employment
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More companies should shift to a work-from-home model
Nearly three in 10 employees (29%) would quit their job if they were told they were no longer allowed to work remotely, according to a recent survey. In addition, a recent Harvard Business Study found that “companies that let their workers decide where and when to do their jobs — whether in another city or in the middle of the night — increase employee productivity, reduce turnover and lower organizational costs.”
Over the past 18 months, while instituting a remote work model, our turnover rate at Insightly was the lowest in company history and an internal survey found happiness levels to be twice as high from the previous year. This in the midst of a major pandemic, social movement, forest fires and a disruptive election — all happening at the same time.
As long as your employees are available when your customers are in need and goals are consistently met, 9 to 5 no longer needs to be a thing.
On a larger, global scale, employers from companies around the world are coming to the same realization: You don’t need an office to be productive and employees are happier working from home.
The next logical step is, at the same time, a majorly disruptive one and a 180-degree shift toward how companies have operated for over 100 years — the transition from in-person headquarters to a remote, work-from-anywhere model. In line with this shift, we’ve foregone our 40,000-square-foot Soma office space and employees are able to work from anywhere in the United States while keeping the same salary.
There will no doubt be challenges, and there already have been. But with these challenges also arises immense opportunity. Here are a few battle-tested tips on how to maintain productivity while delivering flexibility with this new work model:
Reallocate overhead savings
Let employees choose where they live. Allowing this option will better their lives and make for happy, engaged employees. Overhead costs, especially in large cities such as San Francisco, are the largest operating expense for most companies. Take this large sum of money and invest in employee happiness. You don’t need thousands of square feet in office space to be successful.
That massive overhead cost you just got rid of? Use this toward more meaningful employee experiences that will enhance their lives.
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Why I make everyone in my company be the CEO for a day
Leaders become great not because of their power, but because of their ability to empower others.
It’s no secret that most tech companies tout their culture as “unique” or “open,” but when you take a closer look, it’s often merely surface level. Yes, you may be dog-friendly or offer unlimited beer on tap, but how are you helping your employees become the best versions of themselves? We’re at our best when our employees are at their best, so we do everything in our power to make that a reality.
We’re at our best when our employees are at their best, so we do everything in our power to make that a reality.
After successfully running Vincit in Finland and Switzerland, in 2016 we made the jump to the United States, setting up an office in California. Although we had moved over 5,000 miles to a new country, it was important that our two main KPIs remain the same: Employee happiness and customer satisfaction. We believe that happy employees make clients happy, and happy clients refer you to others. Therefore, it was essential that this positive and prosperous workplace environment followed us to the United States.
So beyond traditional benefits, like full medical coverage, 401k matching and standard office amenities, we tapped into our Finnish roots to build and provide our employees with an uninhibited, supportive workplace. We keep our company culture as transparent as possible and fully believe in the power of empowering our employees. We have no managers and no real role hierarchy. Employees do not have to go through an approval process on anything they are working on.
We encourage our employees to make a trip to Finland to visit our headquarters. Instead of “Lunch & Learn” meetings, we host “Fail & Learn” meetings where employees get to share something that didn’t work and what they learned from it. And once a month, we let an employee become the CEO for a day.
Unsurprisingly, the “CEO of the Day” program is one of our most popular initiatives. The program gives our employee the reins for 24 hours with an unlimited budget. The only requirement? The CEO must make one lasting decision that will help improve the working experience of Vincit employees. Whatever the CEO of the Day decides, the company sticks with. They can purchase something for the company, change a policy, update a tool we use … Really, anything that they come up with can be done.
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Remote raises $150M on a $1B+ valuation to manage payroll and more for organizations’ global workforces
For many of us, going to work these days no longer means going into a specific office like it used to; and today one of the startups that’s built a platform to help cater to that new, bigger world of employment — wherever talent might be — is announcing a major round of funding on the back of strong demand for its tools.
Remote, which provides tools to manage onboarding, payroll, benefits and other services for tech and other knowledge workers located in remote countries — be they contractors or full-time employees — has raised $150 million. Job van der Voort, the Dutch-based CEO and co-founder of New York-based Remote, confirmed in an interview that funding values Remote at over $1 billion.
Accel is leading this Series B, with participation also from previous investors Sequoia, Index Ventures, Two Sigma, General Catalyst and Day One Ventures.
The funding will be used in a couple of areas. First and foremost, it will go toward expanding its business to more markets. The startup has been built from the ground up in a fully integrated way, and in contrast to a number of others that it competes with in providing Employer of Record services, Remote fully owns all of its infrastructure. It now provides its HR services, as fully operational legal entities, for 50 countries (it has a target of growing that to 80 by the end of this year). The platform is also set to be enhanced with more tools around areas like benefits, equity incentive planning, visa and immigration support and employee relocation.
“We are doubling down on our approach,” van der Voort said. “We try to fully own the entire stack: entity, operations, experts in house, payroll, benefits and visa and immigration — all of the items that come up most often. We want to to build infrastructure products, foundational products because those have a higher level of quality and ultimately a lower price.”
In addition, Remote will be using the funding to continue building more tools and partnerships to integrate with other providers of services in what is a very fragmented human resources market. Two of these are being announced today to coincide with the funding news: Remote has launched a Global Employee API that HR platforms that focus on domestic payroll can integrate to provide their own international offering powered by Remote. HR platform Rippling (Parker Conrad’s latest act) is one of its first customers. And Remote is also getting cosier with other parts of the HR chain of services: applicant tracking system Greenhouse is now integrating with it to help with the onboarding process for new hires.
Indeed, $150 million at a $1 billion+ valuation is a very, very sizable Series B, even by today’s flush-market standards, but it comes after a bumper year for the company, and in particular since November last year when it raised a Series A of $35 million. In the last nine months, customer numbers have grown seven-fold, with users on the platform increasing 10 times. Most interestingly, perhaps, is that Remote’s revenues — its packages start at $149 per month but go up from there — have increased by a much bigger amount: 65x, the company said. That basically points to the fact that engagement from those users — how much they are leaning on Remote’s tech — has skyrocketed.
Although there are a lot of competitors in the same space as Remote — they include a number of more local players alongside a pretty big range of startups like Oyster (which announced $50 million in funding in June), Deel, which is now valued at $1.25 billion; Turing; Papaya Global (now also valued at over $1 billion); and many more — the opportunity they are collectively tackling is a massive one that, if anything, appears to be growing.
Hiring internationally has always been a costly, time-consuming and organizationally challenged endeavor, so much so that many companies have opted not to do it at all, or to reserve it for very unique cases. That paradigm has drastically shifted in recent years, however.
Even before COVID-19 hit, there was a shortage of talent, resulting in a competitive struggle for good people, in companies’ home markets, which encouraged companies to look further afield when hiring. Then, once looking further afield, those employers had to give consideration to employing those people remotely — that is, letting them work from afar — because the process of relocating them had also become more expensive and harder to work through.
Then COVID-19 happened, and everyone, including people working in a company’s HQ, started to work remotely, changing the goalposts yet again on what is expected by workers, and what organizations are willing to consider when bringing on a new person, or managing someone it already knows, just from a much farther distance.
While a lot of that has played out in the idea of relocating to different cities in the same country — Miami and Austin getting a big wave of Silicon Valley “expats” being two examples of that — it seems just a short leap to consider that now that sourcing and managing is taking on a much more international slant. A lot of new hires, as well as existing employees who are possibly not from the U.S. to begin with, or simply want to see another part of the world, are now also a part of the mix. That is where companies like Remote are coming in and lowering the barriers to entry by making it as easy to hire and manage a person abroad as it is in your own city.
“Remote is at the center of a profound shift in the way that companies hire,” said Miles Clements, a partner at Accel, in a statement. “Their new Global Employee API opens up access to Remote’s robust global employment infrastructure and knowledge map, and will help any HR provider expand internationally at a speed impossible before. Remote’s future vision as a financial services provider will consolidate complicated processes into one trusted platform, and we’re excited to partner with the global leader in the quickly emerging category of remote work.”
And it’s interesting to see it now partnering with the likes of Rippling. It was a no-brainer that as the latter company matured and grew, it would have to consider how to handle the international component. Using an API from Remote is an example of how the model that has played out in communications (led by companies like Twilio and Sinch) and fintech (hello, Stripe) also has an analogue in HR, with Remote taking the charge on that.
And to be clear, for now Remote has no plans to build a product that it would sell directly to individuals.
“Individuals are reaching out to us, saying, ‘I found this job and can you help me and make sure I get paid?’ That’s been interesting,” van der Voort said. “We thought about [building a product for them] but we have so much to do with employers first.” One thing that’s heartening in Remote’s approach is that it wouldn’t want to provide this service unless it could completely follow through on it, which in the case of an individual would mean “vetting every major employer,” he said, which is too big a task for it right now.
In the meantime, Remote itself has walked the walk when it comes to remote working. Originally co-founded by two European transplants to San Francisco, the pair had firsthand experience of the paradoxical pains and opportunities of being in an organization that uses remote workforces.
Van der Voort had been the VP of product for GitLab, which he scaled from five to 450 employees working remotely (it’s now a customer of Remote’s); and before co-founding Remote, CTO Marcelo Lebre had been VP of engineering for Unbabel — another startup focused on reducing international barriers, this time between how companies and global customers communicate.
Today, not only is the CEO based out of Amsterdam in The Netherlands, with the CTO in Lisbon, Portugal, but New York-based Remote itself has grown to 220 from 50 employees, and this wider group has also been working remotely across 47 countries since November 2020.
“The world is looking very different today,” van der Voort said. “The biggest change for us has been the size of the organization. We’ve gone from 50 to more than 200 employees, and I haven’t met any of them! We have tried to follow our values of bringing opportunity everywhere so we hire everywhere as we solve that for our customers, too.”
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Before an exit, founders must get their employment law ducks in a row
Successfully selling a business has much to do with timing. For many entrepreneurs, it’s the high-stakes end game where they cash out and reap the rewards of their efforts. At a certain point, when both buyers and sellers are working hard to close the deal, negotiations can move very quickly. If you’re the seller, this is not the time to discover unanticipated problems in your business.
Distressingly often, these problems are related to employment. Inattention to employment issues can have a significant impact on deals — from preventing closings and reducing the deal value to altering the deal terms or significantly limiting the pool of potential buyers.
Poor compliance, lack of policies or flawed practices mean potential liability exposure or expensive policy revisions and employee retraining — all of which can devalue your business.
Fortunately, such issues typically can be resolved well in advance with a little forethought and legal guidance. It’s important to get your employment ducks in a row long before you start planning your exit.
What follows is an overview of the three main categories of employment issues that can derail or delay a sale. For the most part, these assume an asset sale, but may vary in the case of a stock sale.
Compliance
By far the most significant problem is general employment law compliance. This means creating strong employment policies and practices that are documented, in place and operating long before you pursue a deal. The key area is wage and hour issues — timekeeping and payroll practices, worker classification issues (employee vs. independent contractor; exempt vs. non-exempt), meal and rest periods, PTO policies and payouts at termination.
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Worksome pulls $13M into its high skill freelancer talent platform
More money for the now very buzzy business of reshaping how people work: Worksome is announcing it recently closed a $13 million Series A funding round for its “freelance talent platform” — after racking up 10x growth in revenue since January 2020, just before the COVID-19 pandemic sparked a remote working boom.
The 2017 founded startup, which has a couple of ex-Googlers in its leadership team, has built a platform to connect freelancers looking for professional roles with employers needing tools to find and manage freelancer talent.
It says it’s seeing traction with large enterprise customers that have traditionally used Managed Service Providers (MSPs) to manage and pay external workforces — and views employment agency giants like Randstad, Adecco and Manpower as ripe targets for disruption.
“Most multinational enterprises manage flexible workers using legacy MSPs,” says CEO and co-founder Morten Petersen (one of the Xooglers). “These largely analogue businesses manage complex compliance and processes around hiring and managing freelance workforces with handheld processes and outdated technology that is not built for managing fluid workforces. Worksome tackles this industry head on with a better, faster and simpler solution to manage large freelancer and contractor workforces.”
Worksome focuses on helping medium/large companies — who are working with at least 20+ freelancers at a time — fill vacancies within teams rather than helping companies outsource projects, per Petersen, who suggests the latter is the focus for the majority of freelancer platforms.
“Worksome helps [companies] onboard people who will provide necessary skills and will be integral to longer-term business operations. It makes matches between companies and skilled freelancers, which the businesses go on to trust, form relationships with and come back to time and time again,” he goes on.
“When companies hire dozens or hundreds of freelancers at one time, processes can get very complicated,” he adds, arguing that on compliance and payments Worksome “takes on a much greater responsibility than other freelancing platforms to make big hires easier”.
The startup also says it’s concerned with looking out for (and looking after) its freelancer talent pool — saying it wants to create “a world of meaningful work” on its platform, and ensure freelancers are paid fairly and competitively. (And also that they are paid faster than they otherwise might be, given it takes care of their payroll so they don’t have to chase payments from employers.)
The business started life in Copenhagen — and its Series A has a distinctly Nordic flavor, with investment coming from the Danish business angel and investor on the local version of the Dragons’ Den TV program Løvens Hule; the former Minister for Higher Education and Science, Tommy Ahlers; and family home manufacturer Lind & Risør.
It had raised just under $6M prior to thus round, per Crunchbase, and also counts some (unnamed) Google executives among its earlier investors.
Freelancer platforms (and marketplaces) aren’t new, of course. There are also an increasing number of players in this space — buoyed by a new flush of VC dollars chasing the ‘future of work’, whatever hybrid home-office flexible shape that might take. So Worksome is by no means alone in offering tech tools to streamline the interface between freelancers and businesses.
A few others that spring to mind include Lystable (now Kalo), Malt, Fiverr — or, for techie job matching specifically, the likes of HackerRank — plus, on the blue collar work side, Jobandtalent. There’s also a growing number of startups focusing on helping freelancer teams specifically (e.g. Collective), so there’s a trend towards increasing specialism.
Worksome says it differentiates vs other players (legacy and startups) by combining services like tax compliance, background and ID checks and handling payroll and other admin with an AI powered platform that matches talent to projects.
Although it’s not the only startup offering to do the back-office admin/payroll piece, either, nor the only one using AI to match skilled professionals to projects. But it claims it’s going further than rival ‘freelancer-as-a-service’ platforms — saying it wants to “address the entire value chain” (aka: “everything from the hiring of freelance talent to onboarding and payment”).
Worksome has 550 active clients (i.e. employers in the market for freelancer talent) at this stage; and has accepted 30,000 freelancers into its marketplace so far.
Its current talent pool can take on work across 12 categories, and collectively offers more than 39,000 unique skills, per Petersen.
The biggest categories of freelancer talent on the platform are in Software and IT; Design and Creative Work; Finance and Management Consulting; plus “a long tail of niche skills” within engineering and pharmaceuticals.
While its largest customers are found in the creative industries, tech and IT, pharma and consumer goods. And its biggest markets are the U.K. and U.S.
“We are currently trailing at +20,000 yearly placements,” says Petersen, adding: “The average yearly spend per client is $300,000.”
Worksome says the Series A funding will go on stoking growth by investing in marketing. It also plans to spend on product dev and on building out its team globally (it also has offices in London and New York).
Over the past 12 months the startup doubled the size of its team to 50 — and wants to do so again within 12 months so it can ramp up its enterprise client base in the U.S., U.K. and euro-zone.
“Yes, there are a lot of freelancer platforms out there but a lot of these don’t appreciate that hiring is only the tip of the iceberg when it comes to reducing the friction in working with freelancers,” argues Petersen. “Of the time that goes into hiring, managing and paying freelancers, 75% is currently spent on admin such as timesheet approvals, invoicing and compliance checks, leaving only a tiny fraction of time to actually finding talent.”
Worksome woos employers with a “one-click-hire” offer — touting its ability to find and hire freelancers “within seconds”.
If hiring a stranger in seconds sounds ill-advised, Worksome greases this external employment transaction by taking care of vetting the freelancers itself (including carrying out background checks; and using proprietary technology to asses freelancers’ skills and suitability for its marketplace).
“We have a two-step vetting process to ensure that we only allow the best freelance talent onto the Worksome platform,” Petersen tells TechCrunch. “For step one, an inhouse-built robot assesses our freelancer applicants. It analyses their skillset, social media profiles, profile completeness and hourly or daily rate, as well as their CV and work history, to decide whether each person is a good fit for Worksome.
“For step two, our team of talent specialists manually review and decline or approve the freelancers that pass through step one with a score of 85% or more. We have just approved our 30,000th freelancer and will be able to both scale and improve our vetting procedure as we grow.”
A majority of freelancer applicants fail Worksome’s proprietary vetting processes. This is clear because it says it has received 80,000 applicants so far — but only approved 30,000.
That raises interesting questions about how it’s making decisions on who is (and isn’t) an ‘appropriate fit’ for its talent marketplace.
It says its candidate assessing “robot” looks at “whether freelancers can demonstrate the skillset, matching work history, industry experience and profile depth” deemed necessary to meet its quality criteria — giving the example that it would not accept a freelancer who says they can lead complex IT infrastructure projects if they do not have evidence of relevant work, education and skills.
On the AI freelancer-to-project matching side, Worksome says its technology aims to match freelancers “who have the highest likelihood of completing a job with high satisfaction, based on their work-history, and performance and skills used on previous jobs”.
“This creates a feedback loop that… ensure that both clients and freelancers are matched with great people and great work,” is its circular suggestion when we ask about this.
But it also emphasizes that its AI is not making hiring decisions on its own — and is only ever supporting humans in making a choice. (An interesting caveat since existing EU data protection rules, under Article 22 of the GDPR, provide for a right for individuals to object to automated decision making if significant decisions are being taken without meaningful human interaction.)
Using automation technologies (like AI) to make assessments that determine whether a person gains access to employment opportunities or doesn’t can certainly risk scaled discrimination. So the devil really is in the detail of how these algorithmic assessments are done.
That’s why such uses of technology are set to face close regulatory scrutiny in the European Union — under incoming rules on ‘high risk’ users of artificial intelligence — including the use of AI to match candidates to jobs.
The EU’s current legislative proposals in this area specifically categorize “employment, workers management and access to self-employment” as a high risk use of AI, meaning applications like Worksome are likely to face some of the highest levels of regulatory supervision in the future.
Nonetheless, Worksome is bullish when we ask about the risks associated with using AI as an intermediary for employment opportunities.
“We utilise fairly advanced matching algorithms to very effectively shortlist candidates for a role based solely on objective criteria, rinsed from human bias,” claims Petersen. “Our algorithms don’t take into account gender, ethnicity, name of educational institutions or other aspects that are usually connected to human bias.”
“AI has immense potential in solving major industry challenges such as recruitment bias, low worker mobility and low access to digital skills among small to medium sized businesses. We are firm believers that technology should be utilized to remove human bias’ from any hiring process,” he goes on, adding: “Our tech was built to this very purpose from the beginning, and the new proposed legislation has the potential to serve as a validator for the hard work we’ve put into this.
“The obvious potential downside would be if new legislation would limit innovation by making it harder for startups to experiment with new technologies. As always, legislation like this will impact the Davids more than the Goliaths, even though the intentions may have been the opposite.”
Zooming back out to consider the pandemic-fuelled remote working boom, Worksome confirms that most of the projects for which it supplied freelancers last year were conducted remotely.
“We are currently seeing a slow shift back towards a combination of remote and onsite work and expect this combination to stick amongst most of our clients,” Petersen goes on. “Whenever we are in uncertain economic times, we see a rise in the number of freelancers that companies are using. However, this trend is dwarfed by a much larger overall trend towards flexible work, which drives the real shift in the market. This shift has been accelerated by COVID-19 but has been underway for many years.
“While remote work has unlocked an enormous potential for accessing talent everywhere, 70% of the executives expect to use more temporary workers and contractors onsite than they did before COVID-19, according to a recent McKinsey study. This shows that businesses really value the flexibility in using an on-demand workforce of highly skilled specialists that can interact directly with their own teams.”
Asked whether it’s expecting growth in freelancing to sustain even after we (hopefully) move beyond the pandemic — including if there’s a return to physical offices — Petersen suggests the underlying trend is for businesses to need increased flexibility, regardless of the exact blend of full-time and freelancer staff. So platforms like Worksome are confidently poised to keep growing.
“When you ask business leaders, 90% believe that shifting their talent model to a blend of full-time and freelancers can give a future competitive advantage (Source: BCG),” he says. “We see two major trends driving this sentiment; access to talent, and building an agile and flexible organization. This has become all the more true during the pandemic — a high degree of flexibility is allowing organisations to better navigate both the initial phase of the pandemic as well the current pick up of business activity.
“With the amount of change that we’re currently seeing in the world, and with businesses are constantly re-inventing themselves, the access to highly skilled and flexible talent is absolutely essential — now, in the next 5 years, and beyond.”
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Enter new markets and embrace a distributed workforce to grow during a pandemic
Many companies will not see the uncertainty of a global pandemic as the perfect moment to go international, but for others (particularly in healthcare, online communications, and workplace mobility) the market is stronger than ever and companies are having to respond quickly internationally to both service existing clients and take advantage of the growth in demand.
We and our team at Taylor Wessing advise 50 to 75 venture-backed North American companies each year on setting up in Europe or Asia. We’ve helped companies such as TaskRabbit, Lime, Glossier, InVision and many others translate their domestic success to new jurisdictions and cultures and to thrive as global businesses.
This is a practical guide to international expansion with the challenges of the current time in mind. It’s a quick-read providing some practical tips and sharing best practices from peer companies to help you come out of the pandemic with a strong international presence. A great deal of this advice is evergreen and will serve you well whatever the circumstances may be.
In particular, we’ll cover the rise (and risks) of distributed workforces — a way for CEOs to hire the best talent anywhere in the world. This has taken on new significance with the boom in remote working as one of several options for CEOs looking for strategic growth during and after COVID.
Is this the right time to expand overseas?
Ten years ago, the timing question was much simpler. Founders would first of all focus on developing a product and winning over their domestic market, funded through their Series A and B rounds, and then go on to raise their Series C round, which investors would expect to be used to push into new markets.
Since then, with the age of the smartphone in full swing and international direct ordering ubiquitous, opportunities to sell into new markets appeared far earlier in a company’s growth and there is no longer a canned strategy for timing your international expansion.
The current circumstances have exaggerated this trend. There are many challenges in traditional sectors, but also many new market opportunities quickly appearing in healthcare and other technology sectors with founders wanting to move quickly into new markets.
Although it may be tempting to just get a few sales people on the ground to go for it, we would still recommend laying some groundwork and making some key decisions before diving in. For example: ensuring management can give sufficient time and attention to the new market; tweaking your product to comply with local regulations; reworking your sales approach.
If you are early-stage, tread carefully. Our belief is that the Series B round is still the earliest a founder or board should consider international expansion.
If you are early-stage, tread carefully. Our belief is that the Series B round is still the earliest a founder or board should consider international expansion. The companies we’ve worked with who have moved earlier than the B round will generally end up realizing it’s too early. They’ll end up pressing pause, or making a full strategic exit, tail between legs.
International expansion is a matter of focus, as well as financial resources. Once you’re selling into a new market, everyone in the business needs to be thinking internationally, including the CEO, CFO, general counsel, the board, engineers and staff. It can stretch everyone before there are the necessary resources in place to cope.
Decision made: How do you get going quickly?
Even in the best of times our advice would be to not experiment or push the boundaries when it comes to your international strategy, do that elsewhere in your business. You should follow the path most travelled at this stage. This is especially true in the current climate. If you’re thinking of doing something new, something your peers haven’t done before, we should have a conversation first.
Whichever market you’ve chosen, there are some universal first steps (although they might vary slightly between jurisdictions). For example:
- If you have a permanent establishment for tax purposes (i.e., the local tax authorities consider you established enough to be paying income tax and corporation tax), work on the basis that you’ll need to incorporate a company or register a local branch.
- Consider flexible options when it comes to taking on people (more on this below). Remember that in all cases local employment contracts will be needed (subject to the use of PEOs – see below).
- Perhaps most importantly, local agreements transferring IP ownership will be needed (see next chapter).
- There will also be some local filings (e.g., tax, corporate, payroll) where you will need a local service provider such as an accountant and payroll provider.
Common international expansion traps … and how to avoid them
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With $18M in new funding, Braintrust says it’s creating a fairer model for freelancers
Braintrust, a network for freelance technical and design talent that launched over the summer, is announcing that it has raised $18 million in new funding.
Co-founder and CEO Adam Jackson has written for TechCrunch about how tech companies need to treat independent contractors with more empathy. He told me via email that the San Francisco-based startup is making that idea a reality by offering a very different approach than existing marketplaces for freelance work.
For one thing, Braintrust only charges the companies doing the hiring — freelancers won’t have to pay to join or to bid on a project, and Braintrust won’t charge a fee on their project payments. In addition, the startup is using a cryptocurrency token that it calls Btrust to reward users who build the network, for example by inviting new customers or vetting freelancers. Apparently, the token will give users a stake in how the network evolves in the future.
“Just imagine if Uber had given all of its drivers some ownership in the company what a different company it would be today,” Jackson said. “Braintrust will be 100% user-owned. Everyone who participates on the platform has skin in the game.”
And for companies, Braintrust is supposed to allow them to tap freelancers for work that they’d normally do in-house. The startup’s clients already include Nestlé, Pacific Life, Deloitte, Porsche, Blue Cross Blue Shield and TaskRabbit.
According to Jackson, most of the talent on the platform consists of career freelancers, but with many people losing their jobs during the COVID-19 pandemic, “we’ve seen an influx of talent coming looking to join the ranks of the freelancers.”
He added that the startup already became profitable after raising its $6 million seed round, so the new funding will allow it to build the core team and also bring in more work.
“We exist to help companies accelerate their product roadmaps and innovation, and this injection of funding will help us do just that,” Jackson said.
The new funding was led by ACME and Blockchange, with participation from new investors Pantera, Multicoin and Variant.
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Tech must radically rethink how it treats independent contractors
Adam Jackson is the CEO of Braintrust, the first user-controlled talent network that connects organizations with world-class tech talent. He also co-founded telemedicine company Doctor On Demand and blockchain-focused digital asset management company Cambrian Asset Management.
Despite a surging stock market and many major tech players having record quarters, we’re still seeing layoffs throughout tech and the rest of corporate America. Salesforce recorded a huge quarter, passing $5 billion in revenue, only to lay off around 1000 people. LinkedIn is laying off 960 people one day after reporting a 10% increase in revenue.
These layoffs may seem like a contraction in size for these huge enterprises, but it’s actually the beginning of something I call The Great Unbundling of Corporate America. They still need to grow, they still need to innovate, they still need to get work done and they’re not simply canceling projects and giving up on contracts.
Just as COVID-19 has accelerated the move to remote work, our current crisis has accelerated the trend toward hiring independent contractors. Back in 2019 a New York Times report found that Google had a shadow workforce of 121,000 temporary workers and contractors, overshadowing their 102,000 full-timers. ZipRecruiter reported in 2018 that tech, along with its record employment growth, was showing an increasing share of listings for independent contractors.
A study from the Bureau of Labor Statistics found that between 6.9% and 9.6% of all workers are now independent contractors, and according to Upwork, that may be as high as 35%. Mark my words — companies are using this time as an opportunity to swing the pendulum toward independent contractors and trimming the fat, justifying it with a vague gesture toward “an unprecedented time.”
That’s why, in my opinion, you’re seeing the NASDAQ hitting record highs despite everyone’s turmoil — depressingly, investors can see that large companies are tightening up and cleaning up waste, while finding an affordable workforce at will. As they have unbundled themselves from our physical offices, large enterprises are going to unbundle themselves from having to have a set number of employees.
When Square allowed its entire workforce to work remotely permanently. It wasn’t just because they wanted them to feel more creative and productive, but was likely a move away from having quite as much expensive, needless office space.
Similarly, if there is work that a full-time employee does that could be done by a flexible, independent contractor, why not make that change too? And it’ll be a lot easier to make without as many people at the office.
The argument I’m making is not anti-contractor, though.
I can’t think of any point in history where it’s been better to create a freelance business — the startup costs are significantly lower, and as companies move toward remote work, you can theoretically take business nationally (or internationally) like never before. Companies’ moves toward replacing W-2 workers with contractors is an opportunity for people to create their own miniature freelance empires, unbundling themselves from corporate America’s required hours, and potentially creating a way to weather future storms by taking away any single company’s leverage on their income.
The rush to remote work is also likely to push more workers into the freelance economy too. By having to create a remote office, with a remote presence in meetings and having to manage and organize our days, the average worker has all but adjusted to the life of a freelancer.
Where some might have gone to an office and had things simply happen to them, the remote world requires an attention to your calendar and active outreach to colleagues that, well, models how one might run a freelance business. Those with core skillsets that can be marketed and sold to multiple clients should be thinking about whether being a wage slave is necessary anymore, and with good reason.
That said — corporate America, and especially tech, has to treat this essential workforce with a great deal more empathy and respect than they have thus far.
Uber and Lyft were ordered to treat drivers as employees in part due to the fact that they never treated their contractors like parts of the company. Other than the obvious lack of benefits (paid time off, health insurance, etc.), Uber, like many large enterprises, treats contractors as disposable rather than flexible, despite them being the literal driving force of the company. When Uber went public, they gave a nominal bonus for drivers that had completed 2500 to 40,000 trips, with a chance to buy up to $10,000 of stock — at the IPO price. These drivers, that had been the very reason that many people became millionaires and billionaires when Uber went public, were given the chance to maybe make money, if they sold the stock quickly enough.
It’s an abject lesson on how to not build loyalty with independent contractors. It’s also a lesson on what the next big company that wants to build themselves off the back of the 1099’er should do.
What I’m suggesting is a radical rethinking of freelance contracting. I want you to see independent contractors as a different kind of worker, not as a way of skirting getting a full-time employee. A freelancer, by definition, is someone that you don’t monopolize, and someone that you should actively give agency and, indeed, part of the network you’re building. One of the issues of corporate America’s approach to freelance work is an us-versus-them approach to employment — you’re either part of us or you’re simply a thing we pick up and put down. What I’m suggesting is treating your freelancers as an essential part of your strategy, and compensating them as such. Freelancers should own equity and should have skin in the game — they may be working with you on a number of projects and take literal ownership of vast successes throughout your history.
Contracted work has only become mercenary through the treatment of the freelance worker. Where tech has succeeded in creating hundreds of thousands of independent contractor positions, it also has to lead the way in reimagining how we may treat them and reward them for their work. And corporate America needs to take a step beyond simply seeing them as a cheaper, easier way to do business. They’re so much more.
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Why I flip-flopped on opposing remote work
David Cancel, a five-time entrepreneur and author of the book “Conversational Marketing,” is CEO and founder of Drift.
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Most people would agree that a chief revenue officer is a pretty significant hire, but I have yet to meet mine in person. Right now, our only face-to-face interaction is over video. In fact, that’s how our relationship began — like many business leaders during this pandemic, I had to hire Todd through a series of video calls.
The pandemic has caused me to question and reevaluate many of my own assumptions. This not only led me to hire our CRO remotely, but it is ultimately why I also decided to allow employees to work from home until 2021.
While it’s tempting to call this a pivot, those who have worked with me would probably describe it more accurately as a flip-flop. I used to believe that you could build an in-person culture or a remote work culture, but that a hybrid of the two was destined to fail.
The realities of COVID-19 have not just changed my outlook, but transformed the way I think about how work should get done —and how leaders need to show up for their team, even if they can’t “show up” in any physical sense.
The remote work debate changed in an instant
Before the pandemic, the debate over remote work revolved around its perceived impact on productivity, collaboration, employee engagement and culture.
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Relativity Space’s focus on 3D printing and cloud-based software helps it weather the COVID-19 storm
Just like in almost every other industry, there’s been a rash of layoffs among newer space startups and companies amid the novel coronavirus crisis. But Relativity Space has managed to avoid layoffs — and is even hiring, despite the global pandemic. Relativity CEO and founder Tim Ellis cites the company’s focus on large-scale 3D printing and its adoption of cloud-based tools and technologies as big reasons why his startup hasn’t felt the pinch.
Because Relativity’s forthcoming launch vehicle is almost entirely made up of 3D-printed parts, from the engines to the fuselage and everything in between, the company has been able to continue producing its prototypes essentially uninterrupted. Relativity has been classified an essential business, as have most companies operating in anything related to aerospace or defense, but Ellis said that they took steps very early to address the potential threat of COVID-19 and ensure the health and safety of their staff. As early as March 9, when the disease was really first starting to show up in the U.S. and before any formal restrictions or shelter-in-place orders were in effect, Relativity was recommending that employees work from home where possible.
“We’re able to do that, partially because with our automated printing technology we were able to have very, very few people in the factory and still keep printers running,” Ellis said in an interview. “We actually even have just one person now running several printers that are still actually printing — it’s literally a single person operating, while a lot of the company has been able to make progress working from home for the last couple of weeks.”
Being able to run an entire production factory floor with just one person on-site is a tremendous competitive advantage in the current situation, and a way to ensure you’re also respecting employee health and safety. Ellis added that the company has already been operating between multiple locations, including teams at Cape Canaveral, Florida, as well as at Stennis Space Center in Mississippi and at its headquarters in LA. Relativity also had a further distributed workforce with a few employees working remotely from locations across the U.S, and it focused early on ensuring that its design and development processes could work without requiring everyone to be centrally based.
“We’ve developed our own custom software tools to just streamline those workflows, that really helped,” Ellis said. “Also, just being more of a cloud-enabled company, while still complying with ITAR and security protocols, has been really, really advantageous as well.”
In addition to their focus on in-house software and cloud-based tools, Ellis credits the timing of their most recent round — a $140 million investment closed last October — as a reason they’re well-situated for enduring the COVID-19 crisis. He says that Relativity not only managed to avoid any layoffs, while sending out new offers, but they’re also still paying all employees, including hourly workers, their full regular wage. All of this stems from a business model that in retrospect, seems prescient, but that Ellis says actually just has significant advantages in today’s global business climate by virtue of chance. Still, he does believe that some of Relativity’s resilience thus far signals some of the biggest lasting changes that will result from the coronavirus pandemic.
“What it’s really going to change […] is the approach to global supply chain,” he said. “I think there’s going to be a big push to have more things made in America, and then less dependence on heavy globalization across supply chain. That’s one you thing we’ve always had with 3D printing — not only is it an automated technology, where we can have very few operators still making progress even during times like like this and printing some of the first-stage structures of our rocket — but on the supply chain side, just having simpler supply chains with fewer vendors and different types of manufacturing processes means it’s much less likely that we’ll see very significant supplier and supply chain interruptions.”
Meanwhile, while Ellis says that ultimately they can’t predict how the coronavirus crisis will impact their overall schedule in terms of planned launch activities, which includes flying their first 3D-printed vehicle in 2021, they anticipate being able to make plenty of progress through remote work and a production line that can easily comply with social isolation guidelines. Partner facility shutdowns, including the rocket engine test stand at Stennis, will definitely have an impact, but Relativity’s resilience could prove a model for manufacturing businesses of all stripes to emulate once this moment has passed.
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