Compared with many startups, 37signals cofounder Jason Fried’s views around workplace culture, structure, and strategy could be considered subversive. He’d call them “honest,” a word he uses often when describing his leadership style. The outspoken maker of Basecamp and HEY has cultivated a reputation as a tech industry contrarian over the past two decades with his “in-the-moment” approach to company management and his commitment to profitability over growth. (“Growth at all costs is an anathema to us,” he says.) Over the years, some of his stances have earned praise — a shunning of overtime and an embrace of the four-day workweek, for example. Others, like his aversion to targeted advertising (“ethically wrong”) and his decision to deter political talk at work, have prompted raised eyebrows and Twitter pile-ons.
Fried talked to Future about his conviction in short-term thinking, his framework for startup longevity, and the number one thing he looks for when recruiting and hiring remote workers.
FUTURE: There’s a certain looseness to your leadership style: You don’t make long-term plans. You don’t make to-do lists. You tend to make decisions in the moment and figure things out as you go. What are some common misconceptions people have around that strategy?
JASON FRIED: People think it’s irresponsible or that it’s lazy. “How can you run a business without planning a year, three years, five years in advance? “How is anyone going to know what to do if you don’t lay it all out clearly for them?” I’m here to tell you it’s absolutely possible to run a business this way, and in fact I think it’s desirable.
Why? What makes a short-term business strategy smart?
It feels like a much more responsible way to run a company than to imagine that I’m going to know what the next three years will look like. Humans are terrible estimators. We’re terrible at figuring out what the future’s going to be. So why set yourself up against that?
What’s important to me is being able to reconsider current context frequently. I’d rather look around more frequently, set short-term directions, and then re-evaluate. Because then you don’t really get off track. You don’t get mired down in something you don’t want to do. You don’t get stuck doing things that weren’t worth doing in the first place.
I kind of run the company like a squirrel runs on the ground. It runs, it stops, it looks around. It’s trying to get to that tree over there, but it doesn’t go straight to the tree. It makes its way there and it adjusts its course based on what it’s in front of it. That, to me, is the healthy way to get from here to there. It’s an honest way to manage a company and it’s more in line with human nature.
So what does that look like in practice, in day-to-day work?
Every six weeks, we define three or four projects we’re going to get done in product development. The max we’re willing to spend on any given feature is six weeks. We work in teams of two — one designer and one programmer — and that team has all the agency to build what they want to build in anywhere from one to six weeks.
It’s like if you were to go to Vegas and gamble. You go to the ATM, you take $500 out, and if you’re disciplined, you go, “The most I’m willing to lose is 500 bucks. After that, I’m done.” But if you’re not disciplined, you go back to the ATM and get another 500 bucks out. That’s how most companies run. They keep going, they keep missing deadlines, they keep spending more money, they keep pouring more time into things.
We’re the other way around. We take the money out and we go: that’s it. And that’s the advantage of these shorter time horizons: It forces us to be creative, to be economical, and to be thoughtful about what we’re doing and not just feel like there’s unlimited time and money to get to it eventually.
With these three-week or six-week goals, how do you help people coalesce around a sense of purpose?
We set what’s called an appetite up front: This piece, this project, or this idea, we’re willing to spend one week or three weeks or six weeks on. And then the teams run with that. Every team has its own set of things it’s trying to do, and it knows what it needs to do. It’s in service of the whole thing, but not simultaneously in service of the same thing.
Why limit teams to just two people?
That’s enough, that’s why. One programmer, one designer. Every additional person beyond that, I think things get exponentially more complicated. We don’t have project managers.
When you have two people, there’s direct communication, they can talk to each other. Three people don’t really talk, they have a conversation. Four or five people, they have a meeting. It just becomes more complicated to keep everybody in the loop. The more people involved, the slower it actually goes. It’s just simpler to say: two people. We have to hire really excellent people to pull this off, of course.
Is that flexibility around shorter-term goals and figuring things out on the fly something you hire for, then? How do you gauge someone’s comfort level or a skill level with that style of working?
We try to find people who we call “managers of one,” in that they should be self-motivated, self-driven, self-directed. They should be willing and interested and curious to figure things out on their own, to not feel like they always need to go ask other people what to do or how to do things. You want to find people who thrive as problem solvers, as independent minds.
We’ve hired people in the past who came from a work culture where their manager would prepare a list of things for them to do every morning. And it turned out that’s just not the right fit for us. There is no list of work; you make up your own work. You know what the project is that you’re on, but it’s up to you to figure out how to get it done and what it needs to do. All those things are up to you.
And so you need to find people who are comfortable with that level of autonomy — almost like they’re building their own thing.
How do you optimize for that in the hiring process?
Writing is the number one thing we look at for every position. The cover letter is where it all begins for us. Can this person communicate clearly? How do they describe themselves? How do they describe their desire for the job? We only hire great writers, because the majority of our communication is written. When you hire great writers, you tend to get pretty clear thinkers.
It’s one thing to write a cover letter. But for better or worse, many people are often more likely to express themselves at work in an off-the-cuff meeting than if they’re asked to write out their thought process behind some idea or decision. Do you have tips for encouraging better written communication in a work context? Are there particular strategies you employ to make sure writing is effective, rather a roadblock to new ideas?
It could be a roadblock to ideas, but I think that’s actually a good trade-off. You’ve got to be able to fully form your thoughts, you’ve got to put them down in a narrative style that other people can understand. You can’t just drive by and throw an idea here or there. There are unlimited ideas. So we want the ones that people are willing to make an effort, they really believe in, and they’re going to need to do some work to explain.
This is not about writing an essay that’s multiple pages. We don’t use Google Docs. A few paragraphs is enough, a sketch or two included in that few paragraphs is even better. What you want to see is the shape of the idea, some thinking about how it could work.
Writing is a nice equalizer. You can take your time, you’re not on stage. You hit publish when you’re ready.
In the past, you’ve advocated for building something useful above things that are fun or cool. Startups are often founded in pursuit of discovering the next big thing or capturing a certain something in the zeitgeist. What’s behind your philosophy?
I think you can spend a lot of energy on chasing trends, versus if you know what you’re doing, you focus on things that matter. You know your customer base well. You know your product really well. You use the thing you’re building. You actually know it’s useful, you don’t have to guess about what people want.
We’re not looking to compete, we’re not looking to outspend, we’re not looking to dominate. The market is enormous, and there’s plenty of room for lots and lots of companies to do well. So for us it’s about: what do we need to do to build the kind of business we want to build?
On that note, you’ve mentioned that you don’t necessarily want to be a huge, billion-dollar corporation. If it’s not measured in terms of growth, then as a company and as a leader, how do you define success?
Broadly, by: Do I want to do this again? Do I want to keep doing what we’re doing?
We enjoy building things. We enjoy coming up with new ideas. We enjoy poking the industry. We enjoy showing people that there’s a different way to work. We enjoy pushing against the norm. That’s all enjoyable, and one of the beauties of being profitable is that you kind of buy yourself all the time in the world to do the things that you want to do. I think we’re very much an in-the-moment company.
That “in the moment” philosophy includes a lot of experiments, right? One better-known example is when you adopted the four-day work week. Are there more recent experiments with outcomes that surprised you?
I think the thing that happened last year, which is when we decided that we’re not going to be talking politics at work. It was quite controversial and kind of blew up, but we’re still very comfortable with the decision. We’d make the same one again.
It was an experiment. We didn’t know how it was going to turn out. We thought there could be some significant negative consequences. We didn’t know if it would hurt or help recruiting. We didn’t know who would stay and who would go. It was an existential experiment. It was: This could end everything, or it could be a reboot. We didn’t really know.
But David and I had talked about it at length. And one of the things we tend to do a lot of is negative visualization, which is: in any decision we make, what’s the worst that could happen? And the worst that could have happened there would have been we could have gone out of business. Let’s say everyone left or business was crushed or something like that. That would have been the worst thing that could have happened, which would have been terrible.
But also, we had been in business at that point for 22 years. That’s a pretty amazing run. And if it ended that way, so be it.
Yeah. We’d all be okay. Everyone who works here would be able to get a great job somewhere else. It would be okay. This is not the only reason why we live.
Now, we didn’t think that would happen. But if it did, we still would have done it. That was what we decided. That gave us a large degree of confidence to make the decision we made.
From the outside, that seems like an example of an experiment that, at least initially, went worse than you expected. True? In those cases, do you adjust?
In terms of people leaving — and in terms of the Twittersphere sort of erupting — yes. But I can tell you now that it’s one of the best decisions we ever made in the history of the company.
Why is that?
Because we’re really focused now. People who are here really, really want to be here. We’ve had no problem attracting incredibly great talent since then. We’re bigger than we’ve ever been now. We’re able to do more than we’ve ever been able to do before. And there’s no distractions that were really kind of souring the interactions between people. It didn’t feel great to be at work. There were too many debates about things that didn’t actually matter to the work itself.
Most companies are dealing with this. I see lots of companies suffering through it. They don’t know what to do and they’re trying to toe the line. It’s incredibly hard to do. We’ve moved beyond that. It feels like an expansive place to be, not a compressed place to be anymore.
But yeah, we didn’t expect the media eruption. But we also realized that there’s the world on Twitter and then there’s the rest of the world, and the rest of the world is quite large and not interested in those kinds of things. And it turns out there’s a lot of people who actually agree with what you do, and they don’t live on Twitter. You can be scared of doing things because you’re afraid of the reaction there. But it’s really a relatively small universe of people who are just up in arms about pretty much everything.
Did that backlash affect how far you’re willing to go, whether in your own writing or how much you’re willing to poke the bear?
Temporarily, yeah. We used to tweet a lot and we don’t as much anymore. For a while, you just kind of tone it down because you’re injured, to some degree. You know, you sprain your ankle, you stay off it for a while. And then it heals, and you feel good. It was kind of like a major sprained ankle or broken bone for us. It took a while to heal.
It was a good number of months until we could sort of breathe again at a reasonable pace, and work again at a reasonable pace. For a while it was a pretty big distraction. We lost some key people, we had to replace them. We had to onboard people and get people up to speed and we had to make sure the business could sustain all that. And it did.
You mentioned you were still able to recruit, despite dealing with backlash. Basecamp was fully remote long before the pandemic, but in the past few years we’ve seen many more tech companies follow suit. How can newly remote companies better compete for talent?
We create a place people want to work at. People want to be able to do great work without being distracted all day long. People don’t want to work somewhere where they’re mired in meetings. People want to work around other smart people and they want to have a full eight-hour day to themselves to do that work and not feel like they have no time to do work at work. You create that environment and promote it well, explain it well, and live by it.
Yes, you can remote work at a lot of places now, and I’m so glad to see that, but at many of those places you’re stuck on Zoom all day, you’re stuck in meetings all day, you’re still putting in 70 hour weeks. All we expect from you is 40 hours a week. You get to have a lot of autonomy and control and agency over the work that you do. There are no shared calendars. People aren’t putting meetings in your schedule. And when you talk about an environment like that, people want to work there.
It’s interesting that working eight hours a day is considered—
—outside the norm.
Work dominates people’s lives in so many places and so many ways. Especially when they’re remote, it’s a lot easier [for companies] to ask people to work longer, work harder, and work on the weekends, because work and life are kind of the same thing.
Now you’re seeing some people recoiling against remote work. A lot of companies are pulling people back to the office, because their experience with remote work was not particularly good. But that’s because they thought remote work was just the same kind of work from far away.
Good remote work is a totally, entirely different way to work. It’s an asynchronous style of working, not real time. You don’t want to simulate what it’s like to be in-person when you work remotely. You want to go in the opposite direction of that.
I once heard you say that you’re a fan of myth-busting, and one was that the physical office is this magical place where creativity happens. Are there other commonly accepted beliefs within tech that you think deserve busting?
That you need a lot of people to build something great. You don’t. That, of course, adding more people to projects makes them go faster. It typically doesn’t. That eight hours a day isn’t enough. It is. That you need to put in nights and weekends. You don’t. That everything should be a video call. It shouldn’t.
And so, for people who will push back against remote work, saying it doesn’t work or you’re on Zoom all day or I saw Jamie Dimon come out and say it’s like management by Hollywood Squares…Yeah, you’re doing it wrong. A new myth that’s forming is that remote work was a temporary thing and it’s not really any good. And I just don’t believe that to be true.
I would also say it’s a myth that you need to know what you’re doing over the long-term. You need to know what you’re doing now. And a bunch of “nows” adds up over time, and you can stick around for a long, long time in this industry by figuring it out as you go.
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