#168 – Why building an effective culture is crucial for an ASYNC company | Rachel Sanders & Michael Mizrahi

Rachel Sanders (00:06):

If you join a company that’s early stage, you’re moving quickly, you’re high growth, you’re still experimenting and that applies to not just the product or what you’re putting out into the world for your customers, members, et cetera, to use, but it also applies to how you work, what’s working, what isn’t, what works now, what doesn’t. The world changes so how does that play a role in everything? And so having those people that are saying, hey, I’m going to be a willing participant in this, I’m okay with a level of uncertainty that I might be working in Notion today and I’m going to switch to something else. I don’t really know what else you’re going to replace Notion with but that’s there.

Ben Grynol (00:51):

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. Earlier this year, that being 2022, I believe it was Q1, Rachel Sanders, CEO and co-founder of Routine reached out and was curious to learn more about the way that we think about growth. They’d been thinking about building out their growth team and had some questions around what exactly to look for. And so Rachel reached out again and had some questions around people ops. And so we thought, why don’t we do the same thing we did before? Why don’t we just record a podcast about it because it’s kind of our default thing at this point, which is half humorous but also half helpful. It creates content that helps a lot of people. And when we get questions in the future, it’s really easy to point people to that content and say, hey, we’ve already had a discussion about this. Start here and if you have additional questions we can always answer them.

(02:03):

And so Miz, Michael Mizrahi, who oversees people opposite levels, he and Rachel sat down and discussed all these ideas around people operations. How have we built our culture? How are we adapting it? What have we seen as far as step changes and phase changes as the team size has grown? What have we had to change? What have we had to evolve? What have we had to declare debt on? People [inaudible 00:02:27] debt that is. We do not have it all figured out. We don’t claim to and it’s something that we will reiterate over and over again. No matter how much experience our team might have at different companies, no matter how many times we’ve been through different phases of growth with these different companies, everyone will have a different lens on things. But it’s important to note, no two companies are the same.

(02:49):

Our past experiences cannot be extrapolated to the experience of levels. We are constantly figuring this out in real time. And so this was as much for Rachel as it is for us. It’s a great reminder to keep evolving, keep iterating, and know that everything is an experiment, not only companies in itself and the product they offer, but the way in which you built them. Anyway, no need to wait. Here’s Miz and Rachel.

Michael Mizrahi (03:21):

This originated from a Twitter conversation like a lot of things tend to these days, and happy to learn from you. And honestly, I think through the conversation you can kind of uncover some things that we’re doing. Would love to hear what you guys have done at this stage and just kind of trade ideas. But really, just the broad topic is people ops and scaling.

Rachel Sanders (03:39):

Yeah, that was my thing too. I can share what we’ve been doing but would love to learn from you as well.

Michael Mizrahi (03:47):

Great. Sounds good. So I guess some background. I know you’re a friend of the company, you’ve done a podcast before and are somewhat familiar with us. I’ll give you a state of affairs on our people, Oregon, our company at large that might give you some jumping off points to dig into. So the company’s about two and a half years old and we’re about 55 people as of now, August 2022. A lot of that growth has really happened in the last six to eight months, so throughout the course of this year. Before that, we were in the 20 to 30 range. And this last doubling so to speak really is starting to be like a different company. A lot of the things that we were really idealistic about early on have come to terms with reality and we’ve had to find the middle ground on what we want our approach to be.

(04:31):

We have a lot of really great ideas at the onset in terms of values and cultural principles and policies and approaches. And for the most part, we’ve been incredibly surprised by how well received that has been by each additional incremental hire joining the company. But then you pick your head up and all of a sudden it’s a big group and people have different opinions and different needs and want different sorts of things from their relationship with work. And so we’re navigating that terrain as we speak and there’s a lot of interesting opportunity, a lot of complexity, and it’s just a fun period to be growing out a company that cares about people and wanting to do it the right way.

Rachel Sanders (05:07):

Yeah, no, that’s really helpful context. And I didn’t realize how many people you guys had now, but I can see that. So as we said, it originated on Twitter, but we were a much smaller team, let’s call it like five to seven people. And then all of a sudden we grew and kind of doubled that and similar, things that were working stopped working, things that weren’t working started working and there was all of this need for thinking about what do we want people ops to look like? What does the culture need to look like? How do we create processes that supports that culture and how do we do it in a modern way? So we’re similar to Levels, async and remote. We’re not as async as you guys, at least the comments around what you all have done.

(05:58):

But things that we really care about. How do we protect deep work? How do we make sure that people are taking care of their health physically and mentally? How do we allow for people to take time off and build processes around that and how do we get the best out of people when they are at work? These are all questions that you think about from day one, but it really starts to come up the more people that you have.

Michael Mizrahi (06:25):

Yeah. What was interesting to me on that just watching the evolution of Levels, and I’m curious to hear how it’s gone on your end, is a lot of the answers to those questions came in the early days from our founding team and just the way that they thought of an approached work. And so we kind of all have our own experiences from past companies. We’ve seen what’s worked and not worked both as employees at companies, as folks who have founded past companies. So there’s a wide range of experiences, but one example in particular, we have a vacation and time off policy, very standard for companies in our industry to have unlimited time off. We’re all very familiar with unlimited vacation. But what we all saw in practice in our past roles was we had a limited vacation and never took any of it because there’s social pressure not to, there was always a million things going on, it’s never a good time.

(07:11):

And so instead of just going with that flow… I think this came from Andrew and a bit from Casey, two of our co-founders. Casey had a med school background. And so when she was off and not studying for boards or desks or things like this, she went off the grid. She went totally camping, hiking for five or six days, no cell service to the point where she’s cut off from email altogether, completely unplugged and disconnected, and that has had an impact on our vacation policy encouraging people to completely disconnect. And then I think the part that came from Andrew, I might be mis-attributing, was turning the unlimited on its head and maintain the unlimited but implement a mandatory minimum. So unlimited vacation, but you must take at least a week off per quarter. And that’s a way to kind of fight the system that has good intention but doesn’t end up working in practice in a lot of companies.

(08:03):

And so policy by policy, and I hate even calling them policies, but just these cultural pieces that are important and guidelines, we’ve tried to find ways to make them actually work based on past experience where they haven’t. And so it’s kind of a nice approach to take to now being able to build these processes and guidelines to put our own touch on them and learn from our own experiences versus go to the HR library, take the policy off the shelf, because this is how you do vacation at a large company, and throw it right on. And so that’s been the struggle is which ones do we subscribe to because they’re tried and true for a reason, and which ones are we going to completely reinvent and try and make them work for us? And we’re not always getting it right. That’s the tricky part.

Rachel Sanders (08:45):

I think it’s hard and it involves obviously with the number of people, the type of people, the work that you’re doing and what might work at X, Y, Z big company or X, Y, Z startup won’t work at Levels or Routine because of this reason, because we’re doing this differently. And I love that a lot of these have come from your founders and your founders experience because as a founder, one of the best parts of building a company is building a culture and a team policies that you feel work and that create an environment that you try to make people happy at work. You try to make people love what they’re doing, be at a place where they really want to give 110%.

(09:30):

I came from an investment banking background, which means that everything that I kind of think about today is an exact opposite of what went on in banking. We didn’t have unlimited vacation. We had vacation policies but no one took it because it’s banking. There’s FaceTime, there’s basically everything you think about kind of investment banking culture. But what was interesting about my role is that I actually worked with a group that was headquartered in Nashville while I was sitting in New York for two years. And so that was my first, I call it remote because I still went to an office but most of my interactions were over the phone, online, traveling to see people. And it was then that I realized that it doesn’t matter where you sit. If you have the right people in the role that know how to do the work, magic can happen regardless of where you are.

(10:27):

And Routine even before the pandemic started with that idea. My co-founder sits in Europe. We have been remote since day one and believe that if you hire the right people, you put up the right processes, you can create an environment that amazing work gets done just in a very different way than what traditional banking or a traditional large company looks like. And it also allows for people to, for instance, I work out according to my circadian rhythm which means from 2:30 to 3:30 PM I’m basically useless at work. I get up, go to my home gym or go take a walk and then I come back and I’m significantly more productive, and that’s just not something you can do in a traditional office in the way that maximizes each individual’s productivity.

Michael Mizrahi (11:18):

Would you say that as your company has grown those touches that are personal to you and are the kinds of pieces of the culture that you’ve touched directly are understood by others and how well received… It’s very easy for people to see on your calendar that this is the time that you work out and that sets the norm for others that they can live their own lives accordingly. You’re not checking when they clock in, you’re not checking when they clock out and so you kind of remove that piece of the culture. But some people prefer to work a very clear cut hours. They put in their nine to five, their 10 to six, whatever it is, and then they have a clear break at the end of the day and that works for them and that’s totally fine. So have you felt like the reasoning behind the way the company operates async has come from some of your behaviors? Has that permeated through or did it get lost at some size or stage?

Rachel Sanders (12:07):

It’s a good question. I think for the most part it’s permeated but this is one of those things that as you grow, and you mentioned at the beginning, people want different things and have different relationships with their work and timing. And so how do you think about accommodating all of that in a way that still holds up the founder’s original values as something we’re thinking about a lot? The other thing that came from banking culture which is not so great is that I’m pretty much always on. So even if I’m not on I’m on, and I’m checking emails, I’m working late night. So I get the hours in, but that’s not necessarily the best example to set all the time. And so how do you say, all right, we’re going to work X number of hours a week. Sometimes it’s going to be more, sometimes it’s going to be less, but you still want ultimate and ideal productivity because you’re a startup, you’re high growth. So where’s the balance? I mean, I’d love to hear how you all think about that. It’s something to think about on a day to day basis.

Michael Mizrahi (13:15):

This reminds me of quite a similar story honestly which is we work asynchronously, which means there is no working hours. Everyone’s on a different time zone, they work when it’s right for them. And we took that to the extreme very early on. We said, there’s no such thing as a weekend. There’s no such thing as a weekday. There’s no night, there’s no morning. Work when you want to work. It’s all async. Get back to people within 24 to 48 hours generally speaking. Sam, one of our founders works incredibly hard and incredibly regimented. His schedule is just cut on his calendar, every single minute is accounting for, and he loves work. He really gets a lot of satisfaction from building and growing and contributing and knowing that his time is well spent. And so there’s nothing that’s off balance for him. He’s perfectly fine working on a very deep strategy memo or sending communications on a Saturday morning.

(14:09):

And early on some people threw their hands up and they were like, that’s sending the wrong message because Saturday morning is a weekend and if someone gets a message from you, they’re going to feel like that’s now the norm of they have to respond and you’re normalizing work on the weekends. And we had some very good stewarded conversation around this and Sam’s point that he brought to the table was he’s still his own person. He understands that signals matter, but he likes to work during that time. And so the culture should allow everyone to work when it’s right for them and it should be understood that that’s acceptable. But as we kind of progressed, we did have to put in some guidance and guidelines to say, generally speaking, we don’t expect you to work on weekends.

(14:51):

We, in the beginning, didn’t acknowledge any holidays. We said, if you want to take off on July 4th, take off July 4th. Just let people know. If you want to take off on July 7th, let people know. That’s totally okay. You are your own adult. You make your own decisions based on when your kids are off or what you want to do. But it turns out that actually saying, guys, for the most part, weekends, you’re not expected to be there. July 4th, generally a holiday in the United States. If you’re in a different country, feel free to take it, feel free to not. So in our policy and in our guidance acknowledge that holidays exist and weekends exist, but as much as possible try to encourage people to find what works for them.

(15:29):

But it’s really hard, especially when you come from a traditional background or a different kind of company where those things are really clear cut. You want to know what working days are and what working days aren’t, especially when there’s need for collaboration when that comes up. And so we’ve gotten more specific about that even though it’s not as clean and crisp of a policy of work whenever you want.

Rachel Sanders (15:48):

It’s hard, right? I’m like Sam, I love working. I take my free time and I work. I rest and I travel and I take my time off, but I like to work. But there’s also a reason why we’re founders or early stage employees and how does that change as you go up? And I also think back to age, I didn’t love working this much when I was right out of undergrad. I wanted to know when my time off was. And so there’s all these different things, and then you have a kid. So I have a two and a half year old daughter and that just completely shifts everything as well. You have to have boundaries that are accepted to be able to have people who have families. And if nothing else, this pandemic has taught us that everybody takes care of children at home. Everybody needs some flexibility if the nanny decides to get COVID or somebody calls out or something like that happens. And so boundaries, setting time but also allowing the flexibility is this constant change.

(17:04):

And something I also heard and I think really resonated with me and I’m sure this is true, startup founders, the CEOs or managers, if a manager or a CEO sends you an email on a Saturday, even if they say, I don’t expect you to answer this until Monday, it creates a sense of urgency for the person receiving that message that may or may not need to be there. And so one of the things that I’ve started doing is I’ll schedule messages on Slack, I’ll schedule emails on Superhuman and I will create boundaries around, all right, we’re launching or shipping something, I’m probably going to email you on a Saturday, or we’re probably going to be talking. But otherwise, if I’m working on the weekend, I am not expecting you to work on the weekend unless it’s clear. And even then I’ll schedule messages.

(17:59):

And that’s something else we’ve talked to kind of my leadership team around as we’ve filled out on more people because you start out a small company, everyone kind of runs something, no one’s really managing anyone and then all of a sudden you’re managing a bunch of people. So how does that trickle down to the org is something else. But yeah, I’d love to hear, how have you built that org structure? How have you thought about management? Because from day one when there’s no weekends, there’s no nothing, you have 55 people, there’s obviously an org structure and a management structure. How do you kind of tie that together?

Michael Mizrahi (18:34):

Yeah, let’s get into that. But before that, I wanted to make a note on something you mentioned about scheduling emails and being mindful of when a message is sent versus how the receiver receives it and I guess some background that’s helpful. Earlier in my career I spent a bunch of time at Uber, and Uber’s a really interesting business especially on the operation side because 24/7/365 days a week you have cars on the road. There’s rubber tires crashing into other things, there’s people getting into altercations, there are lost items that need attending to, and I was very much on the operation side and mindful of all these things that could happen at any point in time. And so being super responsive to email and super aware of what was going on in a realtime business wasn’t like a workaholic thing, I can put in all the extra hours. It was essential to keep the entire city moving.

(19:25):

If there was a massive rainstorm coming and surge pricing was about to go on, the entire New York Ops team was plugged into that and knew exactly what to do. And that taught me some really interesting lessons early on about what it’s like to run a business that operates in that fashion. And over the course of time and different roles at different companies, I ended up landing at Levels and in any startup or tech company today, tech company rather, software product, you have members using your product all the time. And so uptime matters, but you have alerting and analytics for that and you have a support team that’s on call for a lot of these things, but it’s not a real time business in the same way. And so I’ve learned that there are extremes and realized that this isn’t one of them.

(20:05):

And so changing the equation on whether the sender needs to be mindful of the receiver receiving the message, my antidote to that and what we encourage people in onboarding to do is find the notification settings that are right for them. If you have decided that you’re not working the weekend, then don’t have notifications on your email or on your Slack or on your Threads. Just turn them off. Absolutely turn them off and don’t check the app, and that’s a really hard behavior change for people. And then when you log in on Monday morning or Sunday night to get ready, you see what’s on your plate and you tee it up. But you don’t let those interruptions run your day, you take control of when you want to interact with them. And then if something was sitting for two days and it came from the CEO and it wasn’t urgent, if it was they would’ve contacted you and otherwise you handle them and you handle it and that’s built into the async culture and everyone knows that’s okay.

(20:54):

And so it’s just resetting those norms and standards and reinforcing them constantly. Because with every person that joins, they bring history, context and baggage from their last company and that starts to permeate. Even as someone who’s a manager that comes in and then has folks on their team reporting to them, their own management culture starts to seep in and that’s not coming from our founders, right? Everyone brings their own. And so the company culture really needs to stay strong, otherwise you really get a lot of drifting on that. But to your question, what does our people abstraction look like? So we’re about 55 people today and I think we’ve gone about… We have two very large orgs with a lot of individual contributors that have managers. Those would be engineering and then the support and there are some sub teams within there in terms of engineering like mobile or backend.

(21:42):

But on the whole, we have probably about a dozen people managers that had at least one or two direct reports, if not up to maybe six or eight or so. And those managers are responsible for being in touch with their individual contributors, making sure that folks are on the right track. Something that we’ve really tried to build in is the concept of everyone being the DRI of their own career. And so your manager is there to help guide you and provide support and help facilitate feedback, but you’re your own person. You’re responsible for your own performance and you can’t rely on your manager to be the fail safe there.

(22:15):

So if there are projects that you want to take on, things that you want to step up for in terms of responsibility, you’re free to move about the company and do that. Your manager is not the gatekeeper there. So I speak about managers as part one of the people org. And then of course there’s all the backend company side of people, process, culture, and we can get into some of the details there. But manager of the frontline in terms of making sure that their people have a connection to the mission, are excited about their work, are focusing on the right problems and have enough to work on if they do need that kind of guidance.

Rachel Sanders (22:49):

And how has that worked, the be your own person and have the guidance, especially as you’ve grown?

Michael Mizrahi (22:54):

It’s been a learning process. I think early on when you’re a dozen people and everyone you hire fully understands that they’re joining something super risky, they’re going to be somewhat on their own in this startup, they take on a sense of ownership of their work and of their career and what they’re working on at the company and how they’re contributing. But over time, I guess a really practical example, we didn’t have very explicit rating systems for how you’re doing. We kind of expected you to know how you’re doing. You should know. Ask your peers, figure out if you’re contributing, see if your metrics that you care about are moving in the right direction. You’re essentially your own founder of your own function, so own it.

(23:34):

And then we picked our heads up and did a culture survey or two and figured out people do want to know how they’re doing and they want a rating delivered to them from their manager in most cases. And so what worked and clicked for very early employees starts to weigh in as the team gets larger. And so now we’re implementing really explicit scores and ratings which feels big company, but people want it. And so that’s a change where you’re still in charge of your own career and you still have total autonomy, but if you want to know how you’re doing for a sense of security we should just do that and we shouldn’t stick to our principles here if they’re not serving.

Rachel Sanders (24:12):

I think that goes back to what we were talking about at the beginning is what are you going to take from big company versus not? And it does seem like guidelines around performance is something that the majority of people benefit from. And even if you’re someone who can do it without it, you probably have clarity on metrics, clarity on culture related performance, and so ensuring that is at least in place is really important. That happened with us as well in a sense that we didn’t really do performance reviews, we didn’t do a lot of the standard management, big company management practices, and we brought on some more people that were more used to standard big company management practices. And not only did the lack of it create confusion, but it also created performance problems. It went in the wrong way because if people want to get clarity around things they have their own stories. As you said, people come with their own baggage, with their own experiences and those experiences create the stories that they understand without clarity.

(25:31):

And so that’s the key message that I have learned over the past six, eight months is that the more clarity around performance, around KPIs, around metrics, around how we think about culture, what does it mean to be a high performer at Routine, what does it mean to be results first versus FaceTime first, creates those guidelines that allow people to be a little bit more creative, be more of a go getter. Say, hey, I think we should go do this because it’s within the bounds of what we’ve said is okay.

Michael Mizrahi (26:06):

Yeah, that makes a ton of sense. The other theme that’s come through here then applies across all of this is that I think it’s very easy, it was very easy for us in the early days to be super nuanced and detailed about our philosophies and approaches. And as the company has grown, it’s become obvious that we just need to be much more clear and to distill these into much simpler terms and approaches. And so it’s great that we have a multi thousand word memo about how we think about performance or how we think about team building, but at the end of the day people want to know, do we do meetups or do we not and how do we do that? Versus the philosophy behind it. And we’re a very deep, thoughtful culture and I think that’s what attracts a lot of people to our team. They appreciate that intentionality and that level of rigor and exploration.

(26:57):

But also we need the simple version of it because to start reading all these long form thought pieces when you just want an answer of what’s the expense policy? Can I buy this or not right now? You need a very clear answer and it’s hard to get to those simple answers if you haven’t done enough thinking to distill it that way. And so it’s really hard to do that but that’s I think what makes the culture strong is when you can do that in all the areas and have clear enough expectations and clear enough guidance that are backed by deep thought but not giving that to everyone because not everyone wants that at every moment.

Rachel Sanders (27:33):

So it sounds like you all really started with the deep thought philosophy pieces and then you’re kind of seeing where the biggest questions come in and then clarifying those based on what the feedback is.

Michael Mizrahi (27:48):

Exactly. And I think what’s interesting and maybe different is that I’m not saying that other companies aren’t also very thoughtful about these kinds of things, but we tend to be very transparent about it. And so if we’re introducing a fertility or family planning benefit, there’s a long document exploring the history of these programs and exploring what the right options are and what the right bounds are and input from advisors that we’ve gotten. And it’s incredibly thorough and interesting, but also someone wants to know what the policy is. And so those end up becoming two separate docs whereas in the early days it was just the long form doc.

(28:25):

But because we share that with the company and we share the reasoning and the thought process and the discussion that happened… In most companies you just get the rule book, you get the handbook at the end, you don’t know what actually went into it. We’re showing our cards here. That’s not necessarily confidential or private, but in doing that we open up a lot of complexity because you’re inviting people into the conversation where the outcome was decided which is interesting. But again, time and place matters.

Rachel Sanders (28:53):

Yeah, no, definitely. How has the tools that you use to run remote and async, the philosophy around meetings, how have those changed since the earlier days? I’d imagine what you needed when you were 10 people is very different than what you need when you’re 55. So yeah, I would love to hear how you’ve thought about that.

Michael Mizrahi (29:19):

Yeah. Most of the tools have stayed consistent. The way in which we use the tools has changed and the, I don’t want to say enforcement, but reinforcement maybe of the norms and practices constantly needs refreshing. And so our stack I guess on the people side, Ripley is our HR tool, that is irrelevant here, Notion is where we keep all of our company content and documentation for the most part, and then Threads is the communication layer on top. So the way in which we use those tools and found their breaking points has been interesting. Somewhere along the way we were on Slack before we were on Threads. We were using email on Slack and we quite openly got rid of Slack, got rid of messaging, got rid of async comms, masquerading async comms, all these kinds of things and moved to this async Threads tool where we’re hitting the limits based on our size and just changed the way that people use it constantly, but it’s always a battle.

(30:23):

With Notion, for example, what used to be a handful of simple docs in a simple page tree structure has now turned into this massive handbook that needs constant updating. There’s databases, there’s 55 people using it which is very different than 10 people using it. So the amount of gardening and maintenance that you have to proactively do is important, otherwise it goes into complete disarray and entropy takes over and it’s a big mess. And so we’re very, very proactive on managing and maintaining all of our tools and systems and making sure that they work for people. We’re not scared to experiment and try new things when it comes to some of these tools and processes.

(31:01):

And luckily, because we make clear in some of our recruiting and onboarding processes that when you join the company you’re excited about metabolic health, you’re really good at the role that we’re hiring you for and you’re really excited to help us build a company and build a culture. That third part is important because if we start throwing in these changes and you’re just like, I just want to do my work, stop changing the way I do my work, that would kind of fly against some of the culture and some of the iteration that we do that ends up leading to better outcomes. So we have 55 willing participants to take on our experiments so long as they’re not too disruptive.

Rachel Sanders (31:36):

That’s such a good point to add that and I think that we hire for that, but it’s not explicit in kind of onboarding or in the hiring piece of it. So I love having that because if you join a company that’s early stage, you’re moving quickly, you’re high growth, you’re still experimenting, and that applies to not just the product or what you’re putting out into the world for your customers, members, et cetera to use, but it also applies to how you work, what’s working, what isn’t, what works now, what doesn’t. The world changes, so how does that play a role in everything? And so having those people that are saying, hey, I’m going to be a willing participant in this. I’m okay with a level of uncertainty that I might be working in Notion today and I’m going to switch to something else. I don’t really know what else you’re going to replace Notion with but that’s there.

(32:33):

I mean, we shifted from Google Docs to Notion which has been a massive unlock for us. Google Docs is a nightmare. But I can see even now it gets messy and everybody has a different level of organization abilities or concepts of how to organize or views on how things should be organized, and so you really have to have those clear templates. This is what’s happening here, this is what’s not happening here. You’re not working on Google Docs on your own computer so that if you’re out of office, no one can find anything that you’re doing. You’re working in Notion but how, where, what are you putting in? All of those questions are still something that comes up as part of it. And how do you all think about… I’ve never used Threads, but how do you think about missing the synchronous communication that comes from Slack or having more meetings that is big company culture but also human interaction culture building.

Michael Mizrahi (33:49):

One thing to add on the previous note is that it doesn’t just apply… The concept here, these changes don’t just apply to the tools that we’re using but also to some pretty foundational parts of the company. We introduced the concept of leveling and ascribing levels to people after half the company joined. And so all of a sudden we’re adding structure that defines your role that didn’t exist before that now you have to live with.

(34:22):

Of course, we want to get that right and be fair and calibrate correctly, but it’s getting people comfortable with the fact… We’re building the plane as we’re flying it and there’s going to be systems laid on that because you were early here, you predated and having the respect for the process of we’re all building this and we didn’t buy company template off the shelf and just plug it in on day one. You add these things over time and that makes it really complex because people joined at different moments and their assumptions about what work was need to change as the company adds more structure and as you add things like managers to be honest and getting everyone reported to the CEO until a dozen or so people. And so you keep changing the structure and being okay with some of that change is part of the challenge.

Rachel Sanders (35:11):

It’s hard and there’s some early stage employees that are truly very early stage and as soon as you layer on any of that structure or change the communication with management or change the communication with the founders it can be a challenge. You have to think through that as you’re putting more in place because as a founder, as people ops, as operation people, you know that you’re setting your goal… Your goal is to set up the foundation for future growth in making sure everyone both today and whoever you’re bringing on is set up for success. But that can create some headaches for the people that are there today, especially if they’ve been there from when you were 10 people all just kind of working on stuff.

Michael Mizrahi (36:01):

Exactly. And there has to be an immense amount of trust that it’s for the good of the company and for the good of the future of the company while still caring about the people. But at some point you have to make some of these changes because everyone agrees that there’s not a world where 55 people report directly to the CEO and have the right level of management and guidance, right? At some point there’s a breaking point and so where’s it going to be and who understands that we’re all in this together and we all have to-

Rachel Sanders (36:27):

I can envision the chaos that would ensue if that was the case.

Michael Mizrahi (36:32):

Yeah. But if you play all these things out, they end up looking that ridiculous and that helps make the case that, okay, we probably do need to make a change and this is probably the moment where it’s right and this is what that change will look like that’s reasonable. To your question on sync versus async, Slack versus Threads, when to get on the phone, when to not, we deal with this question every single day. We haven’t answered it perfectly, but we have some principles that guide us which is async first, not async only. And so there are times and places where sync makes sense where something needs to be high bandwidth, where we need to really transform a lot of information together, a brainstorm, problem solve, make a decision. There are clear points where that’s necessary and we make it a little bit uncomfortable to schedule a sync meeting it. It’s not quite a faux pas, but you have to go through some legwork in order to just throw time on “someone’s calendar”. We don’t really take to that well if someone just throws something on your calendar and so we slow roll that.

(37:33):

But if anything can be async we do it async first and lead into that. But if a project is forming, something’s kicking off, something’s hitting a snag and we can’t solve it async, we’ll go sync to address that directly. But the important part here is we want to respect people’s time, respect the way that they work, allow them to work deeply, respect time zones. We have folks from New Zealand to Lisbon across Europe, across North America, South America. And so scheduling meetings just ruins people’s days in terms of where they have to be. They’re working all the same, but when you have a meeting it really interrupts your flow and so we try to minimize that. And then using really strong tools allows us quite a bit of leeway. And so a tool like Loom which I think you’re familiar with.

Rachel Sanders (38:24):

Yeah, we use Loom.

Michael Mizrahi (38:25):

We use nonstop. So just endlessly use this tool throughout the course of the day, maybe a dozen Looms per day for someone communicating. They’re in poll requests, they’re in email comms, they’re sent out to partners. We’ll go back and forth with a few Looms and just use the tools available to us to do anything possible async until it’s clear that we have to go sync and then we do. Slack has a lot of pitfalls that we wanted to avoid. The always on, the presence [inaudible 00:38:59] with the green light if you’re online or offline and just always having it open. We tried early on to put in a lot of guardrails around using Slack responsibly, not using DMs, turning off notifications, only checking it once per day which we hoped would work but in practice… If someone comes from a past company where they use Slack, they know exactly how to use Slack and your guidance is not going to change it. It’s too easy to send that quick question, blah, blah, blah as a sender and not think about the receiver, searchability, all these things.

(39:28):

I think we have half a dozen blog posts about our switch off of Slack specifically that I’ll share. Yeah, that’s been our approach is to lead into an async tool like Threads which is like a forum, it’s like a Reddit essentially where there’s forums for each topic or team and then threaded communication comments below that makes it visible, it’s not hidden in people’s inboxes. It still results in a problem where people have a lot of comms to triage, but that’s a trade off we’re taking for now until we find something better.

Rachel Sanders (39:59):

We have some folks on the team and I like it now and I continue to assess this, but having a place to chat throughout the day is helpful for culture building and helpful for team communication outside of work. And so we keep it and we like that and we do some things within Slack. We use Donut, we allow it to be kind of a virtual desk or a virtual chatting. That’s not the most productive thing but we do have people go on deep work. We know that Slack isn’t an immediate solution. So if you’re looking for a question and it needs immediate answering, we all have our user guides but mostly that means a text or a phone call to our actual phone.

(40:44):

Slack is more like 24 hours if it’s during the normal weekday, if it’s not then it’s a little bit longer. But I can see it already as we’re scaling. Conversations get lost. If you’re using it for work, you can’t search, you have to ping people. Where was that? Where did you say this? What channel is this in? How do you think about that? This has just been happening I’d say in the past couple of months and I’m now starting to think, all right, is Threads the right answer? Is there another answer that it… It doesn’t belong in Notion because it’s not a true document, but where does it belong?

Michael Mizrahi (41:24):

Slack isn’t all bad and I think we’re probably extremists in our approach and philosophy here. We’ve certainly lost some things that we had in Slack. That informal communication, that informal water cooler chatter was really valuable and people really missed it in the beginning when we switched off. We spun up a company Discord after we left Slack as just like, this is only social, if you want to talk about parenting or dogs or new music and it had all these affinity and interest based channels within the Discord. But because people weren’t going there for work, it just kind of died. It just kind of fizzled out. And so we’ve had to overcompensate on the people and culture side to build connection because we don’t get that out of Slack and we’re not perfect there by any means. We’re still working pretty hard on that. So something like Donut which we love which pairs people together for a one on one or for a small group chat once a week, once a month, people that might not normally interact. We’ve moved that over to Threads and we run a manual process.

(42:24):

We have a team of exec assistance and one of the monthly tasks is get everyone into a spreadsheet and pair people up for Donuts manually because that’s important and we want to keep doing that. We have a water cooler forum which people can post interesting links that aren’t related to work, but it happens a little bit more slowly and you don’t get the quick back and forth where people are trading jokes and building on each other. And so there’s one weekly sync meeting that we have which is optional. It’s our Friday forum and the Zoom chat during the Friday forum, just lights out. There’s all this pent up excitement for people to interact and make jokes off of each other and play off of different things. And so the desire is really there and we just can’t find the right place to unlock it without compromising the deep work focus and the prioritization and trying to minimize distraction. So it’s not an easy challenge to solve.

Rachel Sanders (43:15):

It really depends too on team size and how you’re thinking about it because there’s going to be, and I see this and I know this, there’s going to be a breaking point when we hit X number of employees that chit-chatting on Slack is going to be very detrimental versus helpful to kind of culture and productivity building. So making sure that you’re at least thinking about it and seeing, all right, this is kind of what we expect. And that’s one thing too that I’ve started to think about is like, all right, we’re here now but when we scale, what is my guess or our guess around how many people… At what point is this going to break or is that going to break? And let’s think about what happens if that breaks now and have a plan around when this breaks or this is what it could look like when it starts to break. Instead of having to pick up the pieces and solve the fire or fix the fire, you already kind of have this plan, solution there.

Michael Mizrahi (44:21):

That’s been one of my observations honestly which is I think there’s all this… Our industry and startups in general that are venture backed and growing and adding headcount, you’re thinking about scale. You know scale is coming. You’re planning for it, you’re growing. You’ve worked at companies that have scaled before so you might have seen or your employees might have seen what that feels like. But there’s no milestone or sign on the highway that says this is scale, step five. You don’t know that it’s happening until you hear a few things and you kind of piece together, like I think comms are breaking down or I think this cultural issue is now more important than I thought it was. And you just address those constantly, constantly, constantly iterate versus V five of the company is rolling out tomorrow because we’ve unlocked level five scale and so everything changes on a dime. The constant iteration and tweaking and mindfulness and attention to what’s working and what’s not and what could be better is almost the only way to keep up with it because it’s not as discreet as we talk about it.

Rachel Sanders (45:21):

Yeah. And it’s not a certain number of people either. It’s team makeup, it’s how your team is built, where the people are, in what departments? Is it a lot of managers? Is it a lot of individual contributors? So all of these factors play into it. And so you’re right, it’s about having some thoughts, having some guidelines around it and then reacting when you need to. And then it goes back to that bring people on that are willing to go on that journey with you or else it can be problematic.

Michael Mizrahi (45:53):

Yeah. And everyone’s idea of what a startup is is different. I think a lot of people have different experiences and they join different stage of startups. You have people that were doing a thing with two or three people in some rented desk in a WeWork, and then you have someone that was at a 15 person startup that was funded and those are just very, very different experiences. And then you have people that were at large but small companies that are excited about the idea of startup, but the realities of the day to day aren’t always awesome. And so you kind of have to meet everyone where they’re at and bring them along to where this company is at at this moment versus whatever they’re anchored to.

Rachel Sanders (46:32):

Yeah, no, it’s right. And startups today are very different than they were three years ago, so you never really know.

Michael Mizrahi (46:40):

I’m curious from you, what does your people team look like and how much of your time do you spend on this versus product work versus other parts of company building? How have you thought about building the function and when does it become something that you are comfortable passing over to someone else that you trust deeply versus something you want to hold close forever?

Rachel Sanders (47:00):

Yeah, it’s a great question. I spend a lot of my time thinking about it right now and we’ve also brought in some people that are specialists in people ops specifically for VC backed high growth people ops. I have a lot of really good skills and things that I love diving into. People ops has never been something I’ve done before and so this was something that is so important that I quickly saw myself doing a lot of it, spending a lot of time on it and recognizing it made a lot of sense to bring in some other folks, mostly to kind of brainstorm with, think about, all right, what’s worked at other companies? What hasn’t? What makes sense for this stage? How much processes, policies, how much do we need now? What do we need to put in place? What do we need to put in place in six months? How do we think about this? And just that has decreased the amount of time in my mind that I’m spending on it and able to work on product, finance, commercialization, all of the other stuff.

(48:16):

I think the thing that’s going to be the hardest for me to fully get rid of is FPNA, but that’s because of my background and trusting someone else with that is going to be hard. I mean, we have a team that does some of it, but end all be all, I still run our model and probably will for a while. And otherwise I try to bring in experts. I say one of my favorite parts about being a founder and CEO is firing myself from roles when I’m bringing in people that are much more experienced than I am. I like being the dumbest person in the room. I like bringing on experts and people ops is no different. It’s something that obviously makes your organization run and so we haven’t been shy around finding the experts, bringing those people in and figuring that out. Right now that looks like people ops consultants. When that looks like internal full-time people ops, probably soon in the next six to 12, six to nine months, but that’s still something we’re evaluating.

Michael Mizrahi (49:29):

Are all of your employees US based or global?

Rachel Sanders (49:32):

No, we have people really everywhere.

Michael Mizrahi (49:35):

Do you use a PEO or any kind of EOR employment structure or is it all direct is really the nitty gritty that I’m curious about?

Rachel Sanders (49:46):

It’s different for each people. The majority of our team is in the US and so we basically use normal US based employment staff for those people. And then on a case by case basis, we have a couple people that work outside the US, so that’s something else we are kind of looking at as we scale the team.

Michael Mizrahi (50:06):

Cool. Yeah. We’re figuring out our company structure now around some of the benefits and insurance offerings and figuring out the right way to offer that with minimal overhead, the easy things. A couple dozen people of enrolling in insurance is one thing, and then when 55 people and their dependents are relying on your insurance being properly administered, you got to get it right. You can’t mess those things up.

Rachel Sanders (50:33):

Yeah. We use Gusto for a lot of our stuff now, but we’re at the size that it makes sense to do that. But you’re right, as you start to layer on benefits and that piece of it, it’s so important and you want to make sure that your team members are getting everything that they should be getting, they’re dependents are considered and you’re setting up a situation where people are excited to be a part of and they’re protected in the ways that they need to be based on who they are, and that’s hard and you need people that know what they’re doing to do it.

Michael Mizrahi (51:07):

Yeah. Employers have a lot of responsibilities these days that really affect people’s lives. I’m going to have to take that seriously.

Rachel Sanders (51:14):

Yeah, exactly.

Michael Mizrahi (51:16):

Cool. Well thanks for the chat, Rachel. Really nice to meet you. Love hearing the questions, the experience, the conversation. A lot of it is incredibly relevant and helps really frame and shift my perspective on it. So thanks for doing this, I really appreciate it.

Rachel Sanders (51:28):

Yeah, thanks for inviting me on. Hopefully this is a good podcast. I love how you guys do the podcast and just have these conversations. It’s also way easier from a… I’ve been on a lot of these at this point and the ones where you can just have a conversation versus being peppered with questions is so much of a nicer experience and it’s really helpful. People like us have these conversations offline all the time and so being able to record them and allow other people who are building or who are interested or who have these same questions just brings this level of everyone can rise which is so helpful.