In which I examine the different places where you can get advice about culture, and how they compare. Note to self: be more upbeat/energetic. May involve additional coffee, or perhaps transcranial Direct Current Stimulation.
What does work/life balance mean to you? Most likely, it means something different to what it means to me.
There are many ways to define work and life, and the balance between the two, but I’m going to focus on two, that I’ll label, ungenerously to one of them, the “old way” and the “new way”1.
In the old way, work and life are clearly distinct, as night and day. Work is a curse (sometimes biblical), the time you spend toiling and sweating and bleeding to earn a living, and life is a blessing, the thing you work for, which must be distinct from work and much better than work, to justify all the toiling and sweating and bleeding.
You work (an activity that by definition you do not enjoy most of the time) to earn money, that you then spend on things that you do enjoy, during your “life” time. The work is an unfortunate necessity, something that you would avoid if you could. The ideal life is the infinite holiday. If you had millions of dollars instead of thousands, in this mental framework, you would probably go on an extended holiday, until you’re either ruined by unfortunate circumstances or you die.
This is still the dominant paradigm, and one that drives most of our discussions of work/life balance. In fact, the very term “work/life balance” implies belief in this old way of defining work and life. Whenever you say “work/life balance”, you imply to your subconscious that you believe in these two concepts of work and life and their contrast and the need to balance them.
How to balance them? Well, with the definition of work as something unpleasant and life as something pleasant, obviously work should be minimised and life maximised. So we have fixed working hours, 40 hours a week, then 35, then 30. We scrupulously “leave our work behind” when we go home. We take holidays where we make sure to disconnect. We look at people who work longer hours, take their work home and work on holiday as workaholics – a clearly, obviously pejorative term. Something to be avoided.
The new way of talking about work and life is from the point of view of passionate people doing work they care about deeply. The traditional view here is that only artists and vocational people like charity workers, priests or doctors can do that, but today’s reality is that many people engaged in a wide range of jobs can and do feel passionate about their work, and find personal accomplishment and fulfilment in them.
One obvious case of the passionate worker is the entrepreneur, but they are rare so let’s leave them aside. Another is people who work in open cultures, or at least in jobs that somehow have some mysterious characteristics like a sense of purpose and challenge and autonomy.
People in these kinds of jobs can frequently feel they are in an awkward place, because they feel that they enjoy working hard, but then the “old way” of thinking tells them that they’re working too hard. Adopting the language of the old way, they might end up “realising” that they’re workaholics and try to cut back, or go on holiday and deliberately disconnect from everything to try and recover some “work/life balance”.
The sad thing about this is that it is wrong and actually makes the passionate person’s life worse, not better. Being passionate about your work is not a curse, it’s a blessing. We can argue all year long about what the meaning of life is, and each person can and needs to come up with their own answer, but there is no argument that achieving a state of flow is a desirable thing. Being passionate about your work leads to being in a state of flow more often.
How tragic, then, when definitions imagined by people who worked in a state of pain rise up out of your subconscious to say, effectively, “hey, you shouldn’t spend that much time in a state of flow, you’re a workaholic with no work/life balance!” An exaggerated view of that is akin to interrupting Leonardo in the middle of painting the Mona Lisa to tell him he’s done his eight hours and needs to go home now.2
This conflict between working according to the new way but letting your thinking err along the old way is not helpful, and in my opinion should be avoided. I propose a new way of thinking about work/life balance, in terms of stages of work, with a clear, opinionated scale from worse to better. Each stage has different ways of thinking about work/life balance.
On the bottom of the ladder, I would like to put slavery – by which I do not mean wage slavery, but actual, real slavery. There is still an awful lot of this in the world. Some countries still have institutionalised slavery, and some high-profile international organisations do not bat an eyelid at using slavery to serve their goals, and most of humanity through most of history has operated at this level, sadly. As a slave with no control over your life, we can perhaps miraculously lift ourselves up to a higher level (like Joseph in the Biblical story), but most, by far, will not. The concept of work/life balance is irrelevant here: we have no life as a slave, our life belongs to our master.
One level above, I would put the type of work that one does to ensure survival (of oneself or of one’s family). Throughout the industrial revolution, and still in many countries in Asia in industries such as textiles or manufacturing, much of the work is at this level. This is barely above slavery, the only difference being that we have a notional choice of working under equally bad conditions somewhere else. Work/life balance as a concept becomes theoretically important but is mostly out of our reach. We work (serve the curse) as much as we humanly can, and the rest of the time is a temporary interval between stretches of work. Much of the social progress of the industrial revolution was aimed at allowing people working at this level to live humane lives, and lifted much of the western world’s population to at least level 3.
This is the level where the concept of work/life balance really has full meaning, and where most people are operating. In this perspective, work is undesirable but not oppressive. We have choice, so long as the economy is doing alright and our skills are in demand. We can choose to work reasonable working hours. We have control over the line between work and life. This is the old way done right. In this context, the concept of work/life balance is a good thing and it is important to balance the two, to stay in control of where that line shifts.
Some fortunate people operating at level 3 may find that some aspects of their jobs are more engaging than others, and get caught up in those aspects from time to time. Another way to put it is that we may have work that is largely undesirable, that would not be worth doing if we weren’t paid for it, but there are some aspects of that work that put us in a state of flow, where we lose track of time and find ourselves working till silly hours or thinking about work on holiday, etc. This is where the level 3 way of thinking holds us back, by suggesting that this is a symptom of an out of control work/life balance. At this stage, the concept of work/life balance still makes sense overall, but it starts to lose its usefulness, and I think this is the stage where we must be careful not to let it hold us back from progressing to level 5.
Because at level 4, we start to get a glimpse of what life could be at level 5, since we begin to find out which activities are both productive (i.e. things society rewards with money) and put us in a state of flow (i.e. things we deeply enjoy doing for their own sake).
Once we discover which activities we can do, which put us in a state of flow but are rewarded by society (i.e. are paid well enough), we have the option to start rebuilding our work (or finding another job or career) where we can spend most of our time doing the things we love and are passionate about. Of course, there are always going to be some unpleasant bits to any job, but because we see the bigger picture of what we’re doing (flow is impossible without a sense of purpose), we handle them without much effort, to get back to the bits we enjoy.
At this level, work/life balance makes no sense whatsoever. You wouldn’t put a time limit on flow any more than you’d put a time limit on any other enjoyable activity. Keep doing it as long as it’s fun! When it’s no longer fun, switch to another fun and productive thing. And so on, endlessly.
I don’t think it is possible to reach this level without letting go of the concept of work opposed to life, prevalent in level 3 thinking. A career/life where you spend most of your time in a state of flow is highly desirable, but it is not one we can reach while we meter out our efforts and keep thinking of work as something to be avoided.
A symptom of this state, in my opinion, is that we are constantly working: at home, during hobbies, on holiday, even while asleep! But much of that work is subconscious, thinking about how to do things even better or which things to do, rather than sitting down in front of a computer and “working”. The work is then just the natural outlet of the thinking, much like an artist’s work.
Whilst the shift from level 3 to 4 can happen accidentally without intention, the shift to level 5 only occurs if we really seek out this new way of working, which is why it’s important to embrace it rather than fight it.
There are a million objections to the ideas above. Some obvious ones are “what about if I have children?” or “what if my job sucks? no one could possibly enjoy my job!”. I believe that a careful reading of the article combined with some thinking will present answers to those objections though. Have a think before you disagree.
Life and work need not and should not be in opposition. When they are in harmony, both get better. But if you let the oppositional thinking of work vs life drive your thinking, it will impair your ability to progress from level 3 to level 5.
Don’t let old assumptions determine how you live your life today. Think for yourself about what makes sense for you.
Obviously, this is an artificial dichotomy and there is a whole continuum of definitions between the two, and there are of course other dimensions to the definition that I’m not exploring here! But for the sake of argument…↩
Another historical distortion is the concept that to matter in this way, work must be of great cultural or societal import. Actually, to put you in that same state of flow, work must simply matter greatly to you personally.↩
The book mentioned in this episode is:
Some books mentioned on this videocast:
Note to self: next time have an umbrella, and pay better attention to the framing! On the good side, I now have some lovely shots of my chin, and a wonderful rain-halo effect going as well.
For this second instalment, I explain why I believe in open cultures. It turns out that rather than simply being insane, I actually have a rationale for this belief. Three reasons, in fact.
Sorry about the volume – it’s a bit loud! Will try and put the mic slightly further next time.
So I thought I might have a go at recording a kind of videocast on my way to work. Let’s call it “On my way to work”, for now1.
The production quality is obviously fairly awful, though the lapel mic seems to be doing a relatively decent job considering the enormous amounts of noise on my current route to work2.
Anyway, the point of this is just to share some thoughts about GrantTree‘s open culture, including features like respect for people and the advice process (and perhaps other topics of interest, like investing), but perhaps in less detail (due to the extreme time constrains: a few minutes a pop). That’s right: with this videocast, you can rely on the broadcast being very short, since I’m lucky enough to live not all that far from work! Let’s see how it goes.
So this is the first one! Enjoy!
If you have any comments and/or thoughts, feel free to let me know by email, on Twitter, or even (shock, horror) in the Youtube comments…
One of the immediately interesting ideas I picked up from Reinventing Organizations (and since have discovered in other places, like Joy at Work) is the “Advice Process”. This is a decision model that works very well to replace both the top-down decision model and the consensus-based decision model, both of which have serious flaws in practice and theory both.
So far, we’ve been using the Advice Process at GrantTree for about 3 months now (since August 2014, in case you’re reading this much later), and it’s worked well (with some hiccups around decisions about pay – more on this further down). We’ve learned a few things about how to use it or fail to use it properly, and I thought I’d share these thoughts, three months in. First, though, a bit of background…
The advice process is a natural progression from the other two obvious decision models in startups. The default is the top-down model. It’s the dominant decision model in business today and most startups will default towards this unless the subject is given some thought. It can certainly work, and does in fact work for many large companies, but I believe it is inferior to both the consensus model and the advice model.
In the top-down model, decisions are ultimately made at the top of the company (e.g. by the founders and chief executives). Often, a single person has ultimate power to make every decision, and uses it regularly. By default, every important decision must rise to the top. Some less important decisions are delegated, but generally people avoid making decisions without their boss’s approval because they frequently don’t have enough information to make those decisions. This is very typical of closed cultures where secrecy is the norm – and is in fact the only decision model that can work there, since the lack of information sharing makes it a self-fulfilling prophecy that the lower strata simply cannot make the big, important decisions.
Some people are happy with that. Others really hate it. Some, like Tony Hsieh, will rather sell their company than continue working there once they’ve built this sort of culture1. The natural reaction is to say “rather than concentrate all the decision making at the top, let’s distribute decision power; everyone should have a say!” Enter the consensus model.
In the consensus model, everyone agrees before a decision is made. I believe this model is superior to the top-down model, for the simple reason that it engages everyone. It may be less efficient at making decisions, but as part of a culture of involving everyone in running the company (which requires a lot of transparency) it results in far more motivated people and therefore, in my opinion, it is better than the top-down process despite its flaws. What are its flaws? Well, it’s very slow, first of all – getting everyone to agree takes time. It’s also prone to politics – people spending energy building support for their proposals rather than getting things done.
One way to see the consensus model’s failure is that instead of giving everyone the power to make decisions (its intended aim) it gives everyone the power to stop everyone else from making decisions. Ouch.
Enter the advice process.
Here is the way we defined the advice process within GrantTree:
Anyone can make any decision they feel comfortable making. However, before they make that decision, they must ask those who will be impacted by that decision, and those who are experts on that subject, for advice. They are free to disregard the advice and make the decision the way they wanted to anyway, but they must first ask for advice.
Important: this is about getting feedback/input into your decision, not about building consensus. Do not use the advice process to try and browbeat people into agreement or to build political support for your decision. You don’t need people to agree. You don’t need political support. You just need input to make sure that you make the right decision.
It seems very obvious and elegant in retrospect, and it’s no surprise that many advanced open cultures have evolved similar decision processes in parallel. Lucky for us building companies in 2014, we don’t have to reinvent the wheel: we can just read books and blog posts about it and copy the best ideas!
The core is so simple: if you want to empower people to make decisions, let them make decisions. Boom.
However, in practice, there can be a few snags in the way you implement the advice process. I’ve noticed some, and they are outlined below. Hopefully they’ll help some people.
First of all, in order to work, the advice process must be brought in for the right reasons: i.e., it must be about enabling everyone in the company to make decisions. I’ve observed a case where a partner in a small firm brought in the advice process in order to justify making a decision which everyone else disagreed with. That’s not going to work.
Bring the advice process in to enable people who are already working well together to do so faster. If the consensus process is failing you because there are too many disagreements within the company, the advice process will only cause people to get even more pissed off at each other. Think of the advice process as a speed boost. If you were heading for a wall, you will only smash into it faster.
We trialled this, and whilst I fundamentally believe it can work2, there are a few important caveats which are particularly relevant to startups.
The advice process risks causing conflict when a highly contentious issue is being decided, one where there is very strong, irreconciliable disagreement. For example, if people have taken comparatively low pay because they were joining a startup, and they feel they are significantly underpaid, then allowing them to change their pay via the advice process will set them on a collision course with others who disagree that the company is at a stage where it can afford to pay a market rate, there will be sparks. In theory, the advice process should be able to resolve this… but it is a bit of a test of fire. And most companies don’t have time for that level of conflict.
I would recommend not applying the advice process to compensation until it is generally accepted that most people are paid mostly the right amount, and that there won’t be any proposals to double someone’s salary. At the very least, if you’re going to open that up to the advice process, do it a good many months into the process, at a point where both the advice process and the conflict resolution process (to be discussed in another article) are well bedded in, so this one conflict doesn’t sink the entire advice process endeavour.
As a founder, the hardest thing about the advice process is actually in clearly resolving, within yourself, to actually trust the people you’re delegating that power to.
People can feel if you’re only paying lip service to the advice process, doing it to “empower” people but not actually trusting them with important decisions. When you don’t really trust people, you will end up verifying and vetoing and changing their decisions after the fact. This creates a self-fulfilling prophecy (a perverse version of the Pygmalion Effect). Because people know they’re not really making the decision, they don’t pay attention to it all that much. They’re playing with a safety net, and that safety net is you, the founder. So they make whatever decision they feel like, without thinking too much about it, and let you take responsibility for which decision actually gets implemented.
Needless to say, that doesn’t work. The magic of the advice process is that the person making the decision is entirely responsible for the decision and its outcome. This concentrates the mind, and forces them to really seek out advice and pay attention to it, because ultimately it’s their decision and the company (which hopefully includes people they like to get on with) will have to live with the consequences of that decision.
When people make a decision via the advice process, let them actually make the decision. Trust them. That’s certainly the hardest part of the process as a founder.
Sometimes, nevertheless, there will be decisions that lead to a conflict. To resolve this, you need a well defined conflict resolution process. I’ll cover that in more detail in another post, but here’s an essential point to make here: let the conflict happen (so long as you have a clear process for dealing with it). In particular, don’t try and resolve the conflict ahead of time by undermining the decision process before the decision has even been made. Otherwise, you’re once again taking away responsibility from the person making the decision.
I made an exception at GrantTree for a salary decision conflict that seemed unresolvable – both sides were completely unwilling to budge and, knowing the people involved, I knew they were stubborn enough to drag it out all the way. I’m not yet sure suspending the advice process for compensation was the right decision (time will tell), but what I am sure is that if I suspend the advice process again, people will get the impression that the advice process is only there for unimportant decisions – and that will undermine it, lead to a self-fulfilling prophecy, etc.
Finally, not every company is ready for this process. In particular, the advice process requires:
I hope some people who are currently mired in the consensus process read this and find the solution they were looking for. If you have any questions about how that might work, feel free to ask them (email, twitter or otherwise). I’ll do my best to answer.
And, according to Dennis Bakke, it has actually worked in some parts of his company, AES back in the nineties.↩
Can you skip directly from top-down to advice? Maybe… let me know if you’ve done that! Intuitively, though, I think the evolution might be necessary.↩
I guess it had to happen sometime! My first investment, made a month or two ago but kept quiet until now, is SolidLabs, makers of the Primo Playset that had a successful Kickstarter last year. It’s an absolutely awesome project to teach programming to pre-literacy kids via an arduino-based device. Watch the video, it’s really excellent. So I invested in them.1
It’s been interesting and very instructive to find myself on the other side of the figurative table. Except I’m not on the other side. I’m an entrepreneur, running a business that, who knows, may itself take funding at some point. I’m investing largely because I’m lucky enough to be able to, and because I’ve always had a desire to move towards that.
However, there are some interesting lessons at the moment, worth making notes on, if only so I can look back at them later, but also so that they might be helpful to others…
Perhaps because I’ve been bathed in the startup world for almost a decade now (since 2007 – almost 8 years), I am (perhaps naively, we’ll see) not that bothered about the valuation. It shouldn’t be something unreasonable, but then that is usually determined by the amount of equity being raised. Every round, from seed to series whatever, should be somewhere between 10% and 30% or thereabouts.
Why am I not bothered about the valuation? Because I understand that many if not most of those businesses will go bust and return nothing, and those that do succeed will hopefully return a sufficient multiple that the initial valuation shouldn’t be a huge factor in there. I am also counting on the fact that other investors, who are putting in more money than me, are investing on a sensible valuation, and I’m investing along with them, so benefitting from their efforts at coming up with a sensible valuation.
Ultimately, I don’t care that much if the investments that work out give a 30x multiple or a 20x multiple, so long as it’s in the tens.
I also don’t care what percentage I end up owning. That’s not what matters for an investment. What I care about is that if I put £10k in, I get a multiple of that out. Whether I turn my £10k into £50k by owning 0.001% or 10% makes little difference. What makes much more difference is how much the business grows.
One thing I have learned from reading countless articles about investor flaws is not to do the classic thing of dragging out a potential investment for weeks or months. I make up my mind quickly. Investing is not all that far from educated gambling, after all. I draw on my years of experience as an entrepreneur in the startup scene to make a snap judgement, and then do some background research to make sure I’m not being scammed.
I have a budget of a few tens of thousands of pounds to invest each year, that I’ve split into £10k packets which I’m investing in different businesses. I know I’ll lose a lot of it, but the “learning” is hopefully spread and there will perhaps be a winner or two in the lot!
I won’t invest in a field that I know nothing at all about, but “tech startups” covers a fairly broad range of topics. This enables me to make these decisions snappy. If I can’t make a decision quickly, I won’t invest.
Obviously that’s not going to be the case for all of my investments, but where available, insider information is great to have. For example, SolidLabs was also one of GrantTree‘s clients. We wrote about their technology and their business extensively. We know them, over a period of time.
Insider trading is illegal when it comes to public corporations, but it’s perfectly legal when it comes to private investments. In fact, if you’re smart, you’ll want as much insider info as possible, and working directly with a company is the best way to get that.2
I won’t say that working with GrantTree will automatically lead to an investment. It obviously won’t. I also won’t say that it is required for an investment. It probably isn’t (the second investment I’m currently looking at is not a current client). But it sure helps!
I’ve wanted to invest in startups for quite a while, but if I look at the most immediate cause for my investments? The UK tax breaks are just too good.
Get this: with SEIS investments, I get 50% of the invested amount deducted from my income tax liabilities for the year. This means I can pay myself more without paying income tax (I don’t like income tax; do you?). Effectively, my investment is half price, upfront.
That’s not all – if, god forbid, the investment goes sour, I will get a further chunk of tax deductions at that point. It can work out as well as £7.5k of tax breaks for a £10k investment. That means my £10k packet only risks £2.5k, effectively.
Can you beat that? Yes you can. After all this, SEIS also makes the gains capital gains tax-free. So if the investment doesn’t turn sour, and in fact returns, say, a 10x multiple on that £10k, I will get £100k back, tax-free.
That’s tax incentives. And then there’s the government support the UK gives to the companies themselves. With tax credits, the money spent on R&D goes 33% further. So this £2.5k I’ve risked can enable up to £13.3k of investment. Even better if the startup gets a grant, which can be 45-60% match funded. In that case, a £10k investment could net £18.2k of spend, or even up to £25k of effective spend.
So, I risk £2.5k, and the UK government can fill in up to 10x that amount, in the optimal case. Blimey, as they say in the UK.
I guess I’ll carry on and see what happens. Where possible, I’ll mention my investments here.