Balsamiq founder Peldi had a dream that he would create a business that ran itself from his back bedroom forever. It soon became clear that life was complicated by the success of the product. Many of the big decisions at Balsamiq have been motivated by a desire to nurture the Balsamiq user community while offering his distributed team a great place to work. Whilst they remain big motivating factors, as the company has grown to a team of 25, some of the assumptions that held true in an organization with a handful of people no longer apply. In fact, almost everything changes at 25 people.
Peldi returned to speak at BoS Europe 2017 to consider some of the big changes he’s tried as a founder, sometimes unsuccessfully, to continue to develop the business and retain the core values of the company.
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Interview with Peldi
Peldi Guilizzoni: All right! Ok, here we go! So listen! We have a lot of ground to cover so the speed is my goal. But there’s a little URL you can go and download all the slides. There’s a lot of the screenshots and this and that. So don’t try to follow too much, or just take pictures too much! But the slides are higher quality.
So here we go! All right, so this is the one thing that I say every time. If there’s only one thing you remember out of this presentation this should be it and it’s not mine. It’s Spolsky who was just mentioned. Four pillars of organic growth. So it’s an article he wrote for Inc magazine many years ago and no one knows about this but for me it’s what I think about every day. Basically the concept is that you have 4 things that all have to grow in the same rate. Revenue, employees, marketing and quality of the product itself. If one of these gets ahead of the other ones, you’re in trouble. For instance your product is you have very polished marketing but the product sucks, you’re in trouble and will have bad reviews. You have a great product and not have enough people to support it, you gonna give bad customer support. One key thing is try to make them all go at the same rate and this is if you’re doing a bootstrap or an organic company. So this is my bible pretty much.
And we’ve tried to do it! And so, grey is the revenue and red is the employee count and this is sort of the spread out revenue, I mean profits over the years. We’ve been happy to put away 2 million dollars in profits for the last 5 years while growing each year. And you can see that I spoke at BoS along the way and so today we’re there. Basically there’s been various phases of the company feels like it grows and it changes. And last time, I spoke in Boston, was fall of 2015 and we were really on the cusp of a change. So I’m here to tell you what happened in the last year and a half, ok?
I don’t really have a name for this phase yet cause we’re in the middle of it. But it does feel different. Once you hit 20-25 people, it really feels like a different beast altogether again. And no one talks about this stuff. You Google, and this is the kind of searches I do by the way. And you get these crappy results. Africa tech start-ups, what? No one talks about this stuff for a number of reasons. One is that when…even I don’t talk about it pretty much. When I started, I was alone, I had no one to talk to so I blogged. And that was my way to sort of clear out my own thoughts and get feedback from the community to see if I was on the right track. And it felt good, I needed it, I was transparent that way. Then at the beginning the transparency also helps you with your customers, they see you’re an honest person. This is the company page back when I launched a few months after and it’s just me, but this is what I believe. These are my advisors etc. And at that time it helps, the transparency really helped. As you grow, being super transparent is not so easy. This is from buffer, Joe spoke about. When you’re a certain size and you put out statements like this, as a customer who pays quite a bit of money to buffer, maybe it’s better if you didn’t tell me, right? Should I be looking for alternatives? Everybody goes through the ups and downs and it’s much tougher to share those when you’re bigger. So, that’s why I feel like people don’t want to talk about this phase.
Current Set of Worries
Anyway, I talk about it in this context. I only pretty much speak at this conference – no one else wants me. So here we are this is me at the end of my last talk, so we’re picking up where we left off. And things were going well, and it was all about the growth and it’s all online if you want to watch it of course and all the different phases that I showed. And now I was like well let’s see, my current set of worries is that we’re reaching 20 people. I heard and I read lots of places that once you reach 20 people, maybe you need to start having managers. Ok I don’t know. We’ll see. Maybe the standardisation models aren’t that bad. Who knows!
So right after the conference, super happy! It was a great talk and well received. And I go home and I write this little wiki page saying hey you know what things are going well. Why don’t we talk about something which may come at some point since we’re 20 people? Do we need managers? Why? What value do they provide, right? I mean I don’t know. Help me think this through, team. Cause I don’t know, we haven’t had them until now. Maybe we need them now, who knows? So I thought this was very innocent, the result was, I mean you have no idea. What did I say? I was just help me through, what’s the big deal? I mean, people didn’t and couldn’t come to work. They were so panicked. I’m not kidding, one person didn’t come for three days. What’s going on?
So I’m like I need help! I don’t know what I did, how to fix it. The sky is literally falling! And I’m like as always when I’m most panicked I go to my wife and she’s like I think you need to call someone to help you deal with this right now. I don’t know what but you know someone? She’s like how about Paul? So Paul Kenny, maybe you know him cause he spoke at Business of Software many times. And he’s a great guy, I think he’s British. And I call him up and I’m like Paul, I need help. I don’t know what to do. And he says slam on the brakes! Just let’s stop the bleeding, let’s talk people off the ledge first and he told me this is what you have to say cause I didn’t know how to say. So he coached me through a few meetings and in a week or so, we did that. And I said ok, I take it all back! Forget I ever said anything! I don’t want to talk about managers. Let’s make a little team – I asked for volunteers – of people who want to help me through. And we didn’t really have any problems, I felt like things are going well so what are we talking about? So anyway, we made a little team to say let’s see what do we have to do? We need to update our handbook with the way we work today cause we wrote the book when we were 10 people and now we were 20 people. And it’s just an internal wiki on how we do things, internal policies and stuff. And then clarify a few things, and clear up all this schedule as much as possible so I could focus on being a good CEO – I will talk about this later. So today, I’ll talk about what happened since, what we’ve done in the last 18 months. So it’s 4 main topics, and let’s get started cause we got a lot to cover.
What I should do as a CEO
First of all, what is the job of the CEO? Cause I think I say it every time, I don’t know what I’m doing. I never know. I think a lot of you feel the same way, a lot of impostor syndrome but in my case I don’t know what I’m doing. So this was my talk in 2015 where I say I’m a reluctant CEO, I didn’t start off wanting to be a CEO. I wanted to be just like these guys, Joel Spolski, Patrick McKenzie, Andy Brice. I had a small company but these guys had a one person company. He still does, he does perfecttableplan.com, a software to help you plan seating arrangements at weddings. So it’s got AI in it, it’s really amazing! That’s my hero! I wanted to have a one person company lifestyle. That was my dream when I started. CEO was not part of it.
Ok so when we got to six people, I was like yes! We’re done! I wrote a blog post saying my goal 2 year plan is for nothing to change! That was very cute! I described our company as a federation of freelancers, somewhat rowing in the same direction. I was just the part, one of the guys! My goal is always to be the dumbest person in the room. So I was hiring people that were better than me so that I could hang out with them and we would all do good work together. So the b word for Boss was forbidden at Balsamiq. I really hated it when the people called me the boss. I was like no I’m just one of the guys! And then at some point, this Valve handbook came out. You’ve seen it, right? It’s all about how they were 200 people and flat and gore and it’s also flat and I did all this studying on – this is great! We get to be flatter I don’t have to be the boss. So we spent 18 months trying to put this in place and that was exhausting! We tried but it was terrible so in the end I was like whatever. Fine! And this is 7 years into the business, this is me sort of giving up. So the b word is allowed now, not to my face. So we’re kind of flat still.
So back to this freak-out because of the manager stuff. Paul, either something is clearly wrong, I had no idea I’m doing it wrong, I still don’t know what I did wrong. What is my job at this stage? Please tell me! I’ve figured out how to evolve it until now but now I have no idea what I should be doing. So I hired Paul, he does executive coaching and we did 6 sessions to answer just this one answer which is what is my job? And he did the coaching thing where he had me do the homework. He said what do you think you should be doing? Isn’t that what I’m paying you for? Tell me! No, if you come up with it, it will stick! Yeah, right! I spent all this homework, right. Stupid coaching techniques. And of course it was crap and he threw it away but very gently, and he made me throw it away gradually.
I’m gonna save you time and money. I’ve got to tell you straight up, this is the job. This is the result of many hours of work and I put it all in – ok. So this is only one slide. I condensed it, it’s easy to remember and I sort of remember it. So your job is four major areas. The first one is people. So planning staffing, do we have the money to hire how many people? When should we hire them? What should we hire first? Do we have too many people working on a specific area? That’s never the case. So planning the hiring process. Defining the recruiting process, as you grow you have to make it as a process that’s always the same. Especially for us since we’re mostly remote, we had to come up with a handbook page with 20 steps on design the job posting, up until making the offer and the on boarding plan. Define your recruiting process is important and it’s the job of the CEO.
Then there’s employee development. Are they growing at the rate that they want? Is someone stuck? You have to keep track of everybody’s development cause if they don’t grow, Kathy Sierra says they don’t stay flat, they’re actually going backwards in their performance, so they have to continue to grow. You have to keep track of that and encourage people to do that and set the policies that make it possible. Then there’s engagement. How engaged is each employee? It varies, it’s like a temperature. So you have to keep track. That person is stepping away, maybe they’re about to quit. You have to figure out for each employee, keep the temperature of the business. That’s it.
Money and Policies
Then there’s money and policies. Finances, what’s the health of the business? Monitor. We have a quarter review of your profits and sales and costs and all that, right? Invest the extra cash if you had any, or decide to invest it by putting it back in the business – standard financial stuff. And then what I call Kaizen which is Japanese for continuous improvement. For us it means working on the company instead of in the company. So working on the policies, do we have all the policies we need? What should we adjust our day or is there a handbook up to date? That kind of stuff. So you kind of have to do that to drive the specific effort. Doesn’t mean you do all the work.
Strategy and Vision
Look at the market, right? This is something that I didn’t do at all, for many years. Are we going in the wrong direction? Cause I was one of those guys, head down, coding as much as I could and I never looked up to see are we even going in the right direction? I did it rarely and I hurt the business because of it. I realise now how important this is. I feel guilty about it cause this means watching BoS talks, right? Really, come on! There’s all this crap and I have to take the time to take two hours to think strategically, come on! It’s important because if you don’t do it, you’re hurting the company.
And then there’s the point about vision where you’re the one as a founder who has been there from day one. So you know all the history, all that’s been attempted and all that’s worked and not worked. And there needs to be one person that’s the keeper of the vision and makes it evolve the right way and communicates with the rest of the team. If this is all obvious to you, I’m glad that you have, you know this, but for me this was kind of a revelation.
And then there’s the marketing part, mostly about branding. Meaning in short, is the website up to date? Because usually your website conveys the image that you wanted to convey two years ago. And your website, your company has changed since. Maybe your vision has changed since? But the website is good enough that you only update it every 3-4 years. So it’s your job to say we need to tweak and redo it. And also, review the marketing community. Meaning, are we projecting the image that matches what people expect of us? Or not? Are we doing and spending the marketing money in the right position? There’s a bit of hands on work in marketing right there. So that’s it. Take a picture! That is all the CEO does! You too could be a CEO, look at that!
So, it was tough because it feels like it’s not really work, it feels like I’m getting paid for this kind of fluffy stuff? And getting all the money? Paid the most for this fluffy stuff? At least as a former engineer that was my feeling. But it’s amazing! We’ll talk about it a little bit.
Clear your schedule
This is the one thing that I struggled with the most cause he said you have to clear your schedule so you can do all these other things. So now I really feel guilty, I’m supposed to be doing nothing and get all the money? And then one week finally I finished my to-do on Friday at lunch. So I had a Friday afternoon and I didn’t know what to do, something that hadn’t happened in 9 years. I thought I don’t know, I’ll watch a Des Traynor talk from Boston a few years ago. Why not? So I watched this talk and I’m like oh my god! I’ve been doing this and this wrong and we must do this immediately! We’re going in the wrong direction! We wasted 3 months on this thing? Oh, I see. So you have to have a clear schedule so you can allow yourself to spend an hour doing something and then on the strategic thing and that will save your team a bunch of money and time. So it is, it does make sense and it’s really your job to do this. The team kind of relies on you to do this, this is what leadership is about. They’re ok with you watching videos because it does make sense for the business.
Stop trying to make people happy
And then this was another thing that was kind of a shocker that Paul told me. Stop trying to make people happy. I was like what do you mean? I’m the CEO, it’s my company, I hired all these people, it’s my responsibility to make them happy. He said you’re so naïve, happiness is an intrinsic thing. People choose to be happy or not. Same as how much they want to learn, right? They choose if they want to learn or not. Your job as the CEO is to create an environment where people who want to be happy and want to progress and learn can do so. They have the freedom to do so, they are encouraged and supported. But you can’t possibly be responsible for everyone’s happiness because you have 20 people now. If one person is unhappy and you’re feeling they’re responsible, it will suck all of your emotional energy on that person. And that happened when I introduced the management idea. For 3 days, this person was spinning out of control, I had to ignore everybody else cause I was very much, it was a failure on my part. And he said no, your job is to create the environment which is a little bit tough for me to swallow but I understand it now. So we’re still flat-ish. We took a shortcut. When you read about all the flat companies, they have sort of these draconian ways to stay flat all the way. But we take a short cut, we say ok we tried to be flat, if being flat is too much work, let’s take a shortcut and treat me as the boss. And you’ll see later an example on how we make this happen. And this is a good, for us right now it works well.
How we get stuff done
So now to the meat of the talk, how we get stuff done which could also be called people manager and bad. Project manager, ok, we can do that. So we made a group to figure out what we had to do and we made a list of things that we wanted solving and mostly it was chaos. Basically we didn’t have enough structure to be able to work efficiently.
One example is we didn’t know who was working on the project. Anybody could jump in or out at any time and that became a problem because if you jump in ¾ of the way we have to catch you up or send you away and neither of which are good. So we added a tiny bit of structure to continue to work and the first thing is team quarterlies. So each team, we have a team for each product and then we have a marketing team, tech support team, sales support team, gets together once a quarter and we do a meeting in which we do a table like this. The names of the team members on the left and it’s called the retrospective starfish because it’s five things. Keep doing, more of, less of, start doing, don’t start. And we get together and we talk about ok, who is working on what? We’ve reviewed the table from the last quarter and we make a new one for the new quarter. And this worked and at the end we come up with a goal as a team. This is the tech support team. And then we have a discussion and Mark wanted to make sure that I included the screenshot, I don’t know why.
So this was a great improvement for us because for the first time we had a page where we could put all the things from that quarter for each team and we had a visibility on what the company was doing, what the goal was for the company for those quarters. We’ve been doing this for 6 quarters now and it’s never perfect. Ship beta, ship beta for real this time. It’s ok, it happens.
So then we came up with this other thing where they said how about project managers? Cause to run these quarterly meetings, we need someone to take notes, someone to schedule it, etc. so we started making a list and then we quickly renamed this to team organisers because that way the word manager was not there at all. This is wiki classic. Super simple wiki, easy to use. So anyways, team organisers basically it’s a project management role. It’s coordination and communication and it’s an admin role, you’re not the boss of anyone, you’re the secretary. But it’s very useful. Everybody understood this, this worked. There was no pain and ache about adding project managers. They evolved naturally, some people who are more inclined to do these jobs and we did this and worked well.
Then we took it a step forward and we made this page and this is the page that made all the difference. We said the company is made of people and organised the teams and projects. Projects belong to a team and people have a primary job and they also have roles they play in teams and projects. And we’ll look at it more quickly. And it’s all very organic as you can see. So the primary job is what you’ve been hired to do. What the job description was when you were hired, tech support or something like that. And it does change, but somewhat rarely. Some people moved from team to team. Mostly developers they work on different projects or some people grow into different roles but that’s the primary job. And it’s your job to take care of that part of the company.
And then for teams, we came up with these definitions of roles. There’s the organiser, we talked about it before as the project manager for the team. And then there’s the lead and often is the same person but often the lead is not good at project management so they will pair up with someone. This is a person that knows a lot about a specific area of the company but it’s not very good at organisational skills so they pair up with someone else. Then there is ongoing contributors. People who do work that doesn’t belong in a project – it’s work that’s forever and insert customer tickets. And then there’s advisors and this is mostly for me, this way I get to go to all the team quarterlies and help them prioritise. And then there’s observer which we don’t really use but it’s more about training. If you want to see what that team does, you can go to the meeting as an observer but you can’t talk. Ok and for projects, very similar thing. Organiser lead, advisor, contributor, observer. Very similar.
And then in my ample spare time, I made a little react app with a backend and MySQL database, I still got it! In a couple of days I whipped it up and we called it in Italian for the room where the balsamic vinegar is made. And basically it puts it all together. It tells us these are the teams, these are their goals for the quarter, current projects for that team, future projects and then the people with the primary job. And so let’s go see a team, there’s the goals, some links. The contributors and then below the lead and organiser and then past, current and future projects coming soon, backburner that kind of stuff. Then for each project, you have a goal which we don’t even fill out, and then some dates and then who is working on that project. But the real beauty and the reason I built this is cause I didn’t know what to work on. So you go to the people page and it brings it all together. This is my homepage where I can see that these are my team roles and my project roles and I have 30 projects going on right now and then these are the future projects. If it’s yellow it means it’s a contributor so I’m not the lead for the project. I don’t have to worry about it. Somebody else is leading it and they will bug me if they need help. Red means I’m lead or organiser, it’s my responsibility to move the project forward. So this little tool gave us clarity. For instance we have 90-95 projects going at the same time in a company of 25 people. I don’t know if it’s right or wrong, it’s just what it is, but at least now we know.
Then we added this thing retrospectives. So in the app when you finish a project, you put the end date it talks to the wiki and it creates a new page for the project called the retrospective. And it’s a very simple structure, it has only 4 questions. We did these studies on retrospectives and then we came up with the simplest, silliest format. But it’s what went well, what could we have done better, can you think of anything we could do short-term to improve things, how about long term? And it takes the names from the app and then it puts them in there and then it sends an email to everyone saying fill this up in a week or two please. And then if we need to meet, we can meet. And this little thing is making a difference. We’re realising that we’re cementing or learning a lot more than before. We’re not finishing a project and then that’s it. Even for individual projects which we have a lot of it’s nice to be able to take 5 minutes and reflect on what went well and what didn’t go well. This is a simple way that we found to have retrospectives. Don’t call it post mortem’s cause mortem means death. Retrospectives is better. That’s how we do that part. Please hold! How am I doing? Perfect!
How we give each other feedback
So next is how we give each other feedback. So up until 10 employees didn’t even cross my mind. I don’t think I’ve ever mentioned a word and this is 3-4 years right? No one brought it up either because it was a small team – we really had one slack channel or one chatroom and that was it. And everybody knew what everybody else was working on and how well that job was being done and they knew what I thought of it. It was very simple and it’s like everyone being in one room. Then after 10 employees I noticed people started asking how am I doing? Am I doing a good job? It’s mostly cause I wasn’t as involved with them. They consider me the boss, but I was like I’m not your boss, dude. I don’t want to do this people stuff, I want to code. Just leave me alone! And of course what happens is that no one was thinking about people’s development and people didn’t get a raise for three years cause I’m not the boss. You want a raise? Tell me and I’ll do it, right? Who’s gonna do that? It’s stupid.
So after in 2014, so 6 years after launching, I decided to say all right, let’s put some structure in it and it was hard cause it meant embracing the boss role which I was trying to fight so much. So we called them quarterly catch-up meetings. They’re not reviews, they’re just little chats! And similar format, keep doing, more of, less of, start doing, don’t start. And we would make a table, private wiki page for me and the employee. We’d look at what you did last quarter or said you would do and what you did and we’d make another table for the next quarter. Then I would always ask these questions. How’s it going? How heavy is your workload? Are we on track with your professional development? Do you have any tough feedback for me? Are there any issues with any of your co-workers you’d like to discuss? Anything else you want to discuss? And once a year, let’s discuss your salary. And this worked for 3 years. Between 10-20 it was fine.
Then it evolved a bit. Nobody wanted to tell me issues with co-workers. So we changed it a bit. Can you think of what we could do to improve how we communicate? That helped. Then we did, then we said any tensions cause that wasn’t working too much. Then after watching Claire Lew’s talk at BoS, I added this. Do you think the company is the right size right now? And that was brilliant she said you should ask this. So started asking that. So then when I was still working with Paul, I was like hey look! This is how we do chats and it’s working well. And of course, he said very politely cause he’s British, basically he said this is garbage. Can you think of any way to make this better? Classic!
Again, so we made a little team with Paul’s help to come up with better questions and this is what we’re using now. I will show you the questions. Again, all the slides are online. But the biggest thing was back to you’re not responsible to making people happy. This is where it really rubber meets the road. It’s not my responsibility – those questions that I just showed you were a little bit of I’m the mom and you’re the kid, right? Instead he said you can open up the questions and make it so that it’s very clear that it’s their responsibility to be happy and progress. You’re just there to help them do that by listening, giving them feedback along the way, by creating the policies that make it easier. Including this one the fact we do one on one quarterly. So these are the questions now, how’s it going? How do you feel about your progress? What challenges have you have or do you expect? What are you proud of? A section with the team, what’s working great, what’s not working. What’s nice is number 5, where I get to say what should I as a coach do better to help the team, to support the team? Then there’s the whole professional development section which is about your own development, what you want to learn. What can I do as a coach to support you better? Then we summarise it and basically each employee, they’re looking at their own plan that they made for themselves the last quarter and they are making a new plan for themselves next quarter. The power dynamic is very different. Then there’s the employee can ask the coach how are you doing? Which is very nice.
The problem is with 25 employees 4 meetings per employee per quarter it’s 100 for me. It’s fine, it’s my job as the CEO but it’s 100. And so it’s a lot. So we made a little team to solve the Peldi does too many quarterlies problem, like we do. So the first step we did was we split the salary review from the meeting. So that you could potentially have the review with someone else and the salary still happens with me. We put these meetings into their calendar, they used to be in my calendar, they were invited. Now they were on their calendar and I was invited. No difference, actually there is a psychological difference. They get to move the meeting, I can’t reschedule it by myself if I want to anymore.
One thing that people were afraid of, I use these meetings to talk to you, hang out with you, I joined the company cause I want to work with you, am I gonna lose touch with you? We added the office hours. Every Monday from 4:30 to 6 pm, I keep it open for any employee to talk about whatever. It’s usually not about work, it’s just catching up, family stuff, just shooting the shit. And this one. This enabled us to add this where we say ok, if you want to do the meeting with not just Peldi but someone else as well, now you can. And people started doing it and they liked it and I was telling them tell everyone how great it is to do it with someone else. And it worked, so much that after a couple months, everybody said all right, I’m willing to not only doing with you but with someone else. And so we say you can ask any other colleague to be your coach basically. And it’s working. So I still do it with a bunch of people, I have my friend Will who is an entrepreneur in San Francisco and we do it to each other. We’ve been doing that for years. As you can see, people are asking their co-workers to be their coach. So now I do maybe 70 meetings a year instead 100. But what’s great is that it’s really cemented this idea that you’re in charge of your development and your happiness and it’s like you’re hiring a trainer at the gym. They are helping you get better but you’re the boss. You can fire that trainer and get another one. So we love it because it stays flat, it’s organic, because you can decide each quarter who do you want to meet with and then it scales and it’s in line with our servant leadership style. We love it and I recommend that!
The other thing we did was put in this policy which is a one line policy, if there’s a conflict or a difficult conversation the policy is deal with the issue directly with the person or people involved. If that doesn’t work, get Peldi involved. So this is the shortcut. Some other companies have policies where if we have a conflict we talk about it, if it doesn’t work we bring in a mediator. If that doesn’t work, we assemble a team of 6 colleagues just so that it stays flat. It’s ridiculous. We just have 2 steps, but this little silly thing is amazing because I get a lot less people whining. To me, it made a huge difference cause they know they have to get brave and have the conversation first and usually that’s where it stops. I haven’t had to mediate any conversation since, cause it’s clear and people have grown and they feel more brave. It just takes practice.
Then the other problem with not having managers is that it’s no one’s job at Balsamiq to tell anyone else you’re doing a great job. Motivating, it’s a part of what managers do. We don’t have that so instead we made another wiki page where you can self-assess. Am I doing a good job? And people were craving this, it’s amazing how people use this. So it’s very simple. We tell you reflect, ask yourself these questions like; do people trust me? Do they want me to be on their projects? A bunch of questions, you can read them later. And then we say reach out to your coaches, if you’re feeling insecure, ask Peldi, ask teammates And then be a good citizen, help others! Give them feedback all the time, right? And so this is silly but very are useful.
Policies we added
All right, last part a bunch of policies that we added, other policies that might be useful when you reach this stage, 20-25.
Let’s see, first we made, I expanded this wiki page to describe how I decide to give people raises. What’s the algorithm that I follow in my head when it’s employee salary review time, once a year. And this is great, because it’s giving everybody clarity on – makes those meetings easier cause this is still a dark art. And so this kind of explains it and it says what should I do if I’m at the top of my range? Cause we have senior people who have been here 8 years, right? So they’ve kind of plateaued and so we have some tips on how to deal with that. What should I do if I want to make more money? And it’s like go to a different company sometimes, but the easiest thing is to get more senior, deliver more, etc. So this was useful as well.
Then another thing we did is this professional development clubs. Really it’s chatrooms in slack, there are different channels, they have the C prefix underscore that makes it a club. Some people call this guilds, that’s too medieval for me. So this is rooms where if you want to get better at something you join the room and there will be links about that topic. What about writing and user experience? So whenever someone finds a good link online about a specific topic they put it in there. Then – we have like a club leader whose job is to take the stream of links from slack and put them into wiki in a nice format. So really what I’m doing is in a flat company I try to create many opportunities for leadership cause people do crave that. So you can be a team lead or organiser, you can be someone’s coach, a club leader, there’s a lot of ways that you can fulfil that need for leadership in a flat company. We’re sort of making it up.
Another thing we did was invest a bit more on teaminess because once you start hiring people at once, it’s hard to, you don’t know them as well as before. So we introduced know your company by Claire Lews who spoke a couple times here. And this is very simple. Every Monday, everybody gets an email and status update email asking what are you doing this week? And how heavy is your workload? So we have a status check-up, it helps me figure out how we’re doing. Every Wednesday is more of a policy question. What policy should we add next? And then it helps us think about the company instead of working in the company. Every Friday is a fun question like what’s your top guilty pleasure or a recipe that you like? So it’s a very simple thing but we really love it. It’s fun and effective.
Then we have the media club, it’s like a book club but virtual cause we’re remote. We say everyone go watch a rival and then we’ll talk about it at the meeting. We get on google hangouts for 30 mins and we just laugh for a half an hour and then we pick another movie for the next month. Really good! Then in our, we have a monthly all hands meeting where each team talks about what they did and below that in the page we have a personal updates table now where people just talk about their lives. As you can see from the orange, it’s all comments, right? Like my daughter had a performance at the orchestra. And everyone is like congrats! So it’s a very simple way to create more teaminess and feel like we’re all connected and friends.
Then this one stolen straight out of trello. Michael Prior talked about it in his talk here at BoS, this is where I learn everything if you haven’t figured that out yet. Basically you get 4 people in google hangout for 30 minutes every Friday at random with no agenda. We call it Friday fun times. And you put them together and they just talk and laugh and whatever they want. The random part is important so you talk to people you never work with cause once you reach the size that happens. So this is great! We do it every Friday.
Then I moved home. So we have an office in Bologna Italy with 12 people and the rest of the company is remote. And I live 5 minutes from the office but I decided to go full time remote. This is for a couple reasons. One is I wanted to feel what the experience of working remote was because we say we’re optimised for working remotely, I don’t want to make sure it was real cause it’s not easy. It gets lonely and I wanted to feel it first person. And then I wanted the employees in Bologna to get the same experience working with me than the other employees did cause they were getting an unfair advantage by having me in the office and being able to talk to me more. And this was great! I really love this.
All right, so my whole story is try to fight becoming corporate. Really. I don’t know why, but that’s kind of why I’ve been through all this trouble. I have a past in a large corporation and it was fine, but I wanted to be I don’t know, new and flat and organic. But now we have an org chart and here it is. There I am. Org stands for organism if you think about it. So this is the closest thing that I could come up with. These are our teams and people are working different teams. These are new hires that we’re hiring. And it’s good. It kind of work
Growing up hurts
But it’s not without pain for sure. As always growing up always hurts. For instance, we have a retreat once a year and for the first time where we all get together in the same physical location for a week and for the first time one person couldn’t come. And we didn’t move the date for one person, in the past we did that cause we were fewer. Now it was not, it didn’t make sense to move the date just for one person. So we knew that was gonna happen, it did. It was kind of sad. And even at this last retreat, afterwards, we use it to recharge our emotional batteries so that we can go back working from home lonely for a year, right? I’ve spoken to several people and myself included who felt like the retreat felt short, I didn’t get to have good conversations with enough people just cause we’re too many. Mechanically impossible. And it sucks but what are you gonna do?
Announcements, we have one channel called that and that’s the one that everything that comes out there you have to read. But now there’s 25 people in it, it’s expensive to post to announcements. You’re interrupting 25 people and 60% of our cost is employee payroll and stuff. So it’s very expensive so people use it less, so we feel less as a cohesive team.
This was great! We have a monthly Kaizen meeting where we talk about the company, what we should improve and we discuss policies. Over time we have great debates in these meetings as we have more and more people, crickets. The same people who were super passionate about giving their opinion about what we should do now stay quiet. It’s impossible to have a conversation in a large group cause we’re too many. It changes the dynamic, people don’t feel like they can speak up. Now we have to create a little team to work on this policy and present it – it feels different, more corporate sadly.
And then like now we know that we have 90-95 projects going at the same time, you can’t possibly think that you’re gonna keep up with everything that’s happening at the company. For a long time, being flat was great because you were free to follow whatever you want and people did. But now there’s just too much and it feels like you’re letting go of part of the company that you care about, but you can’t. And you’re doing damage if you try to follow too much because you’re slowing them down. Myself first.
Then this, reaching consensus really hard. I will give you one example. This is how we picked what week to do the company retreat. All the weeks, all the people and you voted. I can’t, I have guests. This is my anniversary so we ended up with one week that’s green miraculously after a lot of talking and that’s the week for the retreat. This was 2014. In 2016 a lot more people, a lot harder even though we’ve been trained to think green is good, but the dates are in April when the weather sucks. So we did one and everybody got umbrellas just in case. It wasn’t great. So now, they don’t know yet but next week I will propose that we change that to that’s it – 11 weeks after Easter. The first idea was 4th week of June and then there were 3 birthdays that week. So instead I said ok how can we make it change but within a range? So Easter changes so we follow that. Basically it’s the end of June, beginning of July. This way we know when it will happen from here to eternity. But there’s no discussion. I’m sorry, this is it. This comes from above. I hate that! So let’s say it comes from the admin team, all right? It sucks!
And personally, I have noticed that I have to tread much more carefully than before. I have to sell my ideas, before people kind of trusted me cause we had worked together a long time and was much more willing to try things out. Now if I propose a new tool, it’s like pulling teeth. I don’t know, I’m happy with the tool I have. People speak up cause there’s enough of them that they feel like they can overcome me. And they do and it sucks, but I have to make a pitch to my own company. Now I make videos, I made little videos and I post them in the slack so that I can reach everybody. What? I have to repeat myself over and over cause I can’t keep track of who I told what to. This I heard is very common thing.
And then again, similar like I have a pretty strong personality. And I’m very passionate about my ideas and also about being convinced that my ideas are terrible. But I tend to steamroll a little much and now we have a bunch of new employees that don’t know this about me and I have to be really careful cause I might hurt their feelings. Before it was a smaller group. They knew how to handle and ignore me and now I learned to be more polite. And then this is the other thing. After making changes incrementally, the change from doing the coaching with me to another one, that was my idea from day one. I was like, I will do too many, I have to do it in one step but I couldn’t. After the management thing, forget it! How about we add someone? How about I step away? It took months to sell this thing! That’s what you have to do, oh well.
And this is the main thing where like organisms the way they grow is they split. Cells, there’s too much to fit in one cell. You got to make two cells. It splits and splits again and again. And it’s kind of painful cause it goes from being we’re all one group to being if we’re all one group, we will be miserable. So we have to start caring about our little team but that’s a lot of letting go. We have to do this switch from company to teams. And we have to do it the right way. So the last thing I want to say is culture is the way, like Jason said. Culture is the way where we have to double down, this is when really matters, when you have these changes. And we had our company values from day one, always the same and we sort of evolved it a little bit where we talk about leadership and care for our customers. Anyways, this is our lighthouse. This is how whenever we decide to make a change, we go through and have a checklist to match our culture. That’s the thing that will not change, that can afford to not change even as the teams inside grow and split. I noticed how important this is. And now you sort of can sum it up with this is our culture. We take care of each other, we’re good people.
All right, so will it last? No. right now, I’ve been up here enough times telling you that what I tried failed to know that the next time I come over in a year or two, I will show you how this failed. But for the last 18 months it’s been working really well. Right now we’re adding 7 people in 2 months so we got from 25 to 32 and I only feel comfortable doing that because this works. The little self-managing fluid organic system works. For us right now it does.
All right, that’s the slides! Thank you!
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Mark Littlewood: Fantastic! Brilliant! Should we take questions or have questions on tables at lunch?
Peldi Guilizzoni: Let’s do a few here.
Mark Littlewood: But don’t fear if you don’t get a chance. Stick your hands up! Questions! Cool!
Audience Question: Hey! You talked about a lot of about splitting up into individual teams. How you manage projects across teams? How do you assign people? Do you take the leadership position on deciding who gets to go in the team and if people are not over-stretched?
Peldi Guilizzoni: Not really because we have that tool that helps us answer that question. If you see your page and you see that I’m already working on 30 teams, you won’t volunteer for one more team cause you feel it. You can see it. Before you didn’t know and that was one of the problems we had. And then I don’t think I’ve ever stepped in to say this team is wrong. People self-organise just like mitochondria. It works well, I haven’t had a problem with team organisations.
Audience Question: Hi! How did you decide when to start and stop projects? And do you kill policies? Cause you seem to be generating a lot of policies.
Peldi Guilizzoni: Right. I can only speak about my own projects because other people decide their other projects. It’s pretty easy. I mean usually when we have an idea, we add it as a future project and it sits there until it’s time, during a team quarterly to decide these projects are coming soon this quarter. We decide as a team. And then it comes to the project organiser to sort of work with the people on the team to figure out if they have time to work on it, etc. and then when it finishes it’s pretty clear when we ship something or it’s a blog post. How do we kill policies? We haven’t killed very many at all. I have it on my calendar once every 6 months to review the whole handbook and I don’t do it. It’s just too much. Well we do actually rely on new hires. First thing we tell them is your first week you read a handbook, if there’s something that feels weird or surprising tell me and we’ll talk about and put it on the list of topics to discuss. It comes up where we evolve policies quite a bit, but we don’t kill them cause we still don’t have everything. Right now we’re devising a policy for long term disability for our American employees. We didn’t have that and so we’re doing that. It’s definitely slowing down how many policies we’re adding, the handbook as a product it’s mature now. But that’s something to keep in mind, we should try to kill some policies just like killing features. It’s hard but necessary.
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Giacomo ‘Peldi’ Guilizzoni is the Founder & CEO of Balsamiq, makers of rapid, effective, and fun wireframing software. If you’ve been to Business of Software Conference before, you’ll know Peldi – he’s the friendly one handing out stickers!
Peldi’s been attending since 2010, and has spoken 4 times – giving us a unique behind-the-scenes look at the growth of Balsamiq from a one-man project to a scaling software company of 25 at his most recent talk at Europe 2017. Balsamiq is now 10 years old, with over 30 remote employees.
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