No meetings, no deadlines, no full-time employees
sahillavingia.com
sahillavingia.com
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.
This might be true for everyone at Gumroad, but I wouldn't be so sure. You also seem dismissive (probably unintentionally) of one of the biggest problems we have in the US right now: health care and insurance is ridiculously expensive–especially for people with families who want to be self-employed or contractors.
A family of 4 who doesn't qualify for ACA subsidies is going to pay $1,400/month or more out-of-pocket for health insurance. And it goes up every year. Imagine paying 10%+ of your salary just for health insurance.
I decided to actually look at my budget from the last year and see how this compares to my costs.
In Australia I pay about ~28% of my salary in tax. 2% is for medicare, and I have private health insurance on top of that for roughly the same cost again (for dental, which isn't covered in our system because of dentists lobbying an exception back in the 80s). You still have to pay part of most costs in Australia, looking at my budget that's come out to about another ~1% of my income in the past year.
So I pay 5% of my salary for health services. It's pretty much inline with other costs like food and utilities. Doubling it to 10% would be doable, but it would suck.
It seems that the US system doubles the cost and the extra money serves as the very healthy profit margin of their private health industry. Keep in mind Australia manages to sustain a private health sector off that 5%, this isn't abolishing private health by any means.
A proper government health system could probably be even cheaper than the 5% I pay because the US has much better economies of scale. Not to mention the benefit of untying it from employment.
I'm not really making a point here, your comment just inspired me to compare the numbers and it sure is grim...
This is a common misunderstanding in Australia.
The Medicare levy, as it's called, is an administration levy, not a 'this all goes to healthcare, and healthcare is only funded by this' tax.
Originally set in 1984 at 1% and guaranteed to never to go up <tm>, it is now at 2%.
(Aside - within two years it was raised to 1.25%, then in 1993 bumped to 1.4%, in 1995 raised to 1.5%, in 1996 the Howard government set a temporary <sic> increase to 1.7% (ostensibly related to gun control costs) which did drop back in to 1.5% the following year, but in 1999 there was an attempt to bump it up again to 'cover the costs of our military involvement in East Timor' - this didn't happen, but it speaks volumes. In 2010 we suffered the regrettable corruption of 'if you earn more than ~$100k AUD you will pay an additional 1.25-1.5% unless you buy private health insurance'. Further fiddling got us to where we are now. Much sad.)
Point being it's incorrect, and quite misleading, to assert that 2% of your salary 'is for medicare', as a simple breakdown for public health shows that, per-dollar, it's somewhere in the range of 10-25%, though because money is fungible, budgets are intentionally fuzzy, and definitions of healthcare somewhat flexible, an exact figure isn't easy to determine.
ACA is not a great alternative and I lament the fact that I pay more for health care (even if I don't use it at all) than I do for my mortgage, utilities, internet, and phone bill every month. (Midwest, LCOL).
In Germany it's 14% that is split between you and your employer, so I guess you'd have to all of that on your own if you are self-employed. Granted, you can also choose to have a private health insurance which will seem cheaper but gets outrageously expensive with ages and it is very very difficult to get back to statutory insurance.
I don't want to be dismissive, but with a full remote job why not go live in a country where healthcare is a thing? Especially if you have a family. Now that I'm writing that, I realize that it might be hard to get a Visa.
Just for comparison.
Disclosure: I no longer live in Germany _but_: In Germany, 90% of people are insured via the mandatory public health insurance system (do a Google translate on https://www.bundesgesundheitsministerium.de/gkv.html, which is the official federal health ministry website). That's 70 million people out of ~83 million in an estimate of 2019 according to Wikipedia. There's still a bunch of different companies that provide coverage under this public system. I remember ~15%+ depending on which company you went with for health insurance. And that's the _public_ system.
You can play around here if you want: https://www.brutto-netto-rechner.info/. I plugged in 70.000EUR per year (which is reasonable for a senior dev depending on city (i.e. this is way more than I was paid in Frankfurt 10 years ago but we're talking different level and 10 years ago ...) but you'll get less even as a senior today probably if you're in some "flyover state" equivalent of Germany.
Where it says "Rentenversicherung" that's your pension. Where it says "Arbeitslosenversicherung" that's your EI. Where it says "Krankenversicherung" that's your health insurance. Remember, this is the public system, which has been going way down hill since I was working in Germany. Nowadays you gotta have a separate insurance for certain things in dental care for example, that were just covered for me, when I was there.
So for my EUR 70.000 / year example health insurance is ~4.5000EUR or about 6%. You gotta remember in that that the employee and the employer share this 50/50, meaning the ~4.500EUR is for the employee only. The employer pays another ~4.500EUR (officially the public health insurance system rate is like 15% and there's all sorts of rules about what extra percentage a public health insurance can charge and different companies charge different extra rate to try and 'compete' with each other.
So with all this in mind and percentages already given (and please do look up the German "progressive tax system" as opposed to the tax bracket system in the US and Canada), 70.000 EUR is about 86.000 USD or 4.500 EUR being about 5.500 USD.
The Netherlands is just this tiny little kingdom in Europe that basically has all their ducks in a row. Nothing is super great, but nothing is bad either. It's my gut feeling that anything around 8% is really just the cost of health insurance that covers mostly everyone.
That cost doesn't go away for people who are regular employees, it just gets absorbed by the employer. That's a big part of the reason you need to make more as a contractor than as an employee. Lots of costs get covered for you pre-paycheck as an employee that you have to pay post-paycheck as an independent contractor.
https://en.m.wikipedia.org/wiki/List_of_countries_by_total_h...
I'm incensed at the idea we leave families out in the cold like that - IMO healthcare should be free - but I don't find my care to entirely unaffordable.
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)
"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.
If you're early-stage Facebook or most consumer-facing recreational apps, "move fast and break stuff" with minimal process is great, since the potential downsides of pushing a bug to production are usually far outweighed by the value of iterating quickly. You can trust your developers to do the right thing, because for the most part developers will, and on the rare occasion that someone doesn't, the consequences are not severe.
If you're Signal, or a FinTech company, or NASA, or a medical device company, then you need significantly more robust process to ensure that appropriate quality control, chain of custody, etc. is being applied at each stage of the process. Trust alone no longer works because even though it will get you the result you need _most_ of the time, that is not a high enough success rate.
Put more generally, more/improved process is required when you cannot tolerate a given failure rate, and in general you trade off throughput against failure rate.
Having said all of this, many companies cargo-cult Google and add process when they don't need to raise the quality bar, or implement poor process that fails to increase the quality bar; these would be examples of bullshit process as the GP puts it. However I feel like we're often not presented enough context to disambiguate appropriate process from BS.
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".
Is that what I said? No.
I got into computers because I dislike people: leave me alone and let me work.
either one person is calling all the shots, or decisions are made through email discussions or irc or whatever forum they favor nowadays.
synchronous meetings are not required. if you consider that in a meeting everyone takes their turn, people respond to each other, and eventually maybe vote on decisions, all this can be done by email. it just takes a bit longer, and you have to factor that in your time planning.
not having meetings doesn't mean that people don't talk to each other.
These changes did not impact me though however, as the new "quick and efficent" method still provided me with a much smaller tax return than documenting all of my own costs. [2]
[1] https://www.ato.gov.au/Individuals/Income-and-deductions/Ded...
[3] https://www.ato.gov.au/General/COVID-19/Support-for-individu...
> In practice, we pay everyone hourly based on their role. The range varies from $50 (customer support) to $250 (Head of Product) an hour.
> Recently I standardized our rates world-wide
> 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.
Sounds like it's $50/hr up to 20hr/wk, $25/hr thereafter. For 40hr/wk, that's $1500/wk or $6000/mo or $75k/yr (assuming 2wk unpaid vacation).
Not bad honestly.
Have you looked at how much decent health insurance coverage costs on the individual market without income-based ACA subsidies?
It's absolutely insane, and even more insane if you want family coverage. For a similar, but nowhere near equivalent, of an employer provided healthcare plan, I'm looking at spending more than $9,000 in premiums each year, a $3,000 deductible, a $8,000 out-of-pocket maximum and co-pays for doctor visits and medication.
If I add a spouse and one kid, for a plan similar to an employer provided plan, premiums sky rocket to over $30,000 a year, with a $5,000 deductible, a $17,000 out-of-pocket maximum, co-pays etc.
I wrote a long and very emotional response to this. In the end I decided to simply say that, if I worked at Gumroad instead of at an employer who pays me about 10% less but pays even just part of the premium on mediocre health insurance, the events of the last six months would have killed my partner, bankrupted me, and left me widowed and homeless in the middle of a pandemic.
At best, I'd be six figures in medical debt.
At worst, I'd be seven figures in medical debt.
You all can go without insurance? Great. That's great _for you_. Congrats _to you_. Good luck _to you_.
Yes, the system is horrendously broken. But just acknowledge — just _acknowledge_! — that it's a massive, massive, massive privilege to be able to afford to work a job that doesn't offer health insurance in the United States as it exists right now.
Consider how many people absolutely cannot fathom working for Gumroad as a result. I don't want to hear you do it. Just think. Think about it. Please!
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.
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."
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.
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.
This is all very similar to standing armies. The more people, the more expense but better protection. What countries do, therefore, is let other countries do part of their jobs, ie US protecting many other countries who don't have large militaries. I'm not sure what the analogue is in business, maybe partnerships?
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:
(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.
From the private insurer's point of view, it would be crazy to charge more or less based on how much someone works or earns. The public insurance does so out of a solidarity imperative coming from the government, and is subsidized as needed to make that possible.
In the US, there is no public option. Feature working as designed, for better or worse.
...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).
You mean they would only be WILLING to pay 70%. I'd wager the vast majority of people with salaried jobs don't spend 100% of their work time working. Many jobs can be done in a fraction of the time. I don't doubt that most people could lose a day and probably gain productivity on the other days.
Probably more to do with Britain’s Factory Act of 1833 and follow up Act of 1844.
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.
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.
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.
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.
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.
I feel that the part-time jobs trend now is like the remote jobs trend in 2007. It's still in the early days.
And isn't 28 hours 3.5 days?
And ye, a few people have mentioned the point about 28hrs - I'm going to rebrand it as "4 day 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
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...
In the Netherlands it works exactly like this. Half my team is on either a 90% or 80% contract. Other half doesn't have children yet :P
https://news.ycombinator.com/item?id=19105733
Thanks HN for being a part of my journey!
I'm a customer of several smallish (but bigger than 10 employees) services and if I'm paying something like $120/year for something even remotely useful, I'm not going to switch unless the competition solves a specific problem or I'm really mad at the current provider. In the former case I would at least have told support about my problem.
I do believe that there is "enough" money to be made solving real-world problems for people and treating them like humans so they aren't going to drop you like a hot rock at the first chance. I'm happy to see some voices confirming that in this thread.
[Edit to clarify because this is being downvoted: many countries require that independent contractors buy private health insurance. Germany, where I live, requires it. As I understand it the situation is similar, for different reasons, in the USA. So independent contractors are very often all in the same boat, insurance-wise, but that boat varies by country.]
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.
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?
So why overcomplicate things?
Great code is both simple and has the ability to scale if needed in the future.
Well, yes. Sustainability doesn't only mean "in the face of expected large growth", it means (for example), here's a culture that the company likes, can that culture continue to thrive through the coming years?
I suspect that scares off workaholics.
It's definitely sustainable if they don't plan to grow, and frankly it might still be sustainable at much larger sizes
I suspect that anti-overtime policy, at scale, is somewhat like a salaried position. When you earn a salary, your salary is guaranteed regardless of how many hours that you put in. Why work more than 40 hours a week? But in the real world, gains and promotion often go to people who "bleed" for the company. If salaried positions, which offer zero overtime pay, end up promoting overwork, why would offering a partial reward of half-pay factor in at all into whether the company has an overwork culture problem or not (particularly if reporting hours is the responsibility of the employee and the employee can simply decide not to report the overtime hours)?
Even if people do overwork, they should only do it with that as a baseline, which should keep anyone from 80 hour workweeks far away (why would I work there for 80h/week when Netflix would pay me 2-4x for that much work?)
You might see people working 40h/week but I'm not seeing why that is bad for the company or culture.
I think you're pushing at "there will be people who really want a pay raise and they will work long hours to get it" but I honestly just don't see that happening. It only happens if it's rewarded, and they've set up what seems to be a strong culture that motivates people to not work too much.
It seems like their current culture consists of people who don't want to be defined by their work. The post notes this explicitly.
If the employees will overwork, I suspect it will be on their side projects, and more power to them
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?
Then their model isn't replicable as a "better way of working" in general. Most companies with 50+ headcount aren't going to suddenly slash their headcounts down to 25 so that they can assert the cultural benefits that can be achieved with a small workforce and clear messaging that exponential growth is neither expected nor desired. If their model isn't replicable, then it doesn't have as much to teach us.
I would agree though that if a lesson is repeatedly refused, the pedagogy must change.
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.
Seems to me the post wasn't even claiming to have >$1M ARR either (there was a graph for the creators ARR which I think is different?) and that everyone does work... they just do it using a non-traditional process.
edit: There's this: https://news.ycombinator.com/item?id=25675713 which might point to >$1M ARR?
edit 2: I also realized in a business like this ARR just doesn't matter (who cares? You're not trying to raise another round or IPO). https://twitter.com/shl/status/1215673023472140289 shows the net profit and it amounts to 1 senior engineer's salary. That's amazing for a small business with a small number of employees but it's not exactly living high off the hog.
And they’re definitely getting more than $1M ARR, not just creators ARR.
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.
That's amazing. For Sahil. Not so great if you were one of his investors or former employees who had options.
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.
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.
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.
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.
Gumroad, Inc in 2019:
Revenue: $5M (up 46% YOY)
Gross profit: $1.7M (up 68% YOY)
Net profit: $214K
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
I take that to mean Gumroad's revenue (not gross services sales) is $11M/yr.
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.
> 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.
It’s better to implement an hour cap or require approval for any overtime.
[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.]
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.
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.
But we can compete–and win–on flexibility.
In 2020, Sid left Gumroad to start his own creator economy
company, Circle, together with former Gumroad coworker Rudy
Santino
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.
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?
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.
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.
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...
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.
I cannot stand tracking hours. No thanks.
A friend of mine works at a law firm and they track by the minute, as in people record when they go pee and when they come back. that sounds like hell. So I see where you are coming from.
It strikes me as cruel. But in any case, just not my cup of tea.
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.
I'm in the process of negotiating a similar setup with my employer, at my previous organization I worked 60% and also felt very happy with that. It seems to be hard to arrange unless an employer already knows you, though. (At least for interesting/challenging jobs with growth.)
Really hope more companies start to adopt this.
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.
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.
Would just be nicer if he had it before he had to let down people who trusted him.
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?
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"
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.
You can't just voluntarily work more hours than your contract states and expect to get paid more.
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.
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.
[1]: https://smaslennikov.com/posts/industry-and-workers/ [2]: https://www.lesswrong.com/posts/R4djofDLGRsYx5wqf/industry-a...
When I heard "creators" I was worried this was some sort of platform where we had tiny aristocracy living off rents. But I gather it's turn-key software one runs on their website? That's great!
No platform means it's a lot harder to extort your customers. Meaning this is much more likely to be "the real deal".
https://capitalandgrowth.org/answers/Article/2987051/Candid-...
Sahil Lavingia is so much more respectful of creators than Jack Conte.
Also, Patreon is sorely lacking in utility for users, so many missed opportunities for social networking, functionality, and usability.
Everything I've ever read or seen by Sahil Lavingia has shown his dedication to fostering creatives.
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 )
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.
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?
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.
"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.
I like that. I'm not a fan of any IM system. I will use iMessage, from time to time, but it's usually email and Git Issues.
I use Slack as a "store and forward" system, like email; only checking it occasionally.
But I have the luxury of being the only tech person on one team; doing 100% of the coding, and being nothing more than a "hands off peanut gallery" on another. The designer for the first project uses Figma.
As with other gig economy jobs, it's sold by virtue of its "flexibility", but you can still offer flexibility and health insurance.
You can also pay for employee benefits, have them work fewer hours, have no meetings and no deadlines.
>“There's not a lot of room for growth. We're staying profitable, and not planning to double the team every year. While there will likely be a few leadership roles, there aren't plenty of them and they aren't built into the career path of working at Gumroad.”
Interesting how he equates growth with raising in hierarchy. I suppose if you're a programmer seeking to improve skills, sharpen your tools and increase knowledge, you're automatically a loser for many people.
His insights on how to live and work better and making me think if my little startup can follow some of these ideas.
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.
The article is a nice way of saying that the founder largely just collects rent while putting minimal resources into the business.
Are they banking ~$10M/yearly in profit and have 95%+ margins?
Hmmmm. Sounds weird that there were layoffs given that you could clearly afford to keep the employees? The company itself was raking in more each year.
I also find that in various development project I do people mater just more than the frame.
Because I was burned out and didn’t want to think about working any more than I needed to, I instituted a no-meeting, no-deadline culture.
For me, it was no longer about growth at all costs, but “freedom at all costs.”
This way, Gumroad stayed profitable, I could take a much-needed break to explore my hobbies, and the product continued to improve over time."
[...]
>"Today, working at Gumroad resembles working on an open source project like Rails. Except it’s neither open source, nor unpaid.
Instead of having meetings, people “talk” to each other via GitHub, Notion, and (occasionally) Slack, expecting responses within 24 hours. Because there are no standups or “syncs” and some projects can involve expensive feedback loops to collaborate, working this way requires clear and thoughtful communication.
Everyone writes well, and writes a lot.
There are no deadlines either. We ship incrementally, and launch things whenever the stuff in development is better than what’s currently in production. The occasional exception does exist, such as a tax deadline, but as a rule, I try not to tell anyone what to do or how fast to do it. 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.
But we don’t prioritize ruthlessly.
People can work on what’s fun or rely on their intuition, because as long as we remain profitable and keep shipping, we tend to get to the important stuff eventually. Our public roadmap helps Gumroad's creators hold us accountable."
Of course it isn't for everyone. But I bet that most "online" companies should learn a thing or two from Gumroad.
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.
I also run a successful zero FTE company and I wouldn’t trade it for anything.
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.
Problem is - it doesn't work in the long term. It can work for a while, until your money runs out or someone more competitive comes along and blows you away.
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.
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.
It seems to me that company operates like Uber or Lyft, and their product is exploiting wage inequalities.
Income Proof: https://www.dropbox.com/s/wzatabooj5hocug/Screen%20Shot%2020...
Here is a small sample of things of interest to an HN audience that you can buy with Gumroad:
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%...
> 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.