, who’s got the ball.” We were talking about sports a little bit, and he was saying trust. And that kind of hit a note that I was feeling, which is that you do have to build… Both he and I have had a background of this where you have to build some context with each other, and eventually you develop. And for me, I’ve pushed back, said, “Actually, I don’t think it’s trust. I think it’s confidence.” I can have a default level of trust that somebody is capable and effective and knows what they’re doing and has a huge skill set. But that doesn’t mean that I have confidence in the direction our project is going in. We’ve all experienced moments where there’s just ambiguity. You have great people in the room and they’re talking past each other. And there’s not a lot of confidence being aligned on, in terms of where we’re all heading. Are we rowing in the same direction?

So that chat with Sam, it was sort of a culmination of a few contextual conversations from the past few months and weeks about ambiguity. And certain teams are doing this really effectively, and they’re communicating with the same intention in mind. And other teams are not; they’re kind of talking past each other, or they’re communicating in different ways. Some people are feeling a huge burden. They are putting a huge burden on somebody else with their communications, and others are feeling like, “I have to communicate even more than I’m comfortable with.” So ultimately that was the objective is just shape something that felt value-additive to try to align on why are we communicating? What’s the objective? And the objective is earning confidence among our peers.

Mike DiDonato (05:55):

I think most of us at Levels, even when it’s just coming to behavioral change, we say people don’t people don’t just stop doing what they’re doing, because they don’t want to. Oftentimes they stop doing what they’re doing, because they don’t understand why they’re doing something. Or the why behind it, not only is it not clear, it’s not strong enough. And we do talk a lot internally about communication, about tools, and various other topics, but it was interesting to see how it all weaves together. What is that end objective? And I think it’s important, what you talked about is, and I know we talked about this, was there’s a difference. You said when you and Sam were talking trust versus confidence. And I think it’s worth talking about this for a bit. One of our cultural values is, “Assume good intent.” And lack of confidence, I think you may have even said this verbatim in the doc, it doesn’t mean that there’s any ill will or anything nefarious is happening. But I’d love to maybe get in your head for a second. As you were putting the document together, how did you balance or delineate that confidence and trust or goodwill?

Josh Clemente (07:17):

It’s tricky. I mean, I think what it comes down to is if your hiring practices are effective. And there’s a few elements of Levels culture, which are maybe unique. Some of this is pretty table stakes for high performing companies. But one example is we’re a team, not a family. And the objective there is to say, we’re high performers. We’re here to do a thing to accomplish a certain objective. And family is a different concept. Family in it through thick and thin. It’s like there are all these concepts of relatives versus friends. You picked your friends; you don’t pick your family. We all understand this. And we are here to create a very high talent density and to execute with very high degrees of efficiency towards our objective. And so, that’s the environment that we’re starting this conversation in. And we have a really great hiring and onboarding and really culture selection mechanism, or structure, in place.

So people are selecting Levels, as much as Levels of selecting them. They’re finding what we put out there into the world, and they’re saying, “That’s for me.” So when our hiring is working, which I would say it is, we can kind of start at default trust. And that’s important. This is not an unknown variable. When someone comes into the Levels culture, we can all kind of just say, this is going to be value-additive, because I trust that our hiring practices are doing what they’re supposed to do. And so this person, they’re not random. They’re not somebody who’s going to dismantle our culture or is going to feel that it’s an opposition to them. They’ve chosen this place. We’ve chosen them. So we’re at a default level of trust.

But when you’re talking about projects and execution, that’s where the context of confidence comes in. And we’re pushing back a little bit on a few themes that can arise, when you’re in an asynchronous and remote environment, which is that, if I don’t have confidence that things that I rely on you to execute on, I can’t do my job effectively, because I’m constantly having to split my brain and focus on the work you are doing or making sure that it’s on task. And so it’s important that we develop proactive confidence building in other people. This is a different thing from trust, again. What I first said to Sam, when we were talking about trust versus confidence, is, “I think trust is a difficult term, because no one wants to be distrusted.” We associate distrust with low integrity behavior, cheating, crime. These sorts of things are where your trust is taken away.

Confidence is pretty close to synonymous here, but it’s really weighty. People want confidence, but it’s more of an optimization thing, than it is a deficit. If I don’t have trust in you, then I distrust you. If I don’t have confidence in you or in us, then that is an ambiguity. I would argue that it is not a personal upfront or a declaration or a judgment on you. It’s a statement of the circumstances. So that is the nuance that we’re trying to ensure that we have baseline trust, but also build confidence so that we know that we’re heading in the right direction, and that we are not going to be doing double work or find out late in the game that the rules have changed, and I didn’t know, and now we’re behind schedule and that sort of thing.

Mike DiDonato (10:36):

Yeah. It’s interesting and pretty timely, because I sat down with Sam, I don’t know, a few weeks ago. And we were talking about transparency and building in public and the trust there. And he talked about hiring. And it kind of segues to what you said. So hiring it’s a matching game. It’s not on us to sell an individual to come to Levels. It’s being transparent, saying, “Hey, this is our culture. This is how it works. We’d love for you to join, if it’s a good fit. If not, great, that’s the point. Let’s get out of this process right now.” And I think that’s what you’re talking about assume trust right there when you come in. And then that difference, which is an important one, and it’s specific as it relates to projects. I think you said for you, the light went off as the team grew beyond you and Sam, was like, “Well, now I’m doing this work. And we have, I don’t know, three or four other people working. And I’m reliant on the things that they’re doing, in order to get my task and my objective finished.”

I think that’s a important distinction. And I think it’s not just one thing. I think it’s, A, you may need, well, we’re not going to use anybody’s name, Jim Smith to do X-test do your test. But I think it’s also there’s another component. There’s this just not knowing what’s happening, ambiguity, the cognitive load and burden that puts on you thinking, “Hmm, what’s happening?” Or maybe it stops you from doing what you’re doing. Then you have to go look at a document and/or send a message. And then I think that’s what you’re getting at, right?

Josh Clemente (12:24):

Yeah, effectively. So a couple things, those themes that have been bubbling up reminded me over the past few weeks and months as the team has grown, whereas now people are operating with ambiguity. And some people are proactive about going and sourcing the information they need. They’re like, “I need to build confidence. I’m going to go find it.” And so it can feel like pestering or micromanagement to be constantly pushed for data or for information or for updates. And there’s been some degree of friction around this. And this is what Sam and I were talking about is that we need to express something about this element specifically, which is that this is not micromanagement. We are in an asynchronous remote environment. And in that environment, confidence and context are not to be assumed. They atrophy. The absence of information is not confidence. It’s the opposite of that. It’s low confidence, or it’s complete ambiguity and uncertainty.

So we actually have to develop this concept of… Confidence is more like physical fitness, where you have to be putting in the work consistently in order to build it up and to maintain it. It doesn’t stop. You have to be putting out into the world and to your team the information needed for their confidence to be stable. Otherwise, their confidence degrades, their work product deteriorates, and they are spending their time sourcing information from you, which develops this sense of micromanagement, like, “Why am I being harassed all the time? Let me just do my work.” Well, these things are inextricable. We need to develop the idea that it’s my job to build confidence in you. It’s not your job to just operate and then panic. It’s the exact opposite. It’s my job and my responsibility to make sure that you know that things are on task or as early as possible that the plan is changing.

It’s totally fine. This concept of confidence doesn’t mean that things are going exactly to the plan that we laid out months ago. It’s that, as the real world plays out and as things change and adjust and adapt, you are up to speed on what I’m up to speed on. It all goes back to really the very beginning of Levels, when Sam and I were just starting our working relationship. It was just two people at the company. And almost immediately, there was a breakdown of confidence on his part. And I would argue not trust, because we continued to work things out, and the trust baseline allowed us to work through this. But because we had different background and different working styles… I’m a hardware engineer. I’m used to being side-by-side at a work bench with the people that are working on the project, and the confidence and context is almost automatic.

Sam, he’s a digital nomad. He’s like a road warrior in tech. And so he’s very familiar with what happens when you don’t have high degrees of information sharing. And so he and I had this problem. He was pushing me for more information than I felt like was fair. And so I was saying, “Oh, this is micromanagement. I’m doing all my work, way more than my share,” let’s just say is how it felt. And we’re both just pushing as hard as we can, so what’s the deal here? It felt negative. And then you touched on the team grew. And all of a sudden I was in Sam’s shoes, where new people had come on. They had taken on a portion of the work. And all of a sudden, I’m operating in ambiguity. I’m like, “Are we on track? What’s the status of this and that? My work is dependent on these milestones, and I don’t know where we are.” And we hadn’t yet figured out our culture.

So I started to experience what Sam had experienced, which was that we had a ton of balls in the air. If we’re going to catch these, and things aren’t going to get dropped, I need to have a high degree of confidence. And that comes from communication. So it’s a long-winded way of saying this wasn’t new. It hadn’t yet been named and, I think, explored in a written format. But we were all bumping into it in varying degrees. And so, this memo was an effort to lay it out and make the nuance between trust and confidence and understand, or help others understand, that this affects all of us, and communication is the structure that enables confidence building.

Mike DiDonato (16:43):

I think what you said about connecting the dots for why it’s so important, why we always say bias towards more communication, or why we run wacky experiments in our onboarding, where we have people just communicate with video and audio. I’d say it’s very much important for, I think you said this at the top, for any high performing team, but I’d say in particular with the remote nature or the work that we do, and given that, although we trust everyone on the team, we don’t really know what everyone is up to unless we get those updates. So we don’t have a water cooler, where you can casually talk and share context about what’s happening with your project. And I think you may have even called that out in the memo. That’s non-intentional confidence building right there, or at least context sharing.

To kind of pause and double-click on what you said about as the team grow and people taking on more responsibilities, I remember, and I’m going to plug one of our episodes, the founder dynamics pod with you and Sam. It was interesting in particular for me, because 2019, 2020, I probably worked closest or very closely with you and took on a lot of your responsibilities. And it was interesting to hear both your and Sam’s perspective at times that I was actually a part of. And I was in my mind thinking, “Well, I remember those times. I definitely could have communicated better, hindsight being 20/20.” But what I was thinking was like, “Well, there’s six people, five people. I’ve got this all locked down. No one has to worry about this. I don’t need to burden anybody with a message or an update.” And-

Josh Clemente (18:47):

Let me be out of sight out of mind, basically.

Mike DiDonato (18:49):

Exactly. It’s like, “Hey, Sam’s doing X, Y, Z. Josh is now onto something else. Andrew and John are our only engineers. It’s okay. I’ve got this locked down.” But as you said, the absence of communication is actually how confidence is eroded, right?

Josh Clemente (19:11):

Yeah. It’s like no news is bad news, when you’re in a vacuum, right? Yeah. It’s just fair. You watch professional sports teams. And let’s just say you assemble an all star team. And they’re from all different leagues, all different teams. And there’s a high degree of trust. You know these people are elite players, but there’s no confidence, on day one when you step out onto the court with that team, that what you’re doing. It’s like, “How are we going to play the game? Who’s going to take lead?” There has to be a communication. There has to be a structure to work out the realities of working together with other people. And a lot of that is communication.

You see out there part of sports is constantly evolving. There’s an offense and a defense. And you might run a play, but that doesn’t mean that it’s going to go according to plan. And so you have to be calling out where you are, as things are evolving in real time, and making sure that the person who’s focusing on handling the ball is able to make the blind pass. Or not to take this analogy too far, but the point is just that you have to do everything you can to make it easiest on the directly responsible individual at that moment, to know that things are moving in the direction they need to move.

To get back to the sort of underlying uneasiness that a lot of people have, I think, about putting more communications out there than they might feel comfortable with, there’s two elements to that. One is I don’t want to burden the other person. That’s just a misinterpretation. And it’s because we’re so used to in-person communication, and the internet has changed this. But you wouldn’t go tap somebody on the shoulder and give them a verbal communication every chance you got of all of the things that are going on. That would be hugely disruptive. But because we have this beautiful discoverable tool set, where I can put information into your purview, and you can come and grab it as you need. That’s the difference. This is not disruptive. And fundamentally, the sort of actionability of our communications, all the memo, we’ve written about how to use tools, how to use notifications, has given us a really nice approach, I think, to not being disruptive. So that’s just a misinterpretation. There is essentially no such thing as too much communication in the remote async world.

And then the other thing is, “Well, if I’m being pushed to put more out there, it means that this person doesn’t trust me, and that doesn’t feel good.” And that’s one way to interpret this. You brought it up, but that’s why we have this cultural value of assuming best intent, which is that, “Is this person actually trying to prove that I am screwing things up or that I don’t work or that I’m not up to the task? Or is it more likely that this person is just trying to make sure that things are on plan, so that we can reorganize or pivot if necessary, or just sync and continue rowing?” And the assumption of best intent is critically important to not sort of deliberately misinterpret each other.

Again, back to the hiring thing, we can assume that nobody is going to set aside their life, their career, change plans, move over to tackle the metabolic health crisis with Levels, if their intention is to destroy it from the inside. I mean, there’s just no incentive there, other than crazy, crazy conspiracy theories. So that’s the context. We’re all here to do the same thing. We can assume best intent, and we have to. If the memo and the message is interpreted in that light, then we’re on the right track. And it’s that, when people are asking you for more information, it means that you are actually not building the confidence proactively to give them the signal they need.

Mike DiDonato (22:58):

Yeah, that last part in particular, it’s pretty timely, because at Levels we do a monthly leadership book club, and this month is on Extreme Ownership by Jocko Willink. Pre-read it a couple weeks ago, and it’s funny. A lot of the principles in this book relate to this topic and many of the things we do at Levels. But the one you just mentioned was people are asking for information, that means that there’s some ambiguity on your end. I think that does come back to ownership. And I think in his book, it’s leading up the chain of command. And Jocko shares, he’s like, “When we’re on the battlefield, I had some subordinates that would just weren’t understanding why our superiors were asking for more information and more information.” And his thought was, “You have to look inward. Clearly, there’s something that we didn’t provide up front that could have avoided this situation.”

And I kind of think of it in a similar fashion, just beyond internally, when we think about our members. If our members are either writing emails to us or messaging some fashion, asking us a question, either we didn’t set the proper expectations or communicate this properly, or they just couldn’t find it. And that’s ultimately on us to fix that problem.

Josh Clemente (24:25):

Absolutely. Yeah. I mean, I love that you linked it with Extreme Ownership, because that’s the paradigm that almost every cultural principle at Levels is built on, is that we don’t really believe in this distributed responsibility concept that is more and more evident in, I think, society and in certain structures. It’s fine if you want to build a company that way, but we have the concept of a directly-responsible individual. And that is that person owns the outcome, whether or not they’re the ones doing the work. Those are separate things. It is on the directly-responsible individual to ensure that they always have the context they need to have the highest degree of confidence in the direction that we’re moving in. And that anyone else, who has a single point of reference for where that project is… And it’s owned through to completion. And whether it’s a quote/unquote success or a failure that’s not relevant.

What matters is, “Did this person execute to the best of their ability with the information they had?” And that’s critically important. We just need that direct line of accountability. And distributing it creates gaps. It creates accountability issues. And so part of being directly responsible individuals is not just whether you have the label associated with the project, it’s also for the work that you’re responsible for. You are the DRI. We’re not the finger pointing culture where it’s like, “Oh, well, I didn’t have the right information at the time.” Well, if you don’t have it, you got to go find it. And if you’re not putting it out there, and someone’s having to come and get it, that’s on you. So in both directions, it’s like, “It’s on me to go and get the information. It’s on you to give it to me.” We need to continually elevate these realities. It’s an active effort. It’s not something that’s going to happen naturally.

From a first-person perspective, it can feel uncomfortable. I didn’t want to admit that I was totally dropping the communication ball early on, because it felt to me that I was not dropping the overall work ball.I had a ton of stress. I had infinite things on my plate. And it’s like, “Why would I add one more thing to my plate, so that Sam can feel more comfortable? That doesn’t make sense. We’re both operating uncomfortably right now.” But the reality is that the lack of confidence in me meant Sam couldn’t do his job effectively. This is the ultimate reality is just that was out of sight for me. So it takes some reps to really internalize this, but the more we can share our real world experiences… And I actually I’d love to hear from you. I mean, you’ve worked in different cultures that maybe didn’t have this directly-responsible individual sort of concept.

Mike DiDonato (27:21):

So in my prior lives in finance and banking, at least in my experience, confidence was based on results, purely on results. And what I mean by results was, “Did you close the deal?” That was really basically the beginning and the end. And there were many shocks, when I joined Levels, when it was five people and as we’ve continued to grow the team. But when I think about confidence… And you said something really interesting there. It’s like, “It wasn’t about success or failure.” I think it’s important to call that out. Especially at Levels of what we’re trying to do, it’s extremely complex problems to solve. And we’ve been building a lot over the last, what is it, two and a half, three years. We still have a lot of work to do. I think it’s Sam or David. Startups that don’t iterate and ship, they die.

And for us, we need to continue to lean into experiments and iteration. And I think that’s the big part of the confidence component. I don’t think I’ve ever seen… I know nobody’s ever gotten in trouble at Levels when a particular project didn’t work out perfect. I’m not sure if we’ve ever had a project that worked out perfectly. But the important part there is that we have to communicate. We have to document. And as long as everyone’s aware of what’s happening, then that’s fine. If we document, we have validated learnings, that’s great. Then we can keep moving forward. And that’s the most important part, right?

Josh Clemente (29:21):

Yeah, absolutely. We should probably caveat at the very beginning that many of us are on different time zones, and we also are not synchronous. So we’re not spending all of our time in verbal communication in Zoom calls. So all of this stuff stacks up, and it allows for tremendous flexibility. Everyone truly owns their schedules at Levels. But the flip side of that coin is that the forced communication channel of conversation and tapping on your shoulder and constantly overhearing is not there. And so context degrades, and confidence degrades much, much faster in our environment. And that’s just a fact. And it’s something that we’ve learned over time that certain communication channels are more effective and less effective in our environment for us. Slack is a disaster. It does not work for our culture. These are things that we had to learn through trial and error.

And the other one is that, yes, confidence degrades much faster here than it does likely an in-person environment. And so a good parallel for this is, because we’re able to go heads down deep work, we can fly a lot faster. But if you have a one degree… There’s this 1 in 60 rule and aviation, which is referenced in the memo. But if you’re traveling 60 miles, and you’re off by one mile in your destination, that was only a one degree misalignment at the very beginning when you started your flight. So things can feel like, “They’re pretty much on track. I told everyone it was this way last week. And it’s basically that way. Only these few small things have changed.” But if you’re not projecting into the future how this affects everyone else’s work, it’s really, really hard to recognize how large the gap can be at the end of the project.

So those sorts of things we started to experience, where low cadence communication, where, let’s say, every two weeks you have a deep chat with somebody. And it’s like, “Oh, we’re finding out in this deep conversation, that we’re way off each time.” So every two weeks, it feels like we’re doing all this work to pull everybody back into alignment. Well, that can be resolved through leveraging our asynchronous nature and just doing higher-cadence, lower-resolution updates. So just sending that for your situational awareness, only forwarding that email, shooting out or recording a quick Loom saying, “FYI, had to chat with so-and-so, and it’s not looking like we’re going to be able to move forward with that. I don’t have a plan yet, but I’m going to update you tomorrow.” Just that sort of real quick, takes 60 seconds, is a dramatic difference from what a lot of companies would call an update, even acceptable communication.

But because we’ve embraced it, and we’ve said, “We’re going to do these discoverable, high-volume communications,” we are able to maintain that alignment, even as things change. We can have this serpentine route that we’re taking to get to the end destination, but if everybody’s communicating, we all know that’s the case, no problem. That’s just the rules of the game that we’re playing. So yeah, I mean, that’s a little bit long-winded, but it’s just to talk about this doesn’t necessarily map to every culture. I think confidence is earned. Confidence is earned is a reality. How you have to build that confidence is context dependent. In some cases, that’s just every day for lunch, the whole team walks and gets coffee together, and they all sync. That might work in certain environments. It just doesn’t work in ours.

Mike DiDonato (32:41):

Couple things, like you said about, and Sam says this all the time, we oftentimes forget what it’s like to not know something. And when we’re thinking about projects, and I think first we need to understand that, A, in order to succeed in company milestones, in our large mission, we have to understand that the only way we’re going to succeed is if we fail over and over and over. And I think that failure requires a lot of vulnerability and trust amongst the team. And I think the individual, or let’s just call it the directly-responsible individual, has to buy-in and understand that we have to share everything. When I was talking with Sam about building in public, and I’m kind of asking him how we got here. Were there any hiccups? And he’s like, “Early on, I noticed somebody remove a chart or some numbers one month from an investor update.” And he’s like, “I noticed and asked them.” They said, “Well, the numbers didn’t really look that good.” And he’s like, “But that’s not the point. That’s not the point.” I think it’s really crucial to understand that we have to share everything. And as long as we do that, and everyone has the context and understands the status of a given project or a deadline, then we can keep moving forward. So I think that’s an important part to kind of dig into there for a second.

Josh Clemente (34:25):

Yeah. Vulnerability is a good framing, because it feels so strange in, I think, the larger social culture that we have to tell the whole story, to share the whole story, even with the people that we have high trust with. This is our team. We’re 52 people right now. That’s a small group of people. We all have shared passion, shared interest, shared goals. And even inside of all of that principle alignment, it can feel really uncomfortable and difficult to share the whole story. We’re sort of conditioned through our professional lives, through our academic lives, on social media, “Share the good stuff.” It’s like, “We’re only going to put the best foot forward. We’re only going to share that picture on Instagram that looks perfect. We’re not going to show what breakfast usually looks like. We’re going to show that 1-in-30 breakfast.”

But the problem is that everyone knows that’s the case. And the context then is that we all know you’re hiding something. We all know that there’s some dirty laundry behind the scenes. And because you’re pretending there is no dirty laundry, it just deteriorates my confidence that I can trust the situation. That’s where confidence loss leads to trust loss, because you know the whole story isn’t there. What we’ve done… And huge amount of credit goes to Sam on this, because it was not my default coming from an industry background where really sharing was essentially illegal. Working in the aerospace industry, you’re not allowed to share things publicly about your development work. And SpaceX. To its credit, is doing a lot of stuff that no aerospace entity has ever done before, like sharing explosions on live streams.

But the point is we were under lock and key essentially in many ways. And my default was to do this something similar. It’s like, “Fail a lot behind the scenes, but don’t share that. Why would you do that? Why would you undermine confidence early?” And my miss was that, by sharing that context continuously, you are building confidence. The whole story is out there in the light, and that develops trust and benefit of the doubt. And so when you do fail in a big way, you’re not going to have your cap table run away. You’re not going to have your earliest believers, your earliest members, your earliest team leave you in the lurch, because they were shocked and surprised by a failure, or because you’ve tried to own the narrative and gaslight people into thinking that things were a different way than they were.

If you’re constantly telling the truth and you’re being proactive about sharing, even the dirtier side of things, that’s just really refreshing. And my philosophy on this has completely transformed, because, at the macro level, just seeing how sharing our investor updates and being open with our weekly all-hands meeting, it’s built so much goodwill. I mean, it’s impossible to understand exactly how much benefit we’ve earned from that. But people are on our team today, people have come and joined Levels, because they have seen the information and the way we share and the culture through those materials that we record and put out there. So my philosophy’s totally changed. And then that’s the macro example. It’s like that’s how Levels, the company, is building confidence in the larger community.

And then internally on the micro scale, that’s what we have to do is the continuous transparency, sharing the good and the bad. When something goes sideways, or you predict something incorrectly, or you take a swing and you whiff, sharing that information in almost a proud way, owning that this was a risk, “I’m the DRI. I said we should do it this way. Unfortunately, it didn’t work out. Here’s what we learned. And here’s what we’re going to do differently,” there’s some pride in that. You learned something, and I guarantee you’ll never make that mistake again. The whole team has learned from that. We’ve evolved. There’s something proud there, if you are operating in an environment that enables it. And so there’s at the macro scale and the micro scale, it takes vulnerability. It takes support. People around you have to be…

The flip side is the first time somebody’s punished for being vulnerable, this all falls apart. And so that’s something that we cannot ever stray from. Even people who are in both positions, as peers and managers inside the company, that’s a huge responsibility. It’s very easy to fracture something that’s built on this type of trust by pulling the rug out from under someone.

Mike DiDonato (38:57):

Yeah, guys, you were talking, I was kind of thinking about this a little bit more and kind of went back to, I think, Sam a while ago wrote a memo on why we are a memo culture, why we do longform memos. And I think for Sam, it’s the best way he likes to absorb information. But what it does is it allows him to see inside someone’s head or inside someone’s thought process and build confidence. That’s essentially what he was talking about. And I think what you’re saying here is these updates, this communication, what it does, especially for us in our remote async culture, is it allows you, Sam, JM, Mitt, whoever, to at least see someone’s process. And that’s the confidence. You were talking about us sharing investor updates, us sharing the Friday forums, just allowing somebody that could be 3,000 miles from you that you may not see for months just get a glimpse into your process and how you operate and just be confident to know that they have all the context that they need, without having to go and search for it.

Josh Clemente (40:26):

Yeah. I mean, it’s really interesting, because it’s such a vote of… By me building the confidence in you, intrinsically, it’s a demonstration of the trust that we have. We’ve decided that, as a company, our greatest risk is execution. It’s like, “If we can’t execute on our goals, it doesn’t matter if we’re transparent about what we’re trying to achieve or not. We failed.” And it feels, again, very vulnerable. It feels scary. We often, humans, just tend to over-index on the downsides of things and fixate on them. And it’s like, “Well, if we put our investor update that out there, someone’s going to grab it. And they’re going to copy it, and they’re going to execute, not execute.” And it’s like, “That actually makes no sense in multiple different directions, because, if you know that somebody else is already doing this, then you’re already at a disadvantage, so why would you choose to go head-to-head with them copying their same playbook?” It doesn’t make much sense. If you do do that, you have less goodwill, because they’ve already built the initial following to the first mover. So nobody’s going to just accept that your product is better than theirs, because you copied their playbook. It’s the same thing, and your second fiddle.

So there there’s all these ways in which that doesn’t actually make sense. And it doesn’t actually happen. And it comes down to, “Can you execute?” And we’ve decided that transparency is the missing link in so many, specifically, healthcare stories, but startup stories, where people, they’re painting a really happy looking picture, and then it all comes apart in that article that breaks, where unfortunately things were not as they appeared. We’ve recognized, and I think a lot of this is just an early decision that ultimately we didn’t really predict how beneficial it could be, but the confidence building process of writing longform, sharing continuously in open channels, kind of eliminating DMs, making sure all information is discoverable, is that not only does the individual, who’s DRI for example on a project, have the context and confidence they need, but anyone else, who can get up to speed on that stuff in their spare time or as they like, is also building confidence.

So what you end up with, which I think is really cool, is you have new people coming into our company. I can’t tell you how many times this happened, where I’m having the first introductory call with somebody, who we’ve hired, welcoming them to the team. And they’re like, “I know more about this company than the company I’m about to leave.” And the execution across so many different projects is so inspiring. They have confidence already, not just in what they’re going to be working on in their specific function, but also these other angles and elements of the business that they never even saw at their other company. It’s been hard to predict, and it’s such a cool experience. It’s very challenging to describe. There are some downsides of it or some challenges. You got to come in, and writing a longform memo can be onerous. It can be scary. It can be intimidating. But when it’s done, and you read a finished product that really takes you through the thought process and establishes why we’re doing something, everybody coalesces around it really quickly. It’s a lot easier than playing the game of telephone.

Mike DiDonato (43:38):

Yeah. I think the scariest part, at least for me, was that vulnerability, that vulnerability, putting yourself out there for everyone. I remember… It doesn’t necessarily have to do directly with this conversation, but it’s talking about our culture. I remember, we’re still early, but it was fairly early on in the Levels journey. And I forget if it was… You and I were having a conversation, and it may have been about updates or questions or something. And you said to me, “Look, this culture, if you were to ask a question or send an update, and you were penalized, or someone said something smart or condescending, that’s not going to be tolerated here. If it’s not productive in moving us forward… ” And I think you just said it was, “As soon as somebody is penalized for being vulnerable,” that’s where things kind of unravel. And it’s a slippery slope, but I think it’s a really fair point to say that the moment that does happen, it cascades, and it’s a domino effect. When you’re vulnerable, and then someone’s condescending or something similar, then most likely… Well, I think, A, a couple things are going to happen. That person is going to be a lot less likely to share or do that same behavior again. And then the other thing is trust just erodes there.

Josh Clemente (45:14):

Yeah. I mean, I think it’s Netflix that has the cultural principle of no assholes, or something like that. I don’t know. One of the companies does.

Mike DiDonato (45:23):

Yeah.

Josh Clemente (45:23):

I think here it’s just like, “Don’t be the first asshole.” We don’t have that profile on the team. We have tons of various types and demographics and backgrounds on our team, but we don’t have the person who is going to spike the ball in your face, because you screwed up. I don’t think it’s in the nature of the type of person that wants to join company culture like ours. And we’ll filter aggressively against that, because, yeah, it’s exactly that. As soon as we punish either socially or professionally, the vulnerability necessary to do this proactive sharing, the whole story, and the confidence building process, it’s broken. And we’re going to end up in a situation where everyone’s hedging against each other, because I’m not going to share openly. And so you, as someone who’s a recipient of my work, is going to have to hedge against my statements like, “Oh, he is not telling me the full truth. So I got to assume that it’s going to be off by this or that. I’m going to have to dig around tangentially to find the real details.” So you’re spending time digging behind me. I’m hedging against you. And it just becomes this political nightmare. Add to that a remote asynchronous workplace, where to do all of that is just so inefficient, if it’s not put out there in a concise form, it just doesn’t work.

So I think ultimately, we’re converging on a cultural structure and system. It comes down to trust. I have to trust that you’re not going to spike the ball in my face. But if you do, the whole thing comes apart, because I’ll never do that again. You’ll never do it, because you’ll be afraid that I’m going to get you back. I like to think of it in a positive way, which is it’s mutually-assured construction. As long as I’m supportive of you when you’re vulnerable, you will to me. We don’t need to think about the downside risk, even if it’s there.

Mike DiDonato (47:10):

Yeah. I think that it’s flywheel. Everything’s connected. Without the one thing, the other cannot and will not exist. And to come back to one other thing that you mentioned about this confidence building, which oftentimes relates to communication is one of the things, and it kind of comes back to vulnerability, was, at least when I first joined Levels, my understanding of an update was a longform Sam strategy memo, perfectly formatted, punctuation’s perfect, hours of my time. And that’s not what an update is. And it’s interesting. And I think I had said this during our internal team discussion was when I took a step back and saw how you would give me updates, or even better how Sam would give me updates, it was something as simple as you said, FYSA, for your situational awareness, and just subtle things like that.

Or obviously at Levels, we love tools like Loom. The cognitive load to go and give a video update walking through something, the barrier’s so much lower than just typing everything out. And I do think there’s one other thing to point out here. I don’t think it means to just throw things over the fence. We don’t do that. Or we don’t say, “Let me know your thoughts.” I think what we’re talking about, it doesn’t have to be perfectly formatted, but we have to be really intentional on how we do these things. We don’t want to play, think of the document, you said hot potato, right? “Oh, now it’s up to you.” Really clearly, if it’s just informational, just put that tag with it, just so that everyone knows, “Hey, I don’t have to have response, but if I want to add something, then I can.”

Josh Clemente (49:29):

Yeah. I mean, it’s a great point. It can be intimidating to come into a different way of doing work and see some of the work product is so good. Some people on our team are just miles ahead of myself and others, in terms of the polish quality. And so, we can accidentally incentivize the wrong things. It’s like word count, polish, volume of communications, those aren’t the things we’re indexing on. What we’re indexing on is confidence, and actually I would argue the most efficient way to build confidence. It’s like that is what we should be thinking about and is the objective. So just simply writing more words is not the most effective way to synthesize a quick update. And actually, it’s probably taking the original minimal version of that thing and just bumping it over to somebody to just say, “Hey, this conversation’s ongoing,” or, “Here’s a quick note. Things are on track.”

It’s really low effort and high value to do those small little tweaks to say, for example, add to the subject line, “No action needed,” or “FYSA,” or to add, “Action required,” or use the tool Threads, where you specifically assign an action to somebody. That’s the best way to avoid this hot potato situation, where people get frustrated, because it’s like, “Hey, you keep sending me all this information. I have no idea what I’m supposed to do with it. Some of it you’re waiting on actions from me.” Again, to go all the way back to the beginning, it’s the responsibility of each of us to convey the information without increasing the burden on the other. There are easy ways to do this, doesn’t have to be writing a story book. It could just be a Loom accompanying it saying, “Hey, haven’t had a chance to finish this section of the document, but X, Y, Z,” and now everything is solved. So it’s amazing. We can leverage some really great tools. And everyone should constantly be searching for ways to be more efficient in building the confidence in others, that things are handled.

Mike DiDonato (51:35):

It’s funny, talking through this, different things are popping in my head. And since we talked about internal tools, like look at Threads, or maybe for other people it’s Slack. Forget the exact principle at Levels, but it’s like, “We’re calm. We’re not busy,” or whatever it is. And it’s understanding that we prioritize deep work for everyone. And we encourage people to put the minimal amount of notifications on. It’s like all of us at work, we’re in a notification dopamine heavy world. And I’d say that even this trust and more importantly this confidence is understanding that, “Hey, I can put my Threads notifications to mentions or response requested, and knowing that I won’t miss anything that I don’t have to, because I have the confidence in my team, that if I need to see something, or if I need to comment on something, that that will happen.” And that one’s really not just for the way we work, but I’m sure you can appreciate this product better than I can, but having to deal with all notification chaos, it’s, A, impossible to do deep work. And that cognitive burden and cognitive load of just thinking, “Oh, I didn’t get to this. Or what did I miss?”, it bleeds into beyond work. It bleeds into personal times as well.

Josh Clemente (53:17):

So true. That, “What did I miss?”, it’s devastatingly difficult. So many hours are lost, I think, in just keeping up with everything that’s happening in all these different channels for so many companies or just being on the call, because I need to listen in case somebody mentions something that’s relevant to me. That’s the distributed responsibility way to do this, is everyone’s got to constantly be on their guard, because otherwise they’ll miss something. And the alternative is I’m responsible for making sure that the people who need this information have it. And that’s it. It’s like, if we each all step into that role and identify who needs to have this information, of course, we’ll miss sometimes. We’ll be like, “Oh shoot, I totally should have included this person on that. I didn’t even think about that second degree connection.” That’s fine. Somebody on the distribution list will identify that.

They’ll say, “Oh, who else should be in this?” Boom, pull them in. It’s such a beautiful thing, when you can embrace, and Miz always reinforces this, but when you can embrace the joy of missing out, just seeing that there’s a lot of information, and I can hit dismiss on all of it, because I don’t have the time, and know that I’m not going to miss anything, that is a beautiful feeling. And it’s a freeing feeling. And I can get back to my deep work, and just know that we have the structure in place, where if there’s a problem, the right people are going to be alerted. That’s what we’re after.

Mike DiDonato (54:45):

What was it? Embrace missing out? What does Miz say?

Josh Clemente (54:49):

The joy of missing out.

Mike DiDonato (54:50):

The joy of missing out, I love it.

Josh Clemente (54:52):

Yeah. We have such a FOMO culture. Look, I fall into this as well, even on Threads, where I see all the unreads, and I’m like, “Oh, I’m going to read all of these.” I want to want all the information. I’m curious. But the balance of that is most of that information, it’s not actionable. It’s not important. And the highlight real is what we actually care about.

Mike DiDonato (55:16):

Absolutely, absolutely. Yep. A hundred percent. You put together this memo. Obviously, I know you got feedback from other people. But just curious, looking out at Levels rest of this year, two years, three years, on your mind, how you see… I don’t think the framework will change, but what do you see the evolution of the company is likely by the end of the year we’ll have more people than we currently do? I think we have 52 people right now. And two years from now, who knows? So I’m just curious, from your perspective, what [inaudible 00:56:03]-

Josh Clemente (56:03):

[inaudible 00:56:03] on this sort of confidence.

Mike DiDonato (56:03):

Exactly.

Josh Clemente (56:06):

The nice thing is that we’re putting so much effort into identifying the earliest signs of challenges and trying to fix them culturally. That intentionality can feel like a distraction for other companies, who aren’t all in alignment. We’ve built a degree of shared context and agreement, that this is worth investing in. The company is the product. So that’s nice, to not have to fight upstream and just be like, “We’re going to invest in culture to an inordinate amount.” And it will still be too little, based on the… Sam and I have talked to many founders, who are years ahead of us in the growth cycle, and all of them say the same thing, “You’re not investing enough in culture. And I don’t even know how much you’re investing.” It’s like, “Whatever it is, it’s not enough. I can guarantee it.” Because founders, early teams, founding teams, they invest too much in the product. Or the existential crisis is always around getting the product and getting it out there and distributing it, and it’s not on building sustainability.

So anyway, I find that the efforts we’re putting in are paying dividends. Although I have no way of predicting exactly what’s going to break in these sorts of confidences earned, specifically to say the confidence-is-earned structure or just the culture in general, cracks will show. I am confident that when that starts, a lot of people identify it. We have this culture of transparency, where we share that and we try something new. And so we’re evolving all the time. The Friday forums, we’ve changed the format pretty recently. And that’s a really main source of alignment for people. So to be able to turn the knobs and flick the dials around with something like that, that is core to the company, and find more scalability, make it such that we can have more personal connection and do asynchronous project updates, those are the sorts of things we’re doing to make sure that our approaches scale.

And that’s all I can say is just that, although I can’t necessarily predict what we’ll have to do when we hit 100 employees to make sure that communications scale, because, again, this is a non-linear problem, as Sam talks about in the Principles of Effective Communication memo, it is a non-linear scaling. So as we get to 2X the people, we have four to six times the communication channels. So it’s just hard to predict how that ends up manifesting in the culture. But I do know that the philosophy is solve the underlying principle. What are we trying to achieve with communications? We could easily say, “Send fewer emails. People are overwhelmed.” But the actual reality is earn confidence in your peers by making sure they have the channel available and the discoverable information is there. So it’s a non-answer, but I think that the point is that we’re trying to tackle the philosophical problems more with an actionable approach, rather than the specific process.