[HN Gopher] No meetings, no deadlines, no full-time employees
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No meetings, no deadlines, no full-time employees
Author : sahillavingia
Score : 804 points
Date : 2021-01-07 16:41 UTC (6 hours ago)
(HTM) web link (sahillavingia.com)
(TXT) w3m dump (sahillavingia.com)
| philmcp wrote:
| In years to come we will look down on the 5 day working week in
| the same way we currently do with 15hr factory shifts during the
| industrial revolution.
|
| It absolutely blows my mind that 99% of office roles are still 5
| days / week, Monday to Friday - why is there basically no
| variation on this model? I'd be more than happy to work a job for
| 80% salary for 4 days per week...
|
| So much so, I'm about to launch a website listing remote software
| jobs with a 4 day work week:
|
| https://www.28hrworkweek.com/
| dcolkitt wrote:
| The bigger issue to me is that there's no diversification of
| risk. If your company goes under, you lose 100% of your income
| all at once. From that perspective, it'd be a lot more rational
| to work say ten jobs at a single time.
|
| You're never at serious risk of losing more than 30% of your
| paycheck in any short period. You could even get smart and
| balance your portfolio of jobs between pro and counter-cyclical
| industries. Plus, it's a good way to let people gracefully
| transition between careers. Want to move into machine learning?
| Take a low-paying junior ML internship for one of your 1/10
| jobs to build experience.
|
| It'd also be good from a societal perspective, since jobs at
| small, fast-growing, but high-risk companies would become
| comparatively more attractive. It'd be harder to sustain toxic
| workplace environments, since any given employee would have
| plenty of other options. Managers would be less hesitant to
| shutdown money losing divisions or fire underperfomers, since
| you're not leaving the employee destitute.
| TeaDrunk wrote:
| We'd need to radically change the system with which education
| happens to make this real, otherwise teachers and the
| infrastructure of teachers (administrators, social workers,
| counselors, janitors, IT people, etc) would still need that
| workweek + parents who have to follow that workweek.
| philmcp wrote:
| It doesn't mean that some companies shouldn't exist to fill
| the demand from people who want 4 day work weeks though.
| Not everyone has kids, plus, not everyone in the company
| needs to be employed on the same terms imo.
|
| Also, given how difficult it is to recruit developers,
| offering roles on a 4 day week will ease this process as
| it's a "USP" that few other companies offer.
| kaftoy wrote:
| For your example's sake, if the work for one job is just a
| tenth, then it means that for a 5 men job, a manager would
| need to hire 50 people. The manager would be overwhelmed and
| add cost to the company by asking for a colleague. It's not
| easy to manage 50 people. But maybe the manager wants to
| diversify himself, so instead of 2 manager for 50 people,
| you'll have... 20 managers for 50 people. You need a
| managers' manager. Where does it end? :)
| Grimm1 wrote:
| I think they're implying that the majority of current
| working time isn't actually work, that those jobs could be
| done with 1/10th the current man hours and still be just as
| productive.
|
| In that world you don't need to hire anyone else because
| all you've done is cut back all the bs idling time that we
| all know exists in many jobs while keeping output the same.
|
| FWIW I'm not sure I agree on the 1/10th but like 1/3rd or
| 1/2 absolutely from my position.
| philmcp wrote:
| Maybe it's just me, but I find it difficult working on more
| than 2 projects at one time. Lots of wasted time trying to
| remember what I was working on / how my code works.
| conductr wrote:
| Most want/need the full check. And the company wants full
| "value"/40 hours. So what you end up seeing more often is the
| 10x4 model or every other Friday off. It's just a reallocation
| of time.
| exoque wrote:
| I worked 80% for one and a half years on a decent salary. In
| the end I decided it wasn't worth the cost.
| namdnay wrote:
| Yeah the trap with 80% is it often ends up being 100%
| compressed to 4 days :(
| philmcp wrote:
| Fair enough, it's not for everyone. After 10 years of being a
| developer in a country which is relatively cheap to live in,
| however, I'd be more than happy to take the financial hit.
| jfengel wrote:
| Some of it is a quirk of the American health care system. Your
| health care costs the same regardless of your work hours, and
| it's a significant fraction of compensation. If you were
| working 80% as much, they would probably only be able to pay
| 70% of your salary.
|
| (Assuming you were linearly productive, which it's not, but
| it's the same assumption you were making and is good enough for
| this illustration.)
|
| There are other fixed overheads, like your manager, human
| resources, the office itself, and even the cost of hiring you
| in the first place. It's possible that to make all things
| equal, they might have to change your salary to as much at 60%.
|
| Of course all things are never equal, so these numbers have
| really wide error bars. And after all that, you might well
| decide that 60% salary for a 32 hour week would still be a good
| deal. I know I'd consider it. But it's important to note that
| it's going to be rare to find a job that will pay you 80% as
| much for 80% of the work.
| alfiedotwtf wrote:
| > Some of it is a quirk of the American health care system.
|
| Probably more to do with Britain's Factory Act of 1833 and
| follow up Act of 1844.
| brabel wrote:
| No country is in a vacuum... popular movements spread
| across borders and as the population of one country
| achieves something, their neighbours start demanding the
| same and so on... according to Wikipedia, the huge decline
| in working hours seen in the 20th century was mostly due to
| unionisation and legislation in response to popular demand.
|
| Today, the US and the UK seem to be pretty typical compared
| to other countries, which is to be expected:
|
| https://en.wikipedia.org/wiki/Working_time#/media/File:Heur
| e...
| alfiedotwtf wrote:
| Good point on unionisation.
|
| In all honesty, I would have though reduction of hours
| was due to automation and the advent of machinery, but I
| found this quote interesting...
|
| When a labourer," said Mr. Ashworth, a cotton magnate, to
| Professor Nassau W. Senior, "lays down his spade, he
| renders useless, for that period, a capital worth
| eighteen-pence. When one of our people leaves the mill,
| he renders useless a capital that has cost PS100,000."
| Only fancy! making "useless" for a single moment, a
| capital that has cost PS100,000! It is, in truth,
| monstrous, that a single one of our people should ever
| leave the factory! The increased use of machinery, as
| Senior after the instruction he received from Ashworth
| clearly perceives, makes a constantly increasing
| lengthening of the working-day "desirable."
| kaftoy wrote:
| And more importantly above all, in my opinion, is the profit.
| A portion of the revenue generate by an employee becomes
| profit. Lower the revenue (since lower hours) means lower net
| profit. Giving up net profit is not somthing a business owner
| thinks about lightly.
| philmcp wrote:
| But if you pay lower salaries, you can hire more people.
|
| There is very little difference (imo) between 3 employees @
| 40hrs per week vs 4 employees @ 30hrs per week. There will
| be more administration and onboarding admittedly, but this
| should be balanced by more productive employees (i.e. less
| burnout)
| tw04 wrote:
| >If you were working 80% as much, they would probably only be
| able to pay 70% of your salary.
|
| ...why? Unless there's an implication that they'd need to
| hire more people, why would they need to pay you less? If
| you're generating the same amount of revenue, just working
| fewer hours, their fixed profit should be able to cover your
| fixed healthcare whether you work 80% of the time or 10% of
| the time. As long as they aren't incurring additional expense
| by hiring multiple people to do the same job to facilitate
| fewer hours.
|
| A shorter work week obviously can't work for all businesses,
| but there are plenty that have tried it and found that
| workers spend more time working and less time socializing
| with a shorter work week (which would seem to be a win for
| everyone).
| s1artibartfast wrote:
| >Unless there's an implication that they'd need to hire
| more people
|
| I think you hit the nail on the head. IF the company needs
| a someone M-F for 40 hours of Bug-fixed/widgets/ect, they
| will have to hire to fill the gap.
|
| If the last 20% of the worker's time is truly non-
| productive, then the company is already over paying and the
| worker is wasting their time.
| thebean11 wrote:
| > There are other fixed overheads, like your manager, human
| resources
|
| Are these fixed costs, or would these employees also be
| working 80% as much? I think only the healthcare / office
| space for these people are fixed costs, but that would be
| factored in calculating their new salary.
| shafyy wrote:
| In my experience, in Europe (at least in Switzerland and
| Germany) it's much more common for people to work 80% than it
| is in the US.
| philmcp wrote:
| Ye, I've also heard that in the Netherlands there are laws
| which say a company _must_ accept an employees request to
| work part time if they have been there for 1+ years.
| ativzzz wrote:
| Curious how being laid back in regards to work opens up
| opportunity from countries such as China that have some
| companies working 996 schedules (9-am - 9pm, 6 days a week)
| to overtake and make obsolete European global companies. I
| guess the only way EU can compete is protectionism, no?
| shafyy wrote:
| Your underlying assumption is that companies where
| employees work more hours are more successful on the market
| place. I would say this is a deeply flawed assumption.
| ativzzz wrote:
| If two equally capable entities are competing, the one
| who puts in more time will almost always win. The Chinese
| may be lacking the (social and physical) infrastructure
| that the Europeans have a head start on for productivity,
| but they are catching up or have already caught up.
|
| This probably applies less to big conglomerates who exist
| and will continue existing regardless of what happens
| (honestly most of their employees can just not show up
| and they will be fine), but more to technical innovation.
| lynguist wrote:
| No.
|
| I can guarantee you that in general in software
| engineering, you will produce the same result, whether
| you work 30 or 40 or 60 hr a week. The productive hours
| will be the same as you just have so much focused hours
| inside of you.
| exoque wrote:
| For the Swiss it doesn't matter what China does, anywhere
| else is cheaper anyway.
| pc86 wrote:
| A B2B business has two choices if they want to institute a
| 4-day week. They can be closed 20% of the week, when their
| competition is likely open, or they can be open 5 days and
| spread 4 days of work out among their staff. So now if your
| coworker takes off Tuesdays, and you take off Wednesdays, you
| better not have a question for him on Tuesday morning.
|
| And isn't 28 hours 3.5 days?
| philmcp wrote:
| I think if managed correctly the second option is more than
| achievable for a software development team. I agree it
| doesn't work for all industries / jobs (e.g. support staff
| etc), but for the majority of technical positions, I think
| the gain in productivity and saving in salary will more than
| make up for these inconveniences. I also think it will make
| the recruitment of developers easier as you'll be offering a
| benefit rarely seen.
|
| And ye, a few people have mentioned the point about 28hrs -
| I'm going to rebrand it as "4 day week".
| spaetzleesser wrote:
| Totally agree. Due to COVID most of my company worked only 4
| days per week last year. The improvement in quality of life was
| amazing and productivity didn't drop noticeably.
|
| There was a time when 6 days per week were normal. People
| thought the world would go under if people worked only 5 days
| but things were ok. The same will happen with 4 day weeks. Once
| people get used to it it will be hard to imagine working more.
| philmcp wrote:
| Exactly - the productivity boost employees gain from not
| being burned out, combined with a slightly lower wage bill. I
| see it as a win / win for both parties tbh.
| namdnay wrote:
| > why is there basically no variation on this model? I'd be
| more than happy to work a job for 80% salary for 4 days per
| week
|
| So part time? This is pretty normal in nearly every company
| I've worked in, lots of people take it to spend more time with
| young kids
| philmcp wrote:
| For all the companies I've worked at, the developers are all
| full-time so I envy your industry / location if part-time is
| common.
|
| More generally though, I feel employees almost need an
| "excuse" to work part time (i.e. some reason such as
| childcare). I wish for a time when a significant % of
| developer jobs are _advertised_ as near-full time and that I
| 'm not stereotyped as lazy for applying to them. There's more
| to life than reviewing pull requests...
| andruby wrote:
| Some of my most productive colleagues work 4/5th. They are
| often more productive than fulltimers.
|
| In most European countries this is normal and not frowned
| upon. Some countries even protect this option for employees
| by law.
| olah_1 wrote:
| > There is another downside to this system: people have to track
| their hours. Some people solve this by billing 20 hours a week,
| even though they may work a bit more or a bit less. Others track
| it diligently, in 15-minute increments, and send a detailed
| invoice every week.
|
| I cannot stand tracking hours. No thanks.
| orasis wrote:
| These examples are important for the HN community.
|
| I also run a successful zero FTE company and I wouldn't trade it
| for anything.
| simpixelated wrote:
| I work at a similar company (less than 10 employees, no
| deadlines, (almost) no meetings), but unlike Gumroad we actually
| have health insurance, 401K with matching, donation matching,
| etc. So it is possible to to have "freedom" without laying
| everyone off and removing all benefits. You can read more about
| it here: https://simpixelated.com/two-year-work-retrospective
| amoorthy wrote:
| Sahil is such a good writer. So vulnerable and insightful. I'm
| envious :-)
|
| His insights on how to live and work better and making me think
| if my little startup can follow some of these ideas.
| philipkiely wrote:
| I work at Gumroad, mentioned in this article.
|
| Sometimes, I read things by CEOs about how a company works on the
| inside and I wonder if it really looks like that, or if it is a
| view from the top that doesn't reflect what it's really like.
|
| This article, with its discussions of the upsides and downsides,
| is accurate to my experience and my understanding of other
| people's experiences. For many people, Gumroad wouldn't be a
| great place to work, but for those of us who want to work like
| this, it is exactly what we need. Very glad to be working at
| Gumroad and working in the ways the article describes.
|
| Edit: Following up with a few FAQs from posts in the thread:
|
| * Health Insurance: I'm personally lucky enough to still be
| covered on my dad's health insurance until I turn 26, thanks to
| the ACA, though for supplementary (vision, dental) I make more
| than enough to afford proper health insurance on the open market.
| Everyone at Gumroad is paid very well and should be able to
| afford the same.
|
| * Regarding overtime, benefits, etc: we make very competitive
| rates as contractors. I sincerely appreciate your concern,
| though.
|
| * On the shift from full-time employees to contractors, the
| company declined and was rebuilt over a period of five years. I'm
| a relatively recent addition, so I only know Gumroad as it is
| now, I cannot comment on how it was. All I can say is that it's
| not like Sahil went out and fired everyone and then the next day
| it was a bunch of contractors.
| [deleted]
| dkdk8283 wrote:
| I'd love something like this: I loathe the bullshit factory
| process has become.
| ska wrote:
| Process is one of those things you have whether you think
| about it or not. It's up to you collectively to decide if it
| is BS or not, too heavy, too light, etc. I'm not suggesting
| everyone has the influence to change process much at the
| place they work, but they idea that there is a single "thing"
| called process and some places have it and some don't is just
| dangerously misleading.
|
| It is true that process tends to naturally scale with org
| size and longevity because communication becomes more
| complicated with this scaling - but that only gives you a bit
| of a lower bound (i.e. if you go below this, you start
| shooting yourselves in the feet)
| tharne wrote:
| This is 100% spot on. There's always a process to one's
| work. It's just a matter of whether you want to be
| intentional about it or not.
| wussboy wrote:
| https://en.wikipedia.org/wiki/The_Tyranny_of_Structurelessn
| e...
| lscotte wrote:
| Indeed, I agree with all this.
|
| The trick is finding a balance, as a friend once told me
| the sweet spot is "as little process as possible, as much
| process as necessary".
| eldavido wrote:
| This is a really thoughtful comment.
|
| "Process weight" is a good concept I wished more people
| understand. Building released-to-web software without
| hardware, big teams, long-term API support, etc. should
| really have almost no process, except for maybe high-level
| prioritization of features/functional areas (which a small-
| company CEO or PM can do). Reflecting on my own experience,
| it's the micro-management of most development processes
| that kills me -- 45 minute stand-ups where I'm arguing over
| whether something will take 2 or 4 hours. I honestly don't
| know and the powers that be just can't accept that. "How do
| you not know how long doing that will take!?!"
|
| I think most teams would be capable of this, it's just that
| the people signing the checks get really, really
| uncomfortable with the apparent lack of accountability.
| beaconstudios wrote:
| it's the tension between the bean-counter side of the
| company (finance, top level management, marketing vis-a-
| vis timelines) versus the creative side of the company
| (design & development, R&D). One side requires rigid
| predictability to perform optimally and the other side
| flexibility and ambiguity. Where the line is drawn and
| expectations are set is a function of company culture,
| hence why bigger companies/enterprises tend to come down
| heavy on requiring estimates.
|
| (I don't mean bean-counter pejoratively; the world needs
| order and predictability just as much as it needs
| creativity).
| rokalakt wrote:
| Spoken like a true worker. Please your boss now with a new
| policy to follow. Obey a few rules to show how you should
| be promoted and maybe approved time off this Friday.
| tartoran wrote:
| It really depends how that process is adopted. If it's
| organically in-house grown and it does makes sense then it
| becomes a synergic glue. If it's imposed top down from the
| outside because "that company does it, lets follow suit"
| then it can become a pain and cause more harm than good. I
| liken that to goo.
| nradov wrote:
| There are two sides to that. Some processes grow
| organically in house in ways that ignore industry best
| practices. Everyone likes to think that their
| organization is special but few really are. They could
| often benefit from an improved process imposed top down
| by someone with broader experience and an ability to see
| the big picture. Of course changing processes always
| involves some short term pain.
| tomnipotent wrote:
| > "that company does it, lets follow suit"
|
| This is always a red flag I'm dealing with someone
| inexperienced, or desperate. Processes can be very unique
| to each company, especially the problems that they're
| facing, and trying to shoehorn someone else's process
| into your own business without understanding the problems
| that process is solving is a recipe for failure.
| GoatOfAplomb wrote:
| Cargo cults: not just for code!
| dkdk8283 wrote:
| > but they idea that there is a single "thing" called
| process and some places have it and some don't is just
| dangerously misleading.
|
| Is that what I said? No.
|
| I got into computers because I dislike people: leave me
| alone and let me work.
| bumby wrote:
| Surely, you have a process that you follow in your own
| work though?
|
| There are formal codified processes and there are
| informal tribal ones. Often when I hear people have
| disdain for processes, it's usually they don't like
| _someone else's_ process. Unfortunately, standardized
| processes tend to become more necessary as systems get
| more complicated in order to ensure an operation becomes
| fault tolerant by not being reliant on a person that may
| leave but instead reliant on a process that stays.
|
| Processes mitigate risk. Just because that risk isn't
| important to you doesn't mean that risk isn't important
| to someone. With that said, there are smart, efficient
| ways to mitigate risk and there are inefficient,
| burdensome ways
| Retric wrote:
| > Surely, you have a process that you follow in your own
| work though?
|
| Personally, no. I have spent enough time at enough
| organizations to simply adapt to whatever they do. But if
| I want to write some code I just do that. I might toss in
| testing or whatever for bigger projects, but it's all ad
| hock.
|
| Processes are about repeatability, but for personal
| projects you can customize based on more specific goals.
| If I want speed, accuracy, or whatever I am going do made
| different choices. I am even going to change things up
| based on whatever mood I am in at the time.
| bdamm wrote:
| The moment your personal project becomes an open source
| project with you as the maintainer, there will be
| process. Manually making releases without any process
| gets real tiring, real fast.
| [deleted]
| mikewarot wrote:
| >Processes mitigate risk.
|
| Processes mitigate risk of repeating a mistake, but they
| don't prevent new ones, unless you have very wise people
| building them, and keeping them current.
|
| Processes can be thought of as an institutional form of
| OCD. There are costs, and they shouldn't outweigh the
| benefits.
| bumby wrote:
| > _Processes mitigate risk of repeating a mistake, but
| they don 't prevent new ones_
|
| I'm not sure I fully agree. Reactive processes prevent
| recurring mistakes, because they layer on a requirement
| to close a gap. I think people can go overboard,
| particularly when they are myopically focused on a single
| risk in their wheelhouse and miss the big picture.
|
| Better processes can be more proactive. For example, a
| process requiring a failure-modes-effect-analysis can
| identify potential faults that have never been
| experienced. Developers may feel like they don't need to
| work on an FMEA because they "know what they're doing"
| and miss latent failure modes
| tartoran wrote:
| I personally don't dislike people but prefer small teams
| where we almost get to read each other's mind. There's no
| magic formula for that, it's just compatibility and it
| usually forms organically. But I also like to get some
| 'let me think alone' time without which my performance
| starts slipping..
| flyinglizard wrote:
| Work on what, though? Work how? What gets prioritized?
| How are things released? How are issues handled?
|
| Without process, more employees just increase entropy.
| The process brings everything together.
|
| What's described in the OP is a process. I run a very
| similar process myself - contractors, minimal friction,
| weak deadlines, no stand ups and all. Supremely
| effective.
| castlecrasher2 wrote:
| Exactly. Good process is there to protect you, bad
| process slows you down.
|
| For example, in companies that deal with medical
| data/PHI/PII, having to go through processes is necessary
| because of liability, no way of getting around it.
| creddit wrote:
| Are you willing to provide any additional clarity on "very
| competitive rates as contractors"? I understand if not but
| would be useful to help some of us externally think about this
| model.
| philipkiely wrote:
| I won't discuss other people's rates but I personally earn
| ten thousand USD per month.
| creddit wrote:
| Thank you for sharing!
| tyrust wrote:
| Thanks for the number. Are you willing to add how many
| hours you're putting in?
| philipkiely wrote:
| It really depends and I don't track my time all that
| well, though one of my 2021 things I'm doing is trying a
| bit of time tracking, just for my own sake / more
| visibility on how I spend my day.
| swyx wrote:
| their official deal is well known - it's a quarter time
| role so formally about 10 hours a week. of course, the
| time they end up actually putting in is up to them.
| poorman wrote:
| People don't realize that as a contractor, you can write off
| the room you're using for your office. As a remote employee
| you cannot. For people living in high rent areas, that's
| significant.
| matsemann wrote:
| _Where I live_ that office has to be a "proper office" in
| a sense, where you could have clients stopping by. Not just
| working from a room next to your exercise bike and laundry.
| Here the tax law is mostly written with hair stylists and
| others in mind, using a room for customers with its own
| entrance.
| eloff wrote:
| Where is that?
| telesilla wrote:
| Countries like the Netherlands expect you to have a
| separate entrance and bathroom before you can claim it.
| Others allow you to claim a percentage of your living
| space and utilities. It varies around the world.
| alistairSH wrote:
| Not always. Highly dependent on country/state and actual
| usage of space (dedicated office space vs a desk/chair in
| the corner of the bedroom). Hire a CPA if you are unsure.
| DVassallo wrote:
| I'm making $10K/mo for a quarter-time PM role at Gumroad (so
| about $250/hr).
| mywittyname wrote:
| Is Gumroad your only gig?
| DVassallo wrote:
| No, I own a SaaS business and also sell my own products
| on Gumroad itself. In fact, the latter was my biggest
| income source in 2020 -- $282K sales last year:
| https://twitter.com/dvassallo/status/1333888186762678274
| asd9900 wrote:
| And you are not even 26? Congrats man, you made it :)
| That's more than I ever made in my life (close to 40).
| cambalache wrote:
| That is OP , not the person you are answering to
| the_jeremy wrote:
| The person who is under 26 is not the same person who
| posted their rates.
| ahmadss wrote:
| I think the parent OP is different than Daniel. Daniel
| worked at Amazon / AWS for 8 years
|
| https://dvassallo.medium.com/only-intrinsic-motivation-
| lasts...
| creddit wrote:
| Thank you for sharing!
| monkeydust wrote:
| Interesting is the Product Management market pretty active?
| What's kind of roles are on offer?
| [deleted]
| draw_down wrote:
| This is maybe the only "how we work" I've ever read that is
| actually appealing. It really does sound wonderful.
|
| My only question is around health insurance for the US based
| folks (I'm guessing the answer is "take the money we pay you and
| go buy some" which is unfortunately not a good solution) but
| otherwise yes, sounds ideal.
| meowster wrote:
| It might be a better solution that tying health insurance with
| a job. Doing so seems to make it harder (more expensive) for
| people without jobs to get health insurance. But otherwise,
| what they're doing seems interesting.
|
| FYI, I had to vouch for your comment. Looking at your comment
| history to see why, maybe try staying away from one or two word
| replies.
|
| Edit: I see HN as a place for people to improve. If it seems
| like someone has the ability to make HN a better place with
| just a minor adjustment, it seems like the best course of
| action for everyone would be to make that person aware of the
| issue and giving them the opportunity to change it, rather than
| hiding it and basically ignoring the person.
| meowster wrote:
| Edit 2: Well then, I see now why that user is shadowbanned.
| My mistake.
| draw_down wrote:
| Hi, please refrain from making short, low-content comments
| on HN that are intended to deride other commenters. Thanks!
|
| <3
| draw_down wrote:
| See, I was talking about health insurance, not HN posts.
|
| Nobody is arguing that tying your healthcare to your job is
| _good_ , certainly I am not, but in many (most) cases it's
| what our system _requires_ because otherwise you pay through
| the nose for crappy coverage. (Or pay a bit less for really
| crappy coverage.)
|
| I'm aware of my HN situation. If you want to vouch for posts
| that's your business, but feel free to take your posting
| advice and cram it. No offense bud.
| DVassallo wrote:
| I work quarter-time at Gumroad, and I pay for my own health
| insurance ($950/mo for a family of 4). If Gumroad offered it, I
| would almost certainly still keep my own (unless it was at >50%
| discount). I prefer not having my health insurance tied to one
| source of income.
| drchopchop wrote:
| How on earth did you find standalone family coverage for
| $950/mo? What's your deductible / co-insurance?
| DVassallo wrote:
| It's actually a bit cheaper this year: https://twitter.com/
| dvassallo/status/1312177408879939584?s=2...
|
| It was one of the cheapest plan on the ACA marketplace in
| WA. It's a very high deductible plan though: $13.6K.
| drchopchop wrote:
| Oof, that's a pretty brutal deductible, although I assume
| you have an HSA paired with that. FWIW, I'm on an Aetna
| corp plan that isn't much better, half the deductible for
| 2x the price.
| phnofive wrote:
| Quarter time... at $250/hr :)
| alawrence wrote:
| Wow, that's not a bad rate. Do you find the coverage
| adequate?
| DVassallo wrote:
| It's a very high deductible plan ($13.6K) but otherwise had
| no problems with provider coverage. I'm in WA and the
| insurer is Molina. Found it through the ACA marketplace.
| [deleted]
| ilovegumroad wrote:
| I wish I had $8M dollars and a bunch of really dedicated people
| to build a company to >$1M ARR and then get rid of all of them.
| At that price you are looking at a company at roughly $X0M value
| already.
|
| Most companies end up having to work tirelessly to grow because
| they have baggage of money that needs return. If you can get rid
| of that baggage it's relatively easy to just slow down and reap
| the rewards. FANG could all probably afford to pay 10x what you
| do for 1 hour of work a month if they stopped trying to grow.
|
| If this post is saying "Hey I got this $X0M company for free come
| hang out with me and I'll give you some of the insane money we
| are making. You don't even need to work much, the people before
| you already did most of work but I'm not giving them anything. By
| writing stuff like this we will get people to buy our coolaid and
| more of our content, by telling them they can also get the same
| life. More money for us." Then that's amazing and more power to
| you. It really is a pretty good deal for the 25 people at
| gumroad.
|
| Genuinely curious if gumroad was started again from scratch with
| no investment if it could get to any kind of scale with the kind
| of work and pay structure referred to in the post.
| thefrog wrote:
| Fuck Sahil.
| didibus wrote:
| > Instead of setting quarterly goals or using OKRs, we move
| towards a single north star: maximizing how much money creators
| earn
|
| I like this. I've always wanted internal metrics to be this (or
| something similar). Like just measure company revenue and target
| increasing it. Goals and OKRs seem like distraction sometimes.
| Relying on people intuition of just how to make the product
| better, not with a specific targeted goal, just overall. It's
| that kind of intangible thing, that's hard to reduce sometimes to
| an OKR or a goal. Which means you can meet all OKRs and Goals and
| yet fail to have made the product better. I think it's because
| OKR and Goals miss on the little details that add up, by having
| you focus exclusively on the big obvious things. Yes this is good
| in some way, get that 80% done, and initially it'll mean success,
| but once competition shows up, it'll be the little details and
| that extra 20% that you couldn't capture in a goal or OKR that'll
| make the difference.
| tinyhouse wrote:
| I must say that's impressive. I've been thinking about this for
| some time. I'm wondering if this new wave of companies would be a
| problem for the economy. Running a company is getting easier
| every year. That's good, more companies means more job
| opportunities. On the other hand, as we can see from the article,
| you can run a very lean remote company and still grow and be
| successful. Such companies would hire less and raise the hiring
| bar and if you're not great in what you do then you'll have a
| hard time finding a job. But long term it's a positive trend.
| treis wrote:
| >On the other hand, as we can see from the article, you can run
| a very lean remote company and still grow and be successful.
|
| Eh, this is a pretty unique situation. They spent a lot of
| money and effort building the initial product and growing
| users. Now that the product is (mostly) feature complete and
| they have sufficient users they can run lean and mean. But that
| doesn't mean they could have run lean and mean while building
| the company. IMHO, you still need the upfront investment to
| build out the core product and acquire a sufficient customer
| base.
|
| The reality of today with interest rates so low is that growth
| is more valued than cash flow. So while lots of companies
| (Dropbox, Slack, AirBnB) could do something like this and start
| generating a bunch of cash they create more value in the eyes
| of investors by growing.
| riversflow wrote:
| It's only a positive trend if society captures the wealth and
| spreads it back. I don't think wealth inequality is a positive
| trend at all.
| UnpossibleJim wrote:
| I was going to say, it's like looking at the "gig" economy as
| a positive trend. This type of hiring process leads to less
| job stability and no health insurance, both of which are
| sorely under represented in the US for as developed a nation
| as we are. I think this is one more disconnect in business
| and success that we have been seeing in recent history.
| jennyyang wrote:
| Very interesting proposition, I hope the company flourishes!
|
| I'm not HR but I'm pretty sure the anti-overtime provision is
| completely illegal at least in countries like the US and Canada.
| I would outlaw overtime instead of pay people less for overtime.
| yarcob wrote:
| I'm pretty sure that most overtime regulations apply only when
| the employer instructs you to work overtime. You get a higher
| rate because you have to work more hours than you agreed in
| your contract.
|
| You can't just voluntarily work more hours than your contract
| states and expect to get paid more.
| caymanjim wrote:
| > I'm pretty sure the anti-overtime provision is completely
| illegal at least in countries like the US
|
| This is incorrect. The tldr is that US employees are either
| "exempt" or "non-exempt". Without getting into pedantic
| details, employees can be categorized as exempt if they make
| over about $23k/year. Exempt employees are not entitled to
| overtime at all, and the Fair Labor Standards Act doesn't
| prohibit reducing someone's hourly pay for overtime in the
| unusual way that Gumroad does.
| NationalPark wrote:
| They're contractors not employees, but you are correct.
| There's nothing illegal about the arrangement.
| Pulcinella wrote:
| The wording of the article seemed unclear to me. You can
| have employees who are on contract. E.g. most public school
| teachers in America are on contract and full time employees
| of the school district. Most employment in the US is at-
| will and not on contract, though.
| throwaway201103 wrote:
| A contractor is different from a contract employee.
| etskinner wrote:
| It's not the wage that dictates that a worker is exempt from
| FLSA overtime. Rather, being under $23,600/yr means you
| cannot be considered exempt. Being paid over that, by itself,
| doesn't necessarily mean that you're exempt.
|
| https://www.fws.gov/policy/225fw6.html
|
| https://webapps.dol.gov/elaws/whd/flsa/screen75.asp
| IG_Semmelweiss wrote:
| correct.
|
| If you are a contractor you should be clear to do whatever
| you want with regards to overtime (because it doesn't
| exist.) Only employees are regulated by overtime laws.
| However as many know the definition of contractor can be
| rebutted by an aggressive state DOL.
|
| Then it comes down to control: Who sets the schedule. Who
| pays the expenses. Who decides what is worked on. Who
| decides how long someone is working, etc.
|
| Remote can only help Gum's case, and the way the founder
| describes the arrangement, it would seem to pass muster.
|
| Be warned that passing muster does not mean that legally he
| would not need to fight it. Founder may mean expensive
| lawyer fees to defend Gum. So word of advice for Gum -
| document your processes for task management and scheduling
| internally , just as you document your code!
|
| Be clear that it is the professionals (not you) who are
| dictating what gets done, and when. That should be enough.
| BoysenberryPi wrote:
| I've been a Gumroad user(consumer not creator) for a long time
| and remember the whole VC situation. At the time, I feared it
| might be the end of the service. I'm glad it wasn't. A lot of
| people want companies like Google or Tesla, however, my honest
| goal in life is to have a company like Gumroad.
| root-z wrote:
| Exactly. It can take decades and all the time you have to build
| the next Google or Tesla and that's in the case that it all
| works out. There are other things to pursue in life and with a
| smaller company you get a lot more control in both the company
| and your own lifestyle.
| vicary wrote:
| Love this, really great approach.
| thesausageking wrote:
| Let me understand this. Gumroad raises $8m from VCs, isn't able
| to grow fast enough, so the VCs agree to give up any claim on the
| company. Sahil fires all of the employees, hires a cheap
| contracting firm and some of the employees back as part-time
| contractors. The company now does $11m in revenue, most of which
| is profit and Sahil keeps.
|
| That's amazing. For Sahil. Not so great if you were one of his
| investors or former employees who had options.
| alex_c wrote:
| You know, I often feel like the success of a business is set at
| the beginning. There is certain trajectory created by initial
| starting conditions (founding team, vision, talent, timing),
| market fit, and external forces and events, and it is very hard
| to escape that. As CEOs and founders we like to think we have a
| lot more control than we actually do.
|
| The point of VC is to inject money to achieve hypergrowth. But
| how much of that growth is achieved because of VC money, and
| how much because of the "natural trajectory" of the business?
| Or to ask another way, what portion of the VC money actually
| affects the trajectory and what portion makes no measurable
| difference?
|
| This graph shows exactly what I mean. If you only had the
| "Creator earnings" part of the graph, would you be able to tell
| where spending was cut?
|
| https://sahillavingia.com/operating.png
|
| I've often felt this way, but this is the first time I see it
| summarized so succinctly in one image.
| mperham wrote:
| Exactly. If you have good growth at the beginning (not
| hyper), you can afford to bootstrap without any VC at all.
|
| To me, VC money pays for marketing spend, most of which is
| ineffectual. Be hyper-focused on putting out the best
| possible product and let it sell itself.
| nemothekid wrote:
| How do you pay engineers? This only makes sense if you have
| the talent to bootstrap by building everything yourself.
| MattGrommes wrote:
| If this negatively affects any former employees that's terrible
| but are we supposed to feel bad for VCs? There have been other
| stories like this where the HN response is "Won't somebody
| think of the VCs!" and I just can't do it. They're adults and
| business people, they'll live.
| [deleted]
| PragmaticPulp wrote:
| > Let me understand this. Gumroad raises $8m from VCs, isn't
| able to grow fast enough, so the VCs agree to give up any claim
| on the company. Sahil fires all of the employees
|
| VCs don't simply give up claims to companies that look like the
| might be profitable. The writing on the wall was that Gumroad
| wouldn't survive without additional infusions of cash from
| investors. If they couldn't find any investors willing to put
| money into the company, it would have gone bankrupt.
|
| In other words, those employees wouldn't have had jobs anyway.
| Their equity would be worthless while the company went through
| bankruptcy.
|
| Normally these companies are sent through arduous bankruptcy
| proceedings, the assets sold, and the investors recoup pennies
| on the dollar. The VCs could have gone this route and Sahil
| could have bought the assets at some nominal amount, but the
| VCs decided that ceremony wasn't worth their time and just gave
| it to him. Or at least that's how I read this.
|
| It might have been more fair if the VCs had given the company
| to the employee equity holders as well, but I assume Sahil
| would have simply bought out their <1-2% holdings for pennies
| on the dollar.
| sillysaurusx wrote:
| The graph speaks for itself:
| https://sahillavingia.com/operating.png
|
| You seem a little surprised. But why? This is the whole point
| of business: to make more money than you lose.
|
| As for why he did it, it looks like he wrote a retrospective
| here: https://sahillavingia.com/reflecting
| hycaria wrote:
| I think it's $11M for the creators that's going through
| gumroad. It's not profit.
| sokoloff wrote:
| Above the fold in the article is "our creators earn over $175
| million a year, and we generate $11 million in annualized
| revenue"
|
| I take that to mean Gumroad's revenue (not gross services
| sales) is $11M/yr.
| treis wrote:
| Their revenue is a bit misleading since most of it goes to CC
| processing fees. This tweet says net profit was 214k in 2019:
|
| https://twitter.com/shl/status/1215673023472140289
|
| Probably triple that this year with the Covid bounce. So
| obviously doing well for himself, but not quite as good as you
| think.
| PragmaticPulp wrote:
| From the Tweet, from Sahil (CEO) himself:
| Gumroad, Inc in 2019: Revenue: $5M (up 46% YOY)
| Gross profit: $1.7M (up 68% YOY) Net profit: $214K
|
| I not familiar enough with the Gumroad model to understand
| why how the creators made $73M in 2019, but Gumroad revenue
| was only $5M.
| tomnipotent wrote:
| Gumroad likely only takes a small cut on each transaction
| (so about 6% in this case?).
| ThrowawayR2 wrote:
| > " _I not familiar enough with the Gumroad model to
| understand why how the creators made $73M in 2019, but
| Gumroad revenue was only $5M._ "
|
| I would imagine that monies collected on behalf of someone
| else for transmission to them do not count as revenue since
| they do not at any point belong to the business. Banks do
| not claim deposits or incoming checks as revenue, for
| example.
| hogFeast wrote:
| It is the difference between gross and net revenue. It is
| why bookmakers don't report all the bets they take in as
| revenue. Banks that trade securities don't recognise the
| money from securities they sell as revenue. Roughly, you
| only recognise revenue on the part of the transaction that
| economically accrues to you. If you are just a middleman,
| you only recognise your commission (this is, however, very
| complex...for example, some companies that trade in
| commodities recognise product sold on the top-line because
| they take ownership of the cargo...so it varies...the
| accounting in this case is what I would want to know as
| someone using the financial statements).
| Rapzid wrote:
| Sounds like it's a market place, so that's the money the
| sellers(creators) received.
| tosh wrote:
| anti-overtime, interesting!
|
| > We also have an "anti-overtime" rate: past twenty hours a week,
| people can continue to work at an hourly rate of 50 percent. This
| allows us to have a high hourly rate for the highest leverage
| work and also allows people to work more per week if they wish.
| kortilla wrote:
| This sounds ripe for a lawsuit or some really bad PR. Wait
| until the labor groups find out you punish the people desperate
| for more hours to make ends meet.
|
| It's better to implement an hour cap or require approval for
| any overtime.
| yarcob wrote:
| But this is an hour cap. The employer is saying, don't work
| more than 20 hours, or I'll lower your rate. It's better than
| a strict cap, since it does offer people to work more if they
| want.
|
| It would only be unfair if the employer would then instruct
| workers to work overtime; I assume that could be illegal
| (depending on where in the world this happens).
|
| But voluntary overtime is very different.
| namdnay wrote:
| The risk is that the employer is saying "don't declare more
| than 20 hours", but everybody knows that you have to do
| more if you want to meet your targets / not be dropped
| _underfl0w_ wrote:
| It seems you didn't read TFA.
| yawnxyz wrote:
| I feel like this is only possible once the product and product-
| market fit have been established; the fire has started burning
| on its own and you can start stepping back and just stoke the
| fire
| dboreham wrote:
| Quick note from my HR friends: beware that there may be local
| labor laws that conflict with this scheme.
| meowster wrote:
| In the US, it makes sense for the company to be required to
| pay a higher overtime rate if they're requiring the employee
| to work more than 40 hours. If the company is saying they
| don't want you to work more than 40 hours, then it seems like
| the law is going against the spirit of its intentions.
| [deleted]
| OJFord wrote:
| They're all contractors, not employees, so it's just a
| different rate depending on the number of hours you bill.
| Your advice is sound in general of course, I just doubt that
| any jurisdiction that accepts them as contractors will have a
| problem with that detail.
| protomyth wrote:
| Being contractors isn't always a shield from some of these
| laws. Check with a lawyer and
| https://www.dol.gov/agencies/whd
| _nalply wrote:
| I think the trick is that contractors don't work full
| time at Gumroad so that they can have other projects. In
| Switzerland for example you are self-employed only if you
| have several clients and are autonomous. It seems that it
| is easier for Gumroad contractors to fulfill these
| requirements.
| elliekelly wrote:
| This is a great idea but I think it would only work in the
| context of "no deadlines" like Gumroad has implemented
| otherwise it would just seem cruel.
| sahillavingia wrote:
| Hey, #1 on Hacker News! I don't think that's happened since...I
| wrote Reflecting on My Failure to Build a Billion-Dollar Company
| back in 2019:
|
| https://news.ycombinator.com/item?id=19105733
|
| Thanks HN for being a part of my journey!
| AkshatM wrote:
| How do you stay competitive with similar products without
| instituting deadlines?
| simpixelated wrote:
| I work for a small company (less than 10 employees) that
| follows a very similar working process. No deadlines, one
| (very short) weekly meeting. We don't try to stay competitive
| with similar products. That's impossible with VC funding
| flooding the market. What we do instead is focus on making
| our current customers happy. Everyone is involved in support.
| We follow up with customers when we do launch features they
| requested, even if that's years later. It seems to be working
| well. It's not going to be hockey stick growth, but "freedom"
| for us (the employees) is well preserved.
| sayrer wrote:
| I thought that plan sounded pretty good, except for the health
| insurance part. Where do you get your health insurance?
| feydaykyn wrote:
| I'm really interested in reducing meetings by writing more, can
| you give some insights on how you do it ? Thanks !
| simpixelated wrote:
| I'm sure there are specifics for Gumroad, but there are lots
| of insights available via other remote companies:
|
| https://blog.doist.com/asynchronous-communication/
|
| https://zapier.com/blog/how-to-work-asynchronously/
|
| Basically instead of waiting for a meeting to communicate,
| just write it down and send it out, via Slack or whatever.
| People can consume it on their own time.
| abinaya_rl wrote:
| Interesting way to run a company. I'm wondering if you provide
| any health care benefits to Gumroad contractors?
| mediaman wrote:
| It's in the article.
| xyzelement wrote:
| I feel about this company the same way as I feel about driving
| Uber. If you already have someone in your family who's making
| money and has benefits, driving it could be a fun way to make a
| few extra bucks and talk to a few people.
|
| So if you're a housewife with a few free hours while the kids are
| at school, or a bored retiree, by all means drive Uber/work for
| this place.
|
| If you're someone in their prime and have to be self-reliant then
| this is as bad a deal as "I'll drive Uber for now" as a life
| plan. You're going to be down the road with no benefits, no
| growth, no title, and nothing to build the rest of your career
| on.
| mrandish wrote:
| > You're going to be down the road with no benefits, no growth,
| no title, and nothing to build the rest of your career on.
|
| "Benefits" aren't free. Every company budgets the cost for
| everything an employee receives as "Total Compensation" from
| health plan to gym to educational credits to free food to stock
| options.
|
| I used to think "free stuff" was great until I started
| understanding how the money really works in this situation. Now
| I would much prefer the freedom to choose the benefits I value
| at the level I choose instead of having them chosen for me in a
| "one size fits all" plan. Just give me ALL the money in that
| Total Comp number and let me choose what to keep in my pocket
| and what I wish to buy.
|
| Comparing a low-skill job like driving an Uber with higher
| skill, more specialized work is apples vs oranges. In a free
| employment market, being an independent contractor tends to the
| most beneficial arrangement for most workers - it's just harder
| to see the full picture when the costs of "benefits" are hidden
| and the true "Total Comp" of an FTE vs IC isn't disclosed
| transparently.
|
| I prefer more transparency (information), more choice, more
| flexibility and more control being in my hands.
| bitdotdash wrote:
| Point out the Uber drivers making $10K/mo for quarter time
| work. Otherwise this argument falls flat.
| xyzelement wrote:
| Is it the guy who was making 400k at Amazon? Paying someone a
| quarter of what they are "worth" isn't that great a trick.
| autarch wrote:
| You missed the "for quarter time work". Earning $10k/month
| working 10 hours a week is pretty close to getting
| $400k/year for an FT job at Amazon (especially if FT ends
| up being more than 40 hours a week).
|
| I say "pretty close" because if you're working on a 1099
| basis there are a bunch of extra costs (extra SSDI
| payments, health care premiums, etc.) that you have to
| cover.
|
| But still, nothing about the article suggests that the pay
| rates are poor, and the upper end ($250/hour) is quite
| good, especially when combined with the ability to work
| less than full time.
| xyzelement wrote:
| Autarch - thanks for breaking it down like that.
| dd_roger wrote:
| I mean, good for the contractors if they like it that way but
| basically this article is bragging that profitability has been
| achieved through a huge step backward in job security and legal
| rights for the employees (or rather, former employees now
| "reemployed" as contractors).
|
| The glorification of the gig economy, i.e stripping everybody of
| the rights usually granted by the status of employee, needs to
| die.
| alberth wrote:
| Am I looking at their expense chart correctly .... it appears
| their monthly operating expenses is ~$100k/month ($1.2M
| annualized) and he states their revenue is $11m/year.
|
| Are they banking ~$10M/yearly in profit and have 95%+ margins?
| antattack wrote:
| "To be clear, we don't provide healthcare. Everyone who works at
| Gumroad is responsible for their own healthcare and benefits.
| Everyone also pays for their own phone, laptop, internet
| connection, and all the other things they need."
|
| It seems to me that company operates like Uber or Lyft, and their
| product is exploiting wage inequalities.
| kfk wrote:
| I would agree broadly but "normal" salary contracts are
| burdened by heavy taxation in most countries. A contractor
| could pay really good private healthcare, build a pension fund,
| insure for disability and a bunch of other things and still net
| a lot more than a salary net for the same role. I don't like it
| but it's what it is and paying public pension for something
| you'll never see is also not fun.
| randomchars wrote:
| At least two people who work there commented, both earning
| 10k/month. A lot of things come to mind, but wage inequality
| and explication are not among them.
|
| https://news.ycombinator.com/item?id=25675002
| martincmartin wrote:
| _an open source project like Rails. Except it's neither open
| source, nor unpaid._
|
| Do people still think of big, successful open source projects as
| unpaid? Rails, for example, was created at Basecamp/37Signals.
| Most Linux contributions come from companies like IBM. Or am I
| the one who's out of touch?
| nitrogen wrote:
| It depends on the project. Some projects (can't think of
| examples off the top of my head, sorry, but they have come up
| here on HN) do reach pretty widespread usage without anyone
| being paid to work on them full time, and potentially with only
| one unpaid developer on the project.
| alexellisuk wrote:
| It depends. Many are paid as career OSS developers to
| contribute to Kubernetes.
|
| The ingress-nginx maintainer just stepped down today because
| nobody would fund his work.
| https://twitter.com/aledbf/status/1347273455448842240?s=20
|
| openfaas is also unfunded and a large project with many
| commercial end-(ab)users. https://www.openfaas.com
|
| Matt Holt behind Caddy gave up after years of struggle and
| managed to sell out to a company.
|
| My take on OSS maintainers -
| https://blog.alexellis.io/the-5-pressures-of-leadership/ - see
| "2. Pay"
| eloff wrote:
| I've been working like this, 16 hours a week for the past year.
| About 3 hours of that is meetings, and the rest is straight up
| coding. I don't make a lot of money, but I've never been happier
| with a job. I honestly don't feel less productive than when I
| worked full time. I spend the rest of my energy working on a
| project I intend to turn into a saas business.
|
| I think this kind of thing, where your job doesn't dominate your
| life should be the future. It's just so much more humane.
| juskrey wrote:
| On the wave of fashionable gig economy, many forget that full
| time employee is not exactly a workforce, but a company's
| insurance which guarantees that chosen workforce will be
| guaranteed at any given point of time and will do nothing else
| (taxing for working abilities) at any other point.
|
| Also, from the worker's standpoint, having two half jobs does not
| equal one full job. It is either much less (with less
| compensation) or much more of what can be comfortable for healthy
| human.
| musingsole wrote:
| Agreed. I will argue that a benefit of the gig economy is the
| average person has more masters (and so is beholden to any one
| master less). I'm open to other models, but that's a feature we
| need to keep in whatever comes next.
| andrekandre wrote:
| > benefit of the gig economy is the average person has more
| masters
|
| how about no masters?
|
| > (and so is beholden to any one master less) that does not
| necessarily follow...
|
| if i still need say 3 jobs to make ends-meet, then im on the
| street if i get fired from one of them... now i need to
| juggle the demands of 3 masters, all with different demands
| on my time, energy and concentration...
| musingsole wrote:
| Sure, no masters is better...though I'm not aware of anyone
| in that position. Manufacturers have customers,
| billionaires the IRS. Everyone's accountable to someone on
| something. Hermits?
|
| Working 3 jobs and losing one is not the same thing as
| working one job and losing one. Losing revenue will always
| hurt. The point is to prevent it from being fatal.
|
| And still, you don't really have an argument here. All of
| this is in comparison to the current system which is worse
| on both these points than a hypothetical 100% gig economy.
| spoonjim wrote:
| I wonder if the VCs now regret just giving the company back to
| the founder who lost their money. $11m revenue growing this fast
| is a lot.
| PedroBatista wrote:
| VCs LOVE this! Not only they underwrote the losses but also
| were presented with an "interesting" experiment.
|
| You can bet Gumroad's case will be "studied" and pushed to
| other companies with VC money in similar situations ( but this
| time I don't think they'll let go the money invested )
| yawnxyz wrote:
| I don't think they would, since I don't think Gumroad is
| growing at any VCs' expected pace, even though they're doing
| well
| tekstar wrote:
| I worked at a FAANG-level startup for a number of years and am
| now doing my own thing, with hopes of building a stable part-time
| business. This appeals to me.
|
| In any company, employee trust is a huge benefit when it works
| and a huge concern when it's missing. this Gumroad model would
| require even higher trust to operate so independently and not
| incrementally add more "check up" meetings and slack etc etc.
|
| Can anyone from Gumroad speak to how they built the team? Hiring
| some roles from your customer community makes a lot of sense as
| they already will have some feeling of propriety. Have there been
| bad hires? I guess having everyone on contract makes it easier to
| move on.
| ftruzzi wrote:
| My team got laid off a few months ago and after experiencing
| remote working this is the only kind of work arrangement I'd be
| happy to apply for. 40hrs a week of remote working does not allow
| for a lot of freedom, ~20hrs sounds amazing.
|
| Really hope more companies start to adopt this.
| AnIdiotOnTheNet wrote:
| Personally, unless there is some clear and dramatic advantage
| to a scheme like this, or it is enforced by law or collective
| bargaining pressure, I think it is unlikely to ever happen.
|
| I hold this belief because I am now convinced that too many
| agents within companies care less about profit and success than
| they do about straight-up owning people. Forcing people to
| spend their time at work is as close to actual slavery as
| contemporary society allows, so that's what they do.
| ftruzzi wrote:
| > Forcing people to spend their time at work is as close to
| actual slavery as contemporary society allows, so that's what
| they do.
|
| I completely agree with this, but I'm not sure this is
| necessarily beneficial for companies (compared to potential
| alternatives). In the end, the quality of their products
| benefits from happier employees, whatever "happier employees"
| means.
|
| When I switched jobs from contracting at a FAANG to working
| for a worse company it was mostly due to bad mood in general.
| The job wasn't interesting anymore and I would feel like a
| well-paid slave. It felt like everything, including the house
| I was living in, was tied to or revolving around my job. It
| felt like I didn't have anything, except the job and what
| came with it.
|
| Had they offered a part-time option with half the money or
| so, I probably would have stayed and started making the steps
| I'm making now as unemployed towards improving myself (more
| physical activity, side projects, volunteering, working on my
| mental health)
|
| It doesn't have to be all the companies though, it can just
| be a few and then a few more. Gitlab and now Gumtree
| definitely stand out to me as one of the very few companies
| I'd be happy to work with and that's because of their
| approach to work.
| solatic wrote:
| > When someone new joins the company, they do what everyone else
| does: go into our Notion queue, pick a task, and get to work,
| asking for clarification when needed... Instead of setting
| quarterly goals or using OKRs, we move towards a single north
| star: maximizing how much money creators earn. It's simple and
| measurable, allowing anyone in the company to do the math on how
| much a feature or bug-fix might be worth.
|
| Quite frankly, this doesn't seem sustainable. There's only so
| much high-visibility/high-value work. When your headcount is
| large relative to "desirable" work, people will compete for the
| "desirable" work. They will lie about the 60 hours of work they
| did last week, and tell you that it's the culturally-normative 20
| hours of work, because it makes them look like 3x engineers.
|
| > expecting responses within 24 hours... we can compete-and win-
| on flexibility
|
| Including in SRE / ops roles, where people need to be on-call?
|
| Let's be clear about something here. You have a headcount of 25,
| and ostensibly nobody is full-time. It's certainly possible to
| avoid internal competition at that size, with the right culture.
| But can you _really_ avoid adding headcount? Can you _really_
| protect your culture from the opportunists, the cutthroats, the
| workaholics? How large can the kibbutz grow before the workers '
| paradise is no longer so sunny?
| gkoberger wrote:
| Does it have to be "sustainable"? It wouldn't work for Google,
| but it works for Gumroad (and, like they said, most open source
| projects). Gumroad is a pretty simple site (and I don't mean
| that as an insult). They don't deal with huge customers, sales
| processes, large data, complicated tech, etc. Most "hard"
| things can be outsourced to a SaaS tool.
|
| So why overcomplicate things?
| 1123581321 wrote:
| What would you say if the answer to your questions were yes,
| yes, and large enough?
|
| Why isn't there enough high-value work? One of their organizing
| principles seems to be that it's okay to do something that
| seems fun or that creators are asking for, so why should that
| stop being a guide for people who enjoy the work they do and
| enjoy listening to customers?
| loceng wrote:
| I still think it's a worthwhile effort to try to scale if their
| path, vision, dictates it. Ultimately I see such bad actors
| trying to integrate themselves into the system - to game the
| system - to be simply increasing waste or inefficiency. So
| while such behaviours may be slowing growth of the system, so
| long as there aren't unmovable blocks introduced, and
| everyone's mostly aligned to leading metrics - then it should
| be fine; potential blocks include things like unions, which is
| why I'm still juggling thoughts and reasoning as to whether
| unions are good or not - likely industry wide they are. A
| failsafe in this scenario is contract workers can all be let go
| easily - minus the domain and systems expertise they have - and
| you'd need the main controller, visionary/founder, to be paying
| full attention and make course corrections when necessary,
| hopefully finding trusted co-captains along the way that are
| passionate with the work more for than financial gain.
| gricardo99 wrote:
| But we can compete-and win-on flexibility.
|
| And then the following part describes: In 2020,
| Sid left Gumroad to start his own creator economy company,
| Circle, together with former Gumroad coworker Rudy Santino
|
| I fail to see this as any competitive advantage since Gumroad's
| "employment" approach literally incubated a competitor.
| leerob wrote:
| If you study both brands, you'll understand Circle isn't a
| competitor.
| dflock wrote:
| They were talking about competitive advantage on hiring and
| retaining good people, I think.
| cambalache wrote:
| This seemed straight out of a Silicon Valley episode.
| 2ion wrote:
| The owner of Gumroad is already rich, so competition doesn't
| matter so much anymore.
| jvns wrote:
| One thing I find a bit strange about this (as a Gumroad user) is
| that Gumroad employees don't seem to be granted @gumroad.com
| email addresses -- when I've needed to email their engineering
| staff or marketing staff I often get replies from someone's
| personal email address.
|
| The fact that employees are using their personal email address to
| do Gumroad business makes me feel a bit uncertain about how
| securely my information / my customers' information is being
| stored.
| that_guy_iain wrote:
| > The fact that employees are using their personal email
| address to do Gumroad business makes me feel a bit uncertain
| about how securely my information / my customers' information
| is being stored.
|
| I know there is a legal thing in some countries where ext
| contractors must have a different email. Normally this is done
| by creating a new domain for the contractors or a sub-domain
| but Gumroad could be that new they haven't encountered this
| yet.
| cromka wrote:
| I truly doubt that's the case: absolutely none of the
| contractors employed by the global-brand investment bank I
| work for use e-mail addresses that are any different than
| those of the FTEs.
| eloff wrote:
| I've encountered this in my work as a contractor. Depends
| on the company.
| that_guy_iain wrote:
| I think it also depends on the country because we didn't
| seem to have it when we were just a German company but
| when other countries became involved I think we had to
| implement legal requirements for them.
| underseacables wrote:
| No health benefits, no unemployment ....
| throwaway201103 wrote:
| But an hourly rate which allows you to fund those things
| yourself.
| benmanns wrote:
| But also fully deductible work-related expenses, including
| health insurance, and ability to fully fund a solo 401k.
| jacobsenscott wrote:
| Are you sure health insurance is deductible? There was a time
| it wasn't. Either way that's peanuts compared to a benefit
| that covers most of your premium. Fully fund a solo 401k is
| also nothing special compared to a proper matching 401k. This
| is just a freelancing gig, and not "working at gumroad".
| tothrowaway wrote:
| Health insurance premiums are deductible for self-employed
| people (and 2%+ S-corp shareholders): https://www.irs.gov/p
| ublications/p535#en_US_2019_publink1000...
| thordenmark wrote:
| Gumroad should have been Patreon.
|
| Sahil Lavingia is so much more respectful of creators than Jack
| Conte.
| realDjangoB wrote:
| Another california liberal fleeing to Texas and voting there for
| the same policies that made california worse.
| lynguist wrote:
| You mean outsourcing? Or what? Or concentration of wealth in
| one spot?
| jkuria wrote:
| By the way, here's an interview with Sahil, where he talks about
| his "Failure to build a $1 billion company..." and how it ended
| up being a blessing in disguise:
|
| https://capitalandgrowth.org/answers/Article/2987051/Candid-...
| lr4444lr wrote:
| No deadlines? For how long does someone have to not "produce
| something that's better than what's on production" for you to
| decide he's not fit to keep getting a paycheck?
| randomchars wrote:
| People can get fired from 40h/week, meeting and deadline heavy
| jobs too.
| wnoise wrote:
| Deadlines are usually tied to specific things. "Being
| productive" only requires getting one of any number of things
| on a task list done.
| Pulcinella wrote:
| TL;DR The founder of Gumroad fired all his employees and replaced
| some with and rehired some on contract. Gumroad does not provide
| benefits like healthcare. Your hourly rate gets cut cut in half
| after you work more than 20 hours a week.
|
| The article is a nice way of saying that the founder largely just
| collects rent while putting minimal resources into the business.
| conqrr wrote:
| This is right. They sell the whole picture of freedom really
| well. Contractors have existed for long, nothing new. The
| product is in a unique position to not need a lot of Full time
| employees and like he said, its accidental. I do like it though
| (and had underestimated) that there are lots of people who are
| ready to consider working like this in tech.
| CydeWeys wrote:
| Yeah, hard pass. If I'm gonna be a 1099 contractor my rate will
| need to be _very_ high (roughly $500 /hr). Otherwise I'm
| sticking with my FTE job. And I'd need to be able to pick up
| more than the 20 hours per week than this guy will give me too,
| so I'd need multiple clients.
| dkdk8283 wrote:
| 20 hrs a week @ 500 is 520k/y. you only need one client.
| jacobsenscott wrote:
| minus vacation, taxes, health insurance, overhead (time
| tracking, billing, book keeping, etc), time between gigs.
| 20 _500_ 52 you are coming in way high. You can cut that in
| half and get a reasonable estimate for take home.
| bing_dai wrote:
| There are people who are perfectly happy with about $250K
| of take-home pay a year if that means they have plenty of
| freedom to do other things. In fact, I bet many people in
| the US will be happy with $30K a year, not $250K.
| yawnxyz wrote:
| at that rate they're probably the top of the field? I'm a
| UX engineer for ten years and the highest rates I've seen
| are "only" 200ish...
| biztos wrote:
| Based on the article it doesn't sound like you couldn't make
| that much, as long as you convinced the boss it was a good
| investment, and then made sure it was.
|
| And on 1099 you can have as many clients as you want.
|
| I can understand why someone would pass, but within its own
| context it doesn't sound like a bad deal to me, particularly
| for people who for whatever reason don't need to bill that
| high.
| darth_avocado wrote:
| I've had some contracting experience as a freelance dev. In
| my experience even smaller companies (not Google, FB etc.)
| tend to have high budgets. I ended up with gigs anywhere
| between $200-300/hr, but that was 40 hrs week. Of course you
| have to pay for insurance, get your own retirement plan and a
| bunch of other logistics stuff, but it can make you a lot of
| money.
| simonbarker87 wrote:
| Congratulations on this success! Gumroad is a valuable service
| for many people and the founder seems to have a great balance of
| time, flexibility and income.
| lrossi wrote:
| > While Gumroad was no longer on track to become a billion-dollar
| company, I acquired a new asset: time.
|
| That's okay, becoming a billion dollar company doesn't have to be
| your goal.
|
| Staying smaller might be good not just for your work-life
| balance, but also for the user experience. Some prefer the
| stability it brings: you don't have to worry that features or
| projects get canceled because they are not growing fast enough;
| that the app gets sold to some social network that starts spying
| on users or an AI is blocking accounts inexplicably etc.
| epa wrote:
| No process works great until something goes wrong, then you need
| process to fix it/prioritize it.
| simonebrunozzi wrote:
| I just want to say that I really loved this blog post.
|
| Of course it isn't for everyone. But I bet that most "online"
| companies should learn a thing or two from Gumroad.
| boo-ga-ga wrote:
| I think the critics who complain about money, pensions and
| healthcare didn't do proper calculations. Gumroad pays from $50
| to $250 per hour. Let's say you get $100 (below average) and work
| 60 hours per month (one-week vacation every month). This is $6000
| per month, which is basically more than enough for a comfortable
| living in 95% places on the planet. They pay equal money
| regardless of location, so the proposition is great for anyone
| except a tiny number of people who want to live in extremely
| expensive places.
| ryanianian wrote:
| It's worth noting the hourly rate cuts in half after 20 hours.
| It's still enough pay for comfortable living, but 60hrs/wk is a
| lot of work and is decidedly against the lifestyle TFA talks
| about.
|
| [edit: parent says 60hrs/month. At $100/hr that's $72k/year
| pre-tax. I don't know how to delete this comment but would if I
| could.]
| autarch wrote:
| The parent says 60 hours per _month_. That's 15 per week.
| Sounds good to me!
| StevenWaterman wrote:
| Parent says 60hr / month
| [deleted]
| [deleted]
| codemac wrote:
| And as a contractor there are significant tax advantages, along
| with personal growth advantages.
|
| I think the big draw back is actually long term total earnings
| - the big companies in SV still pay order of magnitudes more
| than that.
| dutchbrit wrote:
| Hey Sahil, I remember you from way back (TalkFreelance days - Sam
| Granger)! Really awesome & interesting to see how you've grown
| Gumroad to what it is today, impressive!
| systemvoltage wrote:
| I honestly think this is great. We can precisely write, but
| cannot precisely voice. Auditory communication through mouth and
| ears is low bandwidth, has high dependency over who has more
| testosterone, energy, enthusiasm, listening skills, attention,
| retention and record, etc. Writing has a permanent record, you
| can take time to form your opinions and respectfully argue.
|
| What are the downsides? I think immediate feedback, and fast back
| and forth in voice communication is what I miss the most. And
| ofcourse, bonding with people.
| agumonkey wrote:
| Writing can be tweaked and even faked. Vocal communication has
| other valuable traits. Also human work is often emotional.
| paxys wrote:
| I work for a large SaaS company with hundreds of engineers and a
| very healthy revenue. It's widely acknowledged that the company
| would continue to function exactly as it is now for a very long
| time if they fired 95% of the staff. Heck stability and uptime
| would probably improve due to fewer deployments/no new feature
| adds. So the graph with declining expenses and increasing revenue
| isn't at all surprising.
|
| The problem with this model is that you are coasting on the work
| done by your full time staff in the initial few years, whom you
| fired and replaced with part time contractors who get no
| benefits. Even putting the ethical issues with this aside, if a
| competitor takes interest in your space and has a large war
| chest, you'd be powerless to compete with them. And when your
| tech is dated and current/new customers want innovation, your
| low-price contracting firms working a few hours per week
| certainly aren't going to be able to offer that.
|
| So while I'm happy things are working in this case, no new
| company that starts with the environment you are describing is
| going to be successful.
| dcolkitt wrote:
| If a competitor takes interest in your space, and you're
| already profitable, they're as likely to acquire you as compete
| with you.
|
| A fully VC-funded SV unicorn is gonna demand a pretty high
| price tag. There's a lot of mouths to feed and liquidation
| preferences to payout. OTOH, $10 million is a pretty attractive
| payout for a single person, or even a handful.
| paxys wrote:
| Large companies are mostly looking for rapid growth and/or
| talent when they consider acquisitions, and this one has
| neither. Single-digit millions in revenue is inconsequential
| in the industry today.
| Grimm1 wrote:
| You're missing IP acquisition which is the third well
| considered type of acquisition consideration. Not saying
| you're wrong here just wanted to add that.
| _hyn3 wrote:
| As well as pre-built customer base, loyal community, etc.
| femto wrote:
| > you'd be powerless to compete with them.
|
| A substantial potion of the part-timers could temporarily
| increase their working hours, possibly doubling or tripling the
| rate of progress overnight. The company of part-timers
| effectively has an additional prequalified workforce waiting in
| the wings for emergencies. The company would then have a period
| of time to put arrangements in place to bring each person's
| hours back to previous levels.
| boo-ga-ga wrote:
| Sahil says they pay $50-$250 per hour. I would not call it low-
| price:).
| coffee wrote:
| > if a competitor takes interest in your space and has a large
| war chest, you'd be powerless to compete with them
|
| If that were true, every single company that had more money to
| spend would always win. But that's not what's observable. There
| seem to be other factors at play that don't always center
| around money.
|
| > no new company that starts with the environment you are
| describing is going to be successful.
|
| That would mean no upstart could ever compete in the same space
| any established player. But again, that's not what's
| observable.
|
| It appears to be much more multi-faceted than just "he who has
| the most money always wins."
| andreilys wrote:
| Seems to be the case with Facebook that just acquired all
| their competitors once they became a threat.
| coffee wrote:
| Not all companies desire to be acquired, even when offered.
| Not all deals go through, even when desired. We often hear
| of those that do get acquired, more rarely those that don't
| - Facebook has notably failed making attempts. Those
| companies are still going strong. Facebook didn't kill
| them.
| colonwqbang wrote:
| Maybe it's not what you would prefer but the owners of
| those companies probably saw themselves as winners. Unless
| Zuckerberg forced them to sell at gunpoint?
| didip wrote:
| So... is this legal? I guess it depends on where you incorporate
| the company?
| randomchars wrote:
| Why wouldn't it be? Hiring contractors, and not employees is
| completely normal and legal in most countries.
| gnud wrote:
| Hiring contractors is legal. I can't think of anywhere it's
| not.
|
| Sometimes, companies try to cheat by claiming that their
| employees are contractors. But this actually sounds like they
| really are contractors. No fixed schedule, work with the tools
| you want, even choose the tasks you want (within reason). So
| this sounds completely fine to me. Of course, IANAL.
| jedberg wrote:
| In regards to the health insurance thing, there is a good middle
| option. I'm not affiliated but I use Savvy
| (https://www.gosavvy.com/).
|
| They take advantage of a law that just started in 2020 that lets
| a company owner offer tax free insurance payments without having
| a health plan.
|
| Basically you set a budget, and then the employee chooses any
| health plan they want from any provider and pays with tax free
| money. If they spend more than your budget it just comes out of
| their paycheck, so you could theoretically set the budget to $0
| and at least let them have tax free health care payments.
| paxys wrote:
| If you are self employed and itemize your deductions (like
| everyone working for this company I assume), your health
| insurance premiums are already tax free. Don't need an external
| service for that.
| rwmurrayVT wrote:
| This is for employees at companies that do not offer health
| insurance.
| paxys wrote:
| So is what I am talking about. If you are a contractor,
| your health insure premiums are a business expense and can
| be deducted from your taxable income, even if you are
| paying for them out of pocket.
| jedberg wrote:
| It wasn't clear to me whether they are 1099 or W2 employees.
| If they're 1099 then yes, it doesn't matter.
| pimterry wrote:
| They're not explicit about this, but I suspect part of the
| reason they don't offer health insurance is that their
| remuneration is intended to be location independent.
|
| Moving any fixed X of remuneration into health insurance will
| be wrong in many locations (in many places, standard health
| care doesn't require employer insurance, so the expected X for
| most jobs is 0, and any X > 0 is undesirable). Doing wildly
| varying custom health insurance setups for each employee
| according to their current needs seems complicated. If every
| 'employee' here is actually an independent contractor, can't
| they just pay for health insurance themselves from their
| remuneration however they please, and do so tax free as their
| own business expense?
| coldcode wrote:
| I worked for a very large company you would all know, not tech,
| where deadlines are the start of any project, even before the
| details are more than vague ideas, meetings happen every day on
| multiple projects the same team has to work on overlapping, and
| full time is a dream (hint its a lot more). Living the dream.
| root-z wrote:
| FANG employee here. Same.
| pietrovismara wrote:
| This looks really great. I've been thinking for a while to start
| a tech co-op with the only goal of giving the best benefits
| possible to its members in terms of pay and freedom, while being
| completely independent from investors/shareholders and the
| delusion of perpetual growth.
|
| This is both a confirmation that you can work on big projects
| without necessarily grinding away all of your time and energy,
| and that perpetual growth isn't a necessity.
| jimbob45 wrote:
| > Instead, I found an Indian firm called BigBinary and hired a
| few engineers as contractors.
|
| > Since its inception in 2011 BigBinary has been remote and all
| 100+ team members are spread all over India.
|
| So you outsourced development to take advantage of Indians so
| desperate for a job that they'd accept lower pay and pocketed the
| profit for yourself? I don't understand how outsourcing is still
| legal when we have scumbags like you who show us problems with
| it.
| k__ wrote:
| While I don't appreciate the firing and re-contracting of
| employees, I think the basic idea is good.
|
| Would just be nicer if he had it before he had to let down people
| who trusted him.
| rgbrgb wrote:
| This is a really interesting conception of a company structure
| that leans towards maximum flexibility.
|
| The thing I don't see talked about here or in the post is equity
| ownership stakes. Distributing equity to give employees real
| money incentive to improve company performance has been a
| hallmark of tech companies at least since Fairchild Semiconductor
| and the traitorous eight. On the other hand, I've seen small
| companies in other industries thrive with very concentrated
| ownership and no employee equity system.
|
| Do Gumroad employees get equity? Who owns Gumroad and would
| profit from a change of ownership? Are there ramifications there
| in terms of work output and team dynamic?
| staunch wrote:
| I'm genuinely curious what Gumroad Creators are selling. Is it
| 95% porn revenue, with a veneer of ebooks and videos? Or is there
| actually a sizable market for other digital goods?
| _bohm wrote:
| It's quite easy to go browse the site and see for yourself that
| there's a pretty wide variety of stuff on there.
|
| In my particular niche (music production/sound design) a lot of
| indie creators sell Max for Live devices on Gumroad:
| https://gumroad.com/discover?category=music&query=max%20for%...
| philipkiely wrote:
| Not porn, mostly, see https://gumroad.com/company
|
| Here is a small sample of things of interest to an HN audience
| that you can buy with Gumroad:
|
| https://gumroad.com/fullstack
|
| https://gumroad.com/adamwathan
|
| https://gumroad.com/traf
| LegitShady wrote:
| I don't think gumroad allows adult content at all.
| WrtCdEvrydy wrote:
| I've seen some 3d printed items being sold (the blueprints)
| [deleted]
| dkroy wrote:
| Such an odd way to ask this question from my perspective.
| Though this could be because I am missing something. Is this
| product popular in that industry? Is there a reason you lead
| with porn?
| biztos wrote:
| I was wondering the same thing, because just yesterday I
| encountered a mention of Gumroad together with OnlyFans in a
| blog by a creator. Had that not happened I too would have
| found the parent comment odd.
| vlucas wrote:
| All kinds of legitimate things are sold on Gumroad. I created
| BudgetSheet ( https://www.budgetsheet.net ), which I sell
| subscriptions to via Gumroad. It's ramping up slow, but this
| year it broke $1k ARR. My goal is to 3x that this year.
|
| Income Proof:
| https://www.dropbox.com/s/wzatabooj5hocug/Screen%20Shot%2020...
| marcinzm wrote:
| Personally I actually like deadlines if project scope can be
| adjusted to meet them and there's no crunch time. It forces
| everyone to focus on getting a concrete deliverable out rather
| than getting side tracked for months on pointless features or
| additions or optimizations. And as an introvert having N mini-
| jobs where I have to keep track of N times as many people sounds
| like hell.
| happyweasel wrote:
| Gumroad is basically feature complete. I use it to support
| content creators (about 300 purchases or so), and never found the
| website to be particularily cool or useful. Search sucks most of
| the time. At least it doesn't get in the way, well unless it
| does: They have this feature to archive an item in your library,
| and then it disappears from your library, and you have to dig it
| out again. Funny thing is: when you hoover over an item in your
| library, a menu appears, and the archive entry is exactly
| positioned in the middle. So if I try to select an entry by left-
| clicking it I often hit the archive button. lol. Also download
| sucked for a very long time (dl from europe was slow and
| completely downloading everything in one archive wasn't supported
| for a long time). So yeah, it's good enough at least it's a way
| to more-or-less-directly support content creators.
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(page generated 2021-01-07 23:00 UTC)