Relative to many startups, 37signals cofounder Jason Fried’s ideas about workplace culture, organization, and strategy might be seen as subversive. He’d describe them as “honest,” a word he often uses when talking about his leadership style. The outspoken creator of Basecamp and HEY has built a reputation as a tech industry contrarian over the last two decades with his “in-the-moment” way of managing the company and his devotion to profitability over growth. (“Growth at all costs is an anathema to us,” he says.) Over time, some of his positions have been praised — for instance, rejecting overtime and embracing the four-day workweek. Others, such as his dislike of targeted advertising (“ethically wrong”) and his choice to discourage political conversation at work, have led to raised eyebrows and Twitter pile-ons.
In this interview, Fried discusses his belief in short-term thinking, his view on startup durability, and the top thing he seeks when recruiting and hiring remote workers.
The power of short-term thinking
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 seems like a far more responsible way to run a company than to assume I’m going to know what the next three years will be like. Humans are awful estimators. We’re awful at determining what the future is going to be. So why put yourself in opposition to that?
What matters to me is being able to rethink the present context often. I’d rather check in more frequently, choose short-term directions, and then reassess. Because then you don’t really drift off course. You don’t get bogged down in something you don’t want to do. You don’t get trapped doing things that weren’t worth doing to begin with.
I sort of run the company the way a squirrel moves on the ground. It runs, it pauses, it looks around. It’s trying to get to that tree over there, but it doesn’t head straight for the tree. It works its way there and adjusts its path according to what’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 closer to human nature.
So what does that look like in practice, in day-to-day work?
Every six weeks, we identify three or four projects we’re going to finish in product development. The maximum we’re willing to spend on any one feature is six weeks. We work in pairs — one designer and one programmer — and that pair has complete latitude 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 do it the other way. We take the money out and we say: that’s it. And that’s the benefit of these shorter time horizons: It pushes us to be creative, to be efficient, and to be deliberate about what we’re doing and not simply assume there’s endless time and money to reach it someday.
With these three-week or six-week goals, how do you help people come together around a sense of purpose?
We set what’s called an appetite in advance: 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 serves the whole thing, but not at the same time in service of the same thing.
Why two-person teams are enough
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.
The draw of autonomy in the workplace
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.
So, for example, the designers we hire also write all their own HTML, they write their own CSS, they write most of their own JavaScript. We have very few silos. For the most part, these teams of two are autonomous, and you need to find people who are good at that.
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.
So you have to find people who are comfortable with that degree of autonomy—almost as if they’re building something of their own.
How do you optimize for that during the hiring process?
Writing is the first thing we examine for every role. The cover letter is where it starts for us. Can this person communicate clearly? How do they present themselves? How do they explain their interest in the role? We only hire excellent writers, because most of our communication is written. When you hire excellent writers, you usually get pretty clear thinkers in practice.
Why written communication beats brainstorm meetings
It’s one thing to write a cover letter. But for better or worse, many people are usually more comfortable speaking spontaneously in a meeting at work than when they’re asked to put their reasoning for an idea or decision into writing. Do you have advice for promoting stronger written communication in a workplace setting? Are there specific tactics you use to ensure writing is useful rather than a barrier to new ideas in day-to-day work overall?
It can block ideas, but I think that’s actually a worthwhile trade-off. You have to fully shape your thoughts, and you have to set them down in a narrative form other people can follow. You can’t just cruise by and toss an idea here or there. There are endless ideas. So we want the ones people are prepared to work for, the ones they really believe in, and the ones they’ll have to explain with some effort before we decide they’re worth pursuing at all.
This isn’t about producing a multi-page essay. We don’t use Google Docs. A couple of paragraphs is enough, and a sketch or two inside those paragraphs is even better. What you want to see is the shape of the idea, and some thought about how it might work in practice.
Writing is a nice equalizer. You can take your time, you’re not on stage. You publish only when completely ready.
In the past, you’ve argued for making something useful instead of something fun or cool. Startups are often built to discover the next big thing or capture a certain something in the zeitgeist. What sits behind that philosophy at root?
I think you can spend a lot of energy chasing trends, whereas if you know what you’re doing, you concentrate on what matters. You know your customer base well. You know your product really well. You use what you’re building. You actually know it’s useful, so you don’t have to speculate about what people want for certain.
We’re not trying to compete, we’re not trying to outspend, and we’re not trying to dominate. The market is huge, and there’s plenty of room for many, many companies to do well. So for us it comes down to: what do we need to do to build the business we want to build together?
His framework for success
More broadly: Do I want to do this again? Do I want to keep doing what we’re doing? That’s my definition as a company and as a leader if growth is not the measure, for success to me overall.
Broadly, by: Do I want to do this again? Do I want to keep doing what we’re doing?
We like building things. We like coming up with new ideas. We like needling the industry. We like showing people there’s another way to work. We like pushing back against the norm. All of that is fun, and one of the advantages of being profitable is that it basically buys you all the time in the world to do the things you want to do. I think we’re very much a company that lives in the moment.
Experiments: No political talk at work
That “in the moment” outlook includes a lot of experiments, right? One better-known example is when you moved to a four-day work week. Are there more recent experiments whose outcomes surprised you at all?
I think the thing that happened last year was when we decided we weren’t going to talk politics at work. It was pretty controversial and kind of blew up, but we’re still very comfortable with the choice. We’d make the same call again if asked today.
It was an experiment. We didn’t know how it would turn out. We thought there might be some major negative effects. We didn’t know whether it would hurt recruiting or help it. We didn’t know who would stay and who would leave. It was an existential experiment. It was: this could end everything, or it could be a reset. We really didn’t know either.
But David and I had talked about it at length. And one thing we do a lot 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 that 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 for us as well.
But we’d been in business for 22 years by then. That’s a pretty remarkable stretch. And if it ended that way, so be it for us all.
Really?
Yeah. We’d all be fine. Everyone who works here could get a great job somewhere else. It would be fine. This is not the only reason we live on earth anyway.
Now, we didn’t think that would happen. But if it had, we still would have done it. That was the decision we made. That gave us a great deal of confidence to make it ourselves again.
From the outside, that looks like a case of an experiment that, at least at first, went more badly than you anticipated. Right? In those situations, do you make changes?
In terms of people departing — and in terms of the Twittersphere kind of blowing up — yes. But I can tell you now that it’s one of the best decisions we ever made in the company’s history.
Why?
Because we’re truly focused now. The people who are here really, really want to be here. We’ve had no trouble drawing unbelievably strong talent since then. We’re larger than we’ve ever been now. We’re able to do more than we’ve ever been able to do before. And there are no distractions that were really kind of poisoning the relationships between people. It didn’t feel good to be at work. There were too many arguments about things that didn’t actually matter to the work itself.
A lot of companies are wrestling with this. I see plenty of companies going through it painfully. They don’t know what to do and they’re trying to walk the line. It’s extremely difficult to do. We’ve gotten past that. It feels like an expansive place to be, not a cramped place to be anymore.
But yes, we didn’t anticipate the media flare-up. But we also came to understand that there’s the world on Twitter and then there’s everyone else, and everyone else is very large and not interested in those sorts of things. And it turns out there are lots of people who actually agree with what you do, and they don’t live on Twitter. You can be afraid to do things because you’re worried about the reaction there. But it’s really a comparatively small universe of people who are just outraged by almost everything.
Did that backlash change how far you’re willing to push, whether in your own writing or in how much you’re willing to prod the bear?
Temporarily, yes. We used to tweet a lot and we don’t as much anymore. For a while, you just sort of dial it back because you’re hurt, to some extent. You know, you twist your ankle, you stay off it for a while. And then it mends, and you feel fine. It was sort of like a major sprained ankle or broken bone for us. It took a while to recover.
It took quite a few months before we could kind of breathe again at a normal pace, and work again at a normal pace. For a while it was a pretty significant distraction. We lost some important people, we had to replace them. We had to bring people on and get them up to speed and we had to make sure the business could absorb all of that. And it did.
How to recruit remote talent
You mentioned you were still able to recruit, even while dealing with backlash. Basecamp was fully remote long before the pandemic, but over the last few years we’ve seen many more tech companies do the same. How can newer remote companies compete better for talent?
We build a place people want to work. People want to be able to do great work without being interrupted all day long. People don’t want to work somewhere where they’re buried in meetings. People want to work alongside 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 build that environment and advertise it well, explain it well, and live by it.
Yes, you can work remotely at many places now, and I’m so glad to see that, but at a lot 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 ask of you is 40 hours a week. You get a lot of autonomy and control and agency over the work you do. There are no shared calendars. People aren’t putting meetings into 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—
A perk?
—outside the ordinary.
Work takes over people’s lives in so many places and so many ways. Especially when they’re remote, it’s much easier [for companies] to ask people to work longer, work harder, and work on the weekends, because work and life are sort of the same thing.
Now you’re seeing some people push back against remote work. A lot of companies are bringing people back to the office, because their remote-work experience was not especially good. But that’s because they assumed remote work was just the same kind of work from farther away.
Good remote work is a completely, wholly different way to work. It’s an asynchronous style of working, not real time. You don’t want to mimic what it’s like to be in person when you work remotely. You want to move in the opposite direction of that.
Debunking tech industry myths
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 widely accepted beliefs within tech that you think should be busted?
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 usually doesn’t. That eight hours a day isn’t enough. It is. That you need to work 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 taking shape 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 stay around for a very long time in this industry by figuring it out as you go.