We recently interviewed the CEO of TaxJar, Mark Faggiano, on our Outside the Valley podcast. In fact, he was our lucky first guest! (Scroll down halfway if you’d like to read the episode transcript in full.)
Mark had plenty of personal views on the subject of remote work. He’s been working, and leading, remotely since 2001, so he’s very experienced at how to collaborate effectively on a remote team.
In this post we’ll break down some of the main things we learned from Mark — and trust that these insights will help your own remote work practices. Let’s go!
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Remote Work > Commuting
Mark can’t stand the traditional way of working:
I’m not comfortable with the idea of getting into a car, having to wake up earlier than probably normal, getting into a car, sitting in a lot of traffic, and then going into a building. And that is supposed to dictate when I am going to be productive, right? That concept to me doesn’t make any sense.
Mark Faggiano, CEO of TaxJar
Results Matter Most for Remote Teams
In a remote team, the corporate idea of “face time” quickly becomes irrelevant. Like other high-performing remote-first companies, TaxJar is a results-oriented workplace:
…we all have a job to do. But it’s up to us to determine how we get that work done, and when we get that work done. The only stipulations that we have at TaxJar is that you’re doing your best work, and you’re doing it on time. Otherwise, we don’t care if you’re working all night or taking a two hour break to go to the gym or take care of your kids or whatever it is. That doesn’t matter to us. What matters most is the end result.
Onboarding is Everything
Until TaxJar hit over 20 employees, Mark did all the onboarding himself! However, as the company scaled, this was no longer possible. So one of the critical roles within TaxJar is their Employee Experience role:
What we noticed was that there was confusion around where do I go for basic things? How do I get signed up for this, that or the other thing? How do I get my questions answered? And those are things that should have been explained in a proper onboarding process. So that’s the point where I realized we need somebody to come in and be 100% focused and dedicated. And that was our first Employee Experience hire.
Only Great Teams Can Achieve Great Results
As a people-driven CEO, Mark places huge emphasis on the quality of his team:
It’s all about the team. That’s what matters the most. […] There’s a lot of things that we want to do, and there’s goals that we want to accomplish […] We can’t do that without the best team possible. That breaks down to every single hire has to be put in a position to succeed. You can’t do that without a really, really helpful and valuable onboarding process.
Yes, You Need an Organizational Chart
Sometimes formalizing things is helpful:
…the first time, I can remember it clearly when we said we need an org chart, and I went, “Oh, seriously? Do we need to do that?” But you have to get over that really quickly because the reality is, now you have a lot of new people, you have people that you don’t know. And the worst mistake you can make is they don’t understand where they fit into the organization, and where the opportunity is for them.
Developing Processes Might Be Painful, But Not Having Them is Worse
It’s fair to say that Mark doesn’t like developing processes. But as TaxJar grew, he came to understand that things had to change:
We’re still extremely fast and are able to do things super fast. But you do have to adjust as a CEO to realize, things are a little bit more complicated, and there needs to be processes developed. Otherwise, you go sideways, and that’s the most frustrating thing.
There’s no process. Everybody standing around waiting for somebody to make a decision. That’s death. You can’t let that happen. So, where it makes sense, get those processes…
Grow Big, But Think Like a Startup
Mark recommends retaining the ability to think like a startup, and not becoming too regimented:
What made us great, and what got us here, was the ability to think quickly, make decisions fast, and get to work. We don’t want to implement artificial bottlenecks just for the sake of having processes.
Creative Team Bonding Strategies
Bonding as a fully-remote team takes some work, so let’s lift the lid on some of the ways TaxJar does it:
- A cake-baking contest every “TaxJar Birthday”
- New team members sing or put on a show
- Monthly skill-sharing over a video call (a team member shares what they’re passionate about outside of work!)
- Friday FaceTime, where the new employee answers questions from the team for half an hour
TaxJar Blog = Recruiting Tool
Instead of spending time convincing people to apply for jobs at TaxJar, part of the company blog is designed to show people what it’s like to work there. Why? Because they try to be as transparent as possible.
…people were coming to the interview saying, “Hey, I read the entire Life Blog. I love what you’re all about. I want to work here.” That was really an amazing evolution for us. And to this day has continued to be super valuable. So, we believe in being as transparent as we possibly can, but the added benefit here is it’s been a tremendous value for our hiring process.
Not Everyone is a Customer
In a world full of consumer choice, TaxJar has some specific ideas about their customers:
Our job is not to win every single potential customer that exists in the world. Our job is to win the deals where our values, and the way that we do work, resonates with the customer. Those are customers that we want anyway, right?
Candidate Interviews Aren’t Everything
Leaders of remote teams put special emphasis on communication and collaboration. The only problem: it’s not always possible to test for this through traditional recruitment methods.
The resume tells us what we’re looking for. But at the end of the day, we don’t really know if they can do the work, and we don’t know if they can work with our team. Because what’s important to us is putting people together who are smart and intelligent and driven, but most of all, they like each other and they really enjoy being with each other. If you can do that then great things will happen. You can’t get that out of an interview.
What the team does, instead, is a “mutual assessment” trial period to confirm cultural/work fit before a full-time role is offered.
It’s like try before you buy on both sides. Again, this has been incredibly successful for us. It resulted in us having extremely high retention. Very, very rarely does an employee leave TaxJar.
Have a Dedicated Onboarding Week
A new employee’s job in the first week is to understand the company and how to work there:
…after they get hired, they go through what’s currently a one week onboarding process where they’re really spending probably 80 to 90% of their time just onboarding. So, they’re not trying to balance the work that they’re supposed to be doing with onboarding.
Why the TaxJar Team is in the US
So far, concerns about compliance have held TaxJar back from hiring remote workers in countries outside the United States:
…if we’re going to do it, we want to do it right. We want to make sure we understand all the local laws and be compliant there. Not just hire someone, and then figure out six months later we’ve done things wrong, and that causes more work in the long run.
No Instant Messages Please
After experimenting with different tools, TaxJar decided to use Basecamp. Previously, they tried out an instant messaging tool, and didn’t like it:
This was unanimous across the entire company. People said we don’t want to work this way anymore. The environment that was being created was that everything was urgent. There was constant pinging…
Raising Money as a Remote Company
In the beginning, not everyone was convinced that remote companies could succeed:
…when we started the company, we did raise a little bit of money, and there was a lot of time spent on not so much the business, but how were our setting up the company and this whole remote thing. And almost everybody challenged it. It’ll never work. It’ll never scale. […] it’s crazy to think about how much of the time we spent trying to convince people that this was a legitimate way to work.
(Luckily, everyone knows better now!)
Other CEOs = Biggest Remote Sceptics
…and Mark has no time for their objections:
…the folks who I get the most resistance from are the ones that have never worked remotely before. They’re the CEOs of other companies saying, “You’ll never be able to do this.”
I’m not trying to be a jerk, but the response I always say is, “Have you ever worked remotely before for a significant amount of time with a remote team? Try it, and I promise you, your mind will be changed on this.” So, it’s just more exposure, more time […] All those barriers are being broken and will be broken over the next five to 10 years.
Start Out 100% Remote
Mark has a strong recommendation for future companies out there:
I think starting 100% remote is the way to go versus being co-located and then trying to go backwards into a remote company. I think that’s just more challenging. If you have the benefit of trying to start fresh and clean and be remote right from day one, I think you have a better chance for success.
I also am in the minority here on this one, but I think if you’re going to be remote, then you have to be 100% remote. […] having 10% of your folks work remotely, and 90% working in the same location is really challenging. To me, that’s not a remote company, it’s sort of you have a remote policy. But don’t underestimate the fact that the 90% that are in that building are always going to know more and have more context than that 10% that’s working from home.
Full Podcast Transcript: Ep. 1
Today I’m joined by Mark Faggiano, the founder and CEO of TaxJar, a 100% distributed SaaS company that helps businesses automate their sales tax calculations and filing.
We talked about Mark’s genuine passion for remote work, why he personally handled new team members’ onboarding in the company, and how having an Employee Experience Team is vital for TaxJar.
If you’re enjoying the podcast, please consider leaving a review on iTunes!
The podcast is also available on your favourite players: iTunes, Google Podcast, Castro, Overcast, Spotify, Stitcher, Player.fm, and Tune In.
Follow us on Twitter to get updates.
Topics covered on the podcast episode:
- 03:00 — Why Mark is passionate about remote work
- 06:30 — The point during company scaling when it started to become harder to + convey the company’s core values 06:30
- 10:40 — The importance of employee onboarding, and why Mark decided to personally onboard new employees until the company grew to a team of 20
- 16:00 — The importance of the Employee Experience Team and People Ops to TaxJar
- 25:00 — How TaxJar’s transparency helped build trust among potential customers and new hires
- 31:00 — How remote job applicants can stand out
- 42:45 — Why it is now easier to raise money as a distributed startup
Hope you enjoyed the show!
Mentioned resources:
Full transcript:
Jovian: Hello world, welcome to the first episode of Outside The Valley. A podcast where we interview remote startup leaders, workers, remote work advocates, and companies who thrive outside of Silicon Valley. Outside The Valley is presented by Arc, the all-in-one remote hiring platform that enables companies to easily hire remote software engineers and teams. I’m your host, Jovian Gautama.
Today I’m joined by Mark Faggiano, the founder and CEO of TaxJar, a 100% distributed SAS company that helps businesses automate their sales tax, calculations, and filings. We talked about Mark’s genuine passion for remote work, why he personally handled new team members onboarding on the early stage of the company, and how having an employee experience team is very viable for TaxJar. I had a great time chatting with Mark, and I hope you enjoy this episode as much as I do.
Here we go. Hello, Mark.
Mark: Hey, how’s it going?
Jovian: Great. Thank you for coming to our podcast.
Mark: Awesome to be here. Thanks for inviting me.
Jovian: Awesome. Cool. Just to kick off, can you share a bit more about yourself and a brief history of TaxJar?
Mark: Sure. About me, I’m a career entrepreneur at this point, started a handful of businesses. Started my first business in 2003, so I’ve been at this for a while. TaxJar we started… We just celebrated our sixth birthday. So, in 2013 is when we got things off the ground. We are all about automating sales tax compliance for e-commerce businesses. It’s probably a space that not very many people think about unless they are in e-commerce, but it turns out it’s one of the most painful parts of running an e-commerce business.
So we do everything from determining how much tax should be collected at the point of sale to giving you reports on how much is being been collected, and then automatically filing those returns to the state government. That’s basically what we do in a nutshell.
Jovian: Awesome. And how many employees do you have now?
Mark: As we’re recording this, we just reached 100. Officially, this week.
Jovian: Oh, wow. I thought you guys are like 60 or 70 something.
Mark: Just this year, we’ve doubled the team. We started the year with right around 50. So in six months, we’ve gone from 50 to 100. A lot of interesting challenges that come with that.
Jovian: Right. That’s super interesting. Okay, so on the TaxJar’s culture and core values, which I found very fascinating. You had a blog post in Medium about TaxJar’s core values, and there’s one passage here that I’m really quite fascinated about. This is written by you. I’m coining here, in our minds, remote work is the only way we know how to work. We don’t understand commutes. So, as I was reading this, I told myself, “Oh, this is kind of badass.”
Basically, this is one of the strongest, if not the strongest statement of remote work I’ve ever seen stated by a company. And when I was doing research about you, I realized that you are a very strong proponent of remote work since the very beginning. Even there’s this one podcast interview, the podcast host I think Shira from SAS Insider asked you, “What questions do you hope that I ask?” And the first thing that you said, is basically you said, “Yeah, I want to tell more about my passion about remote work.” So can you share more on this? How can you be so passionate about remote work?
Mark: Yeah. I think the line that you pulled out of there sums it up pretty well. I mean, I’ve been working remotely really since 2001. So, at this point, I don’t know another way to work.
I’m not comfortable with the idea of getting into a car, having to wake up earlier than probably normal, getting into a car, sitting in a lot of traffic, and then going into a building. And that is supposed to dictate when I am going to be productive, right? That concept to me doesn’t make any sense.
One of the biggest things that I learned in my first few years of working at home, working remotely was, I’m not going to be necessarily productive between eight and five. That’s not going to be. I lived by myself at that point. This is before I got married and had kids and everything, but I might be really productive at 5:00 AM. So why not get the most work on at 5:00 AM, and then break up my day. And then when I’m feeling more productive, I get back into work.
So, the whole concept of dictating when I’m supposed to be doing my best work, I think that’s one of the biggest advantages of remote life, is that we all have a job to do. But it’s up to us to determine how we get that work done, and when we get that work done. The only stipulations that we have at TaxJar is that you’re doing your best work, and you’re doing it on time.
Otherwise, we don’t care if you’re working all night or taking a two hour break to go to the gym or take care of your kids or whatever it is. That doesn’t matter to us. What matters most is the end result.
I think remote work lends itself best to that. Like we said the beginning, it really doesn’t make sense to me otherwise.
Jovian: Right. I think that’s super fascinating. But of course, when you are 100% remote companies, there are also challenges as you scale and hire new team members. And you also mentioned on the blog post saying that one of the challenges you realize that as you hire new team members, it’s not easy for the new team members to get on the same page with the older team members. The newbies or the new team members only understood what you told them and not necessarily the real spirit and the value of TaxJar. What was the point that made you realize that this is an issue? Any anecdotes on that or story?
Mark: Yeah. I’m trying to think. We were probably at around 20 employees. This is… I may be getting my dates wrong, but this is within the last 18 months, two years, something like that. I was doing all the onboarding, basically because I didn’t have anybody to do it. So, there’s two things going on. One is my time to really onboard people like I wanted to do was becoming less and less. I wasn’t able to do the job that I really wanted to do.
And the first few employees probably I was able to spend as much time as I needed, and to teach them what we call the TaxJar way. The, here’s the history, here’s a lot of context that you need. Here’s what we expect from you. Here’s where to find what you need. Here’s how to sign up for benefits. All of those things. And as we started hiring more employees, my time started to shorten up and I was not able to give 100% of those things.
What we noticed was that there was confusion around where do I go for basic things? How do I get signed up for this, that or the other thing? How do I get my questions answered? And those are things that should have been explained in a proper onboarding process. So that’s the point where I realized we need somebody to come in and be 100% focused and dedicated.
And that was our first employee experience hire. That’s when we brought in our head of employee experience, right around 25 employees, and said, “Your main goal is to build a world class onboarding experience to make sure all of the things that we just talked about are included in there. So that somebody can come in, they can spend as much time as they need wrapping their head around what it’s like to be an employee, what it’s like to work here, where do I go when I need something?”
Then just to go off topic for a second, what that role is also evolved into is making sure that our employees have everything that they need to do their best work beyond onboarding. And really that’s had a huge influence on our culture.
So our employee experience team has also taken a major part of the ownership of the culture as well and shaping that and allowing that to evolve over time.
Jovian: Right. I actually find it interesting that you mentioned you did the onboarding yourself up until like almost 25 employees. Because as far… I mean, usually at that stage, founders like you will focus either on the product side, or the sales side, but you actually spend a lot of your time to onboard new hires yourself. So, I’m just curious about this. How to say this, why would you do that? When did you realize this is important?
Mark: Yep. Probably very early on. It was pretty clear to me and this is through experience trying to build other teams. It’s all about the team. That’s what matters the most. So, we have to get…
There’s a lot of things that we want to do, and there’s goals that we want to accomplish, and we want to get someplace in five years, 10 years, 20 years. We can’t do that without the best team possible. That breaks down to every single hire has to be put in a position to succeed. You can’t do that without a really, really helpful and valuable onboarding process.
Yes, I was involved in some of those other things, sales and marketing, customer support at that point as well. But to me, where I could add the most value was making sure that every new person that we hired had the best experience that they could. And just as we started to scale, again, that started to be impossible for me and we needed somebody that was better than me at that, that could dedicate more time than I couldn’t do it.
Jovian: Yeah, that’s very interesting. I guess it’s your experience from previous ventures and previous companies. And up to this point, you realize that, okay, people are number one, I spend my time making these people, these new team members understand our mission, our vision, and where we’re going as a team. I think that is super fascinating.
Mark: Let me just add to that. I still, through, we’re at 100 employees now. Part of everybody’s onboarding experience is they spend an hour with me. The only difference now is that in the early days, I would do a one on one hour with you. That’s sort of impossible because we [crosstalk 00:11:38] five, eight people at the same time. So we schedule that one hour, and I give a presentation, and do a Q&A for as long as they have questions. And a lot of it is about history, how this thing got started, how we got here, trying to explain how much opportunity there is for us, why they should be really excited, and what we expect just in terms of how they work. Again, going back to the TaxJar way.
Mark: And the thought there is, first of all, they get to meet me, which is really important for me and I get to meet them. But also, it’s kind of like, “Hey, we want you to find out very early on this is what we expect of you because we don’t want you to get three months in, six months and have the experience of well, nobody ever told me that this was important right? You actually have been told, the expectations have been set. And we have total faith in you that you’re going to go and do a great job for us. You have to do that early on. Can’t give that to somebody eight months after they [crosstalk 00:12:40].
Jovian: That is super cool. I kind of want to ask a bit about, as your team grows, and all of a sudden there’s all these new faces from a like 10 people team, now you hire like 50 people. As we have more people, which means for processes, and things take longer. Were there any mental adjustments that you had to do as a CEO to accept, okay, this thing will take longer than usual because the theme is larger and we need more processes. Was it a painful transition?
Mark: Yeah. And it still is. I think we all… A lot of us that have been around in companies that have two or three or five or 10 people really appreciate the fact that there really aren’t a whole lot of rules. There are no processes.
Jovian: I feel you.
Mark: You might have seven jobs, right?
Jovian: Right.
Mark: The people that do the best in those environments, they just love that sort of challenge. They don’t care about what their title is. They don’t really care about an org chart. They don’t care about anything other than trying to figure out how to take absolutely nothing and turn it into something. That’s where they get the most joy. I love that phase as much as everybody else.
I admittedly would cringe every time the word process came up. And the first time, I can remember it clearly when we said we need an org chart, and I went, “Oh, seriously? Do we need to do that?” But you have to get over that really quickly because the reality is, now you have a lot of new people, you have people that you don’t know. And the worst mistake you can make is they don’t understand where they fit into the organization, and where the opportunity is for them.
What I’ve learned is it helps for folks to be able to look at that org chart or get a sense of the company and be able to think about, “Okay, if I do a really good job that means I could go to this place in the company or that place.” The reality is 100 is still small. If you did a great job, there’s opportunity popping up everywhere. We can build a team around you that doesn’t even exist right now. But yeah, that’s been a challenge. It still remains a challenge.
We’re still extremely fast and are able to do things super fast. But you do have to adjust as a CEO to realize, things are a little bit more complicated, and there needs to be processes developed. Otherwise, you go sideways, and that’s the most frustrating thing.
There’s no process. Everybody standing around waiting for somebody to make a decision. That’s death. You can’t let that happen. So, where it makes sense, get those processes, otherwise…
The other thing I’ll mention here is try to retain as much as you can that sort of startupy feel. That we don’t want to get too regimented. What made us great, and what got us here was the ability to think quickly, make decisions fast, and get to work. We don’t want to implement artificial bottlenecks just for the sake of having processes.
Jovian: I think that’s a fantastic insight. I want to move on, on through the employee experience, and the people ops on TaxJar. So, I saw that you guys have really fun culture. I saw that there’s cake baking contest to celebrate the birthday of TaxJar every year. And there’s also, it’s not like a singing contest, it’s more like a tradition for new team members to sing. Am I correct?
Mark: Right.
Jovian: Right. Can you share a bit more about these two things?
Mark: Sure. Yeah, I mean, when you’re remote… Well, any culture really, it doesn’t matter if you’re remote. You have to come up with fun ways for people to do things together that aren’t work related, right?
Jovian: Right.
Mark: The cake baking thing. I mean, that was I think our head of employee experience, Darcy, would tell you that was sort of a shot in the dark. We had a birthday coming up and people think about cake on their birthdays. Let’s see if anybody will sign up to bake a cake. And sure enough, there’s probably almost 10 people that did it the first year, and it was great. Everybody absolutely loved it. We said, “We got to do this again.” And we just had the second one, and there was probably 20 people who baked something.
It’s mind blowing. The amount of time and creativity that people put in, and how much happiness it brings to the rest of the employees. Everybody was already looking forward to the contest the next year.
So, you don’t always get it right. You don’t always come up with the perfect idea. In that case, it’s something that just fits and works for us, and it’s exciting.
On the song side of things this was… I wrote a blog post about this. This is a tradition that I took from college actually when I-
Jovian: Oh, really?
Mark: Yeah, I was on a college baseball team, and this was one of the things that every new member of the team had to do. The thing that I took away from that was that once you sang that song it was like you are really official member of the team at that point. That made an impression on me. We started that really early in the company, really with our first employee. It’s changed over the years. We make it optional now. Not everybody has to do it. It’s harder to sing in front of 100 people than it was to sing in front of four people. So we don’t want anybody to feel any sort of unnecessary pain or pressure or anything like that.
People have really enjoyed it. Again, it gives new folks the chance to be creative and show the side of themselves that you can’t really see in an interview, and people write their own lyrics. They bring in family members and they dance. They build these creative sets and backgrounds, and just put on a show. It just breaks up the regular kind of routine and monotony of the work day, and brings a smile to people’s face, and we really enjoy it. So, we’ve kept it.
Jovian:
It feels like it’s even more important because it’s like for distributed teams you need this even more to bond because there’s probably less opportunity to bond in person.
Mark: Yeah, that’s right. I mean, for sure. You can’t take every new person out to lunch or go out to drinks after work, and socialize in that way. So, you do have to be creative on how to socialize with each other. And we’ve tried all sorts of stuff. The other thing we do is what we call skill shares. So, once a month, somebody will… If they’re a chef, or we have somebody that built a tiny house and showed us how they work from their tiny house. They turn on Zoom and they got the camera on and they show us something that they’re really passionate about.
The other thing we do is Friday FaceTime, so every new employee will do a half an hour where the rest of the team will get to ask them questions, really silly questions or really powerful questions or meaningful questions, but it’s just a way to get to know that new person. And when you hire a lot of terrific people like we do, it’s really fun. So not every single thing that we’ve tried works as well as some of the things we’ve mentioned. But we found a lot of great things, and it’s a way for the new folks to get to know the folks that have been around and vice versa. And it’s really helpful for us.
Jovian: Yeah, for these kind of fun culture, what’s the ideation process looks like? Does it usually come from you or does it usually come from the head of employee experience?
Mark: Yep. Mostly, I mean, I may have an idea from time to time but really, Darcy, our head of employee experience is driving all of this. She has the best sense of what will resonate with the team, and we may have a discussion about it, but for sure, she’s taken full ownership of this and done a terrific job. Some of these ideas actually come from the team too, and we’re totally open to that. And so, it’s a collaborative, it’s a group process, and it works really well.
Jovian: Yeah, I do feel like it’s not being talked too much. [inaudible 00:21:24] it’s all about how to create new product, how to create new marketing campaigns, but they don’t really talk about this. How to create new fun games or new fun initiatives for team bonding. It’s probably some people write about it somewhere, but not as much as the thing that “makes money” anyway, but this actually is the most important thing. Still related to the employee experience, on your blog you have this Life At TaxJar section. Lot of great content about the life in TaxJar from an employee’s perspective, how would you describe the importance of this section internally for your team members and externally?
Mark: So internally, I’m not sure how impactful it is because we’re very transparent internally. Most of what you see or really all that you see on that life blog is known internally. But externally, this was a complete… I can’t emphasize this enough, this is a complete game changer. And where this came about was, a lot of this was related to hiring.
We would try to be hiring for a really important… Every single hire is still important, but especially in those early days where you might be a developer or two short, or you needed the first marketing person or whatever it is. People could go to your website, but they didn’t get any sort of sense about is this a legitimate business? Why on earth would I choose to work for this company called TaxJar versus these other companies that I’m considering?
One of the things we noticed was that we were spending a lot of time trying to sell you on why this is a great place for you to work. We weren’t always successful.
And if we could get people into our mutual assessment, then we felt like that was a great tool, and people would see what it’s like to work here. But we realized there was probably a lot of really talented people who looked at our job listings, but then just chose not even to send an application. They’re like, “I don’t even understand this company.”
So, the brilliant idea that we had, and I think this came from Lizzie on our marketing team was, why don’t we just show people what it’s like to work here?
Open the door, and we’ll tell them stories about what it’s like, and then for the people that our culture resonates with, they’ll get very excited and they’ll want to apply here, and that’s exactly what happened.
Almost instantly, we noticed a big uptick in the amount of people that were applying for jobs with us because they could make the decision based on what they read. Either they enjoyed what they read and that’s a culture that they want to be part of or not. And that’s fine. They can go apply somewhere else. It’s their decision. But we didn’t have to spend as much time in the process spinning our wheels trying to convince you, “Hey, this is a great place.”
Instead, it was people were coming to the interview saying, “Hey, I read the entire life blog. I love what you’re all about. I want to work here.” That was really an amazing evolution for us. And to this day has continued to be super valuable. So, we believe in being as transparent as we possibly can, but the added benefit here is it’s been a tremendous value for our hiring process.
Jovian: Honestly, I won’t even be surprised if some customers decided to choose you just because from that section because I feel like a lot of SAS companies now are lacking the human connection, so to speak. Like I’m buying from you, I want to know who am I buying from? And who are these people that’s creating the product that I use. I’ve also mentioned on your blog post you mentioned that a lot of your customers actually use TaxJar because of the sales and the support team, which is very friendly to them. So I guess Life At TaxJar is also an addition. If I [inaudible 00:25:34], I’ll probably look at it, “Hey, this is a nice company. I’m curious if they’re a great solution.”
Mark: So, you’re absolutely right. One of the things that we realized was by putting out that vibe, and showing people what we’re like we are giving customers the opportunity to… Same thing, they can either read all of that material and think, “I love what this company is all about. I want to work with them and partner with them.” Or, “I don’t understand this. I choose to go elsewhere.” And we talk about this internally all the time.
Our job is not to win every single potential customer that exists in the world. Our job is to win the deals where our values, and the way that we do work resonates with the customer.
Those are customers that we want anyway, right? We don’t want customers that we’re going to clash with that think about things in the world completely differently than we do. So, all the more reason. It’s more fair for the customer to be able to have more tools to evaluate who we are, what we’re about, how we work, what’s important to us, et cetera.
Jovian: Totally agree with that. I want to move on, on TaxJar’s hiring process. So, from what I’ve read TaxJar has this so called mutual assessment period. Can you share a bit more about that?
Mark: Sure. So, without the benefit of being able to bring people in to have face to face meetings, and multiple face to face meetings. We realized very early on that we had to build a workaround for that. Depending on the position, we have various rounds of Zoom calls, which are our interviews. And where the mutual assessment came from was, okay, we feel really good about this candidate. They’ve done a great job in the interviews. On paper, they seem to have exactly what we need. The resume tells us what we’re looking for. But at the end of the day, we don’t really know if they can do the work, and we don’t know if they can work with our team.
Because what’s important to us is putting people together who are smart and intelligent and driven, but most of all, they like each other and they really enjoy being with each other. If you can do that then great things will happen.
You can’t get that out of an interview. We can get along really well in an interview, but until you and I sit down virtually together and try to work together, there’s a lot of unknowns.
So the mutual assessment for us, and we read that other remote companies were doing this. We didn’t come up with this process on our own by any means, was the perfect way for us to figure out, can they work with our team? Can that person work with our team? Can they do the type of work at the level that they claim to do it? Are just selling us or are they actually as good as they say they are? And then more importantly for them, this is where the term mutual comes in.
They get an open look at what we’re all about, is what’s on the life blog true or not? Do I believe in what this team is doing? Do I care about working in the future of sales tax or not? Am I fully convinced that remote is right for me? Do I believe that the leadership of this company is leading them in the right direction? All of those things? It’s like try before you buy on both sides.
Again, this has been incredibly successful for us. It resulted in us having extremely high retention. Very, very rarely does an employee leave TaxJar. It’s only happened a few times in six years. So, it just helps us make a better decision [crosstalk 00:29:17] in terms of who we are.
Jovian: Right. Your onboarding process, so after someone got hired, and then what’s next?
Mark: Yeah, so after they get hired, they go through what’s currently a one week onboarding process where they’re really spending probably 80 to 90% of their time just onboarding. So, they’re not trying to balance the work that they’re supposed to be doing with onboarding. It’s focused on onboarding, and there’s a whole slew of things that they’re doing. They’re picking out their benefits. They’re reading our handbook. They’re meeting folks outside of their team because they’re met a lot of folks on their team through the mutual assessment. So, they’re not just walking in not knowing anyone.
There’s a lot of education around trying to learn the domain. So, most folks that we hire don’t understand sales tax. We’re trying to get them trained up on that. We train them in Basecamp, which is where we live. So, there’s all sorts of things. Giving them the tools, we’re ordering them their hardware, software, all that kind of stuff, so that within a week they’re ready to go.
Jovian: You mentioned handbook, is it like a real book or it’s just like a document?
Mark: Yeah, it’s just a document that lives in Basecamp.
Jovian: Okay. I thought it’s like a real handbook that you send to [crosstalk 00:30:45]-
Mark: I wish, I wish it was.
Jovian: That [crosstalk 00:30:48] really cool actually.
Mark: That would be cool. That’s a great idea.
Jovian: Cool. So, that’s the onboarding part. Sorry, the onboarding, and the assessment part. But I want to go slightly higher in the very early stage of the hiring process, the application process. So, everyone wants to find remote jobs nowadays. With the flexibility, and the utter benefit that comes with it. I saw your tweet a while back that you mentioned that you’ve got hundreds of applications per job post. And it’s not even an exaggeration, it’s real. Like 400 plus something. My first question will be, do you have any process in processing these high volume of applicants?
Mark: Yeah. We’ve had to build a process basically. This used to be something that one person could manage. Again, I was very involved in this early on. It was a combination of myself, and who was doing the hiring on the team. But we had to hire and build process around this.
So, our head of employee experience has built out basically a talent acquisition team where now those folks are dedicated to not only trying to find talent, so sourcing talent on their own, but essentially processing the applications that come in.
So, reading every single one of those applications and comparing it to the list of what we deem to be important. Like what are the things that we’re looking for in that first application? Moving them into various stages. So, the ones that make it through that first stage, then probably move on to second stage, which could either be an actual interview or some sort of back and forth over email. Screening, basically.
Then moves into a series of interviews. It’s kind of unique to the particular hire. So developers would go through a different process than maybe somebody in customer support. Ultimately what we’re doing is trying to assess skill. Do they actually have the ability to do the job that we’re trying to fill, but also the culture side of things. Do they have the skills to work remotely? Are they a team player, all of the things that we deem to be the really important ingredients and combine those two.
If you make it through all of those interviews and convince us, then that’s where we get to the point where we offer you the chance to do a mutual assessment.
Jovian: How can an applicant stand out in this resume stage?
Mark: Yeah. We try to encourage folks to treat that resume stage, that filling out the application as a first interview.
Put in as much effort as you would if you were showing up and having a face to face interview.
If you showed up to that face to face interview, you probably would put on nice clothes, and you probably would show up on time, and do the fundamental things. But people don’t always do that when they’re applying to something online. So they don’t answer questions. They don’t spell check. They don’t use great proper grammar. You can tell the people who are just filling it out for the sake of filling it out, versus the people that are saying, “Okay, this might be my one chance to be noticed to move on to the next phase of the hiring process.”
So that’s what we try to say is, take this for what it’s worth because we can tell the difference between the folks that have taken this seriously and put forth some effort and value the time in filling out this application versus those that don’t.
So, never underestimate how important that first stage is, and know that especially with us, somebody is reading that and evaluating that and competition is stiff. So, be yourself and answer the questions as honestly and as openly as you can. And use it as an opportunity to be noticed.
Jovian: Do you hire employees outside the United States now?
Mark: So, we haven’t yet. We really want to get to that face. We get asked this question a lot. The biggest reason why we haven’t is because there’s a lot of compliance that comes with hiring full time employees in different countries. Historically, we just haven’t felt like we were ready to be compliant in a number of different countries. So, I think we’re getting a lot closer.
We’re closer than we ever have been, and we’d love to get to that point. But if we’re going to do it, we want to do it right. We want to make sure we understand all the local laws and be compliant there. Not just hire someone, and then figure out six months later we’ve done things wrong, and that causes more work in the long run. So, that’s kind of the approach that we’ve had to that.
Jovian: Yeah, totally agree with that. I want to move on to some team management tools.
Mark: Sure.
Jovian: You guys don’t use slack, right? You use [crosstalk 00:36:18]-
Mark: We don’t.
Jovian: Is this a deliberate decision?
Mark: Yes. So early, I mean, at the very beginning stages we actually used, this is 2012, 2013. We were all on Skype, and using Skype chat.
Jovian: Oh, wow.
Mark: Yeah. So, that lasted probably a few months and realized this isn’t working.
Jovian: No judgment here.
Mark: Yeah, yeah. We only had a few people at that point. So we realized we needed something, a better chat tool. We were using Dropbox to store all of our files. There was no big file storage needed at that point. It was more like how do we talk to each other? We chose not to use Slack for no reason other than… I’m not sure we spent more than 30 minutes thinking about it. We didn’t choose it. Then we chose basically a Slack equivalent, a tool that was very much like Slack.
We got to the point where… I remember this vividly as well. We got to about 20, 25 employees, and we were at one of our team retreats, which is when we get everybody together. And one of the big discussions we had that week was…
This was unanimous across the entire company. People said we don’t want to work this way anymore. The environment that was being created was that everything was urgent.
There was constant pinging, and even if I was trying to message you or ping you, and I wasn’t trying to be urgent, I was trying to convey something to you-
Jovian: FYI [crosstalk 00:38:13].
Mark: Yeah, exactly. It was causing a lot of stress. It was so clear after a few minutes of that discussion that we were having as an entire company, we needed to make a change. This was not sustainable, or else we’re going to start to lose early employees, and we did not want that. I think by the end of that retreat, we had picked out Basecamp and basically said, “We’re going to try Basecamp. Let’s just see what this is like, and if Basecamp is great, then we’ll use it. If not, we’ll find another tool.”
At that point unanimously, Basecamp was loved by all the employees that we had because it solved the sense of urgency to a degree. It’s not perfect in that way. But it also has a file storage. It also had the ability for us to create our handbook internally.
It solved the problem of one tool for all. It was a place to communicate. There was several different ways to communicate, you could store files. We could put everything in one place instead of having some stuff on JIRA some stuff over here, some stuff over there. We were using Trello at the time too, and we moved off Trello. So, that was a big move. I will tell you, going from 30 employees or whatever it was at that time to 100.
We’re asking that question again internally, like what is the best place for us? Basecamp is awesome, we love it. But what we found is that we’re probably not doing as good a job as we could be training new employees about how to use it. We’ve fallen off a little bit there, and it needs to become more of an onboarding priority for us. This is really dumbing it down to the point of, okay, you’re in Basecamp now. If you’re looking for X, Y, Z, you go to this exact location.
The whole purpose of teams versus projects, pings, et cetera. We didn’t do a good job of explaining that. So, probably for the last year or so employees have been trying to figure that out on their own, and that’s our mistake. We need to help them better with that. So it’s a fascinating discussion.
We talked to a lot of remote companies about this all the time because we’re trying to figure out, how do you do things? There is a split between how you communicate, and how you do work? So, how you set your list of priorities. Some folks use Basecamp, but they prefer to keep the prioritization in Trello still or in JIRA or something other than that. Then you have plenty of companies who are very loyal to Slack. That’s just not who we are, and that’s not the way we want to work. So that’s why we’ve decided to go in this direction.
Jovian: Right. About finding stuff is actually… I feel like it’s not even a problem for remote companies. Like for us, we’re like hybrid teams. Even us, we’re sitting in the same room, sometimes it’s hard for us to find things. Okay, where do I find it… It’s already hard. You really need… And it’s great that TaxJar is aware of that. That you know this takes time. With all these great tools, you actually need time to learn all of these. So yeah, that’s a great [crosstalk 00:41:39]-
Mark: Totally agree. One thing I always say is, people say, well, remote must be so much harder. But I’m not sure the problems that we have are any different than if we were all in that same [crosstalk 00:41:53]. Communication is still a problem, trying to keep files organized, and onboarding, all that stuff has to happen to build a successful business. Is it different because it’s remote, of course. But those things aren’t unique to remote companies, and you can understand that. So, that’s why I get a little fired up-
Jovian: Totally agree.
Mark: People always think that it’s just impossible because it’s remote.
Jovian: I want to move on to more like the big picture thing about remote work. So, I know that you guys just raised $60 million of a Series A, I think, in January. Congratulations for that.
Mark: Thank you.
Jovian: I saw that you mentioned in your press release, you mentioned that it was easier to raise money as a distributed team now, compared to when you raised your seed round around four years ago. You mentioned around nine of our 10 investors just bail out when they found out that you guys are distributed teams. Can you share a bit more on that?
Mark: Yeah, happy to. It’s pretty fascinating because it has happened in a short amount of time, five or six years.
I mean, when we started the company, we did raise a little bit of money, and there was a lot of time spent on not so much the business, but how were our setting up the company and this whole remote thing. And almost everybody challenged it.
It’ll never work. It’ll never scale. You’ll have to build… When you eventually build a sales team, they’ll all have to be in the same room. Same with customer support, those folks will all have to be in the same room, and we had a lot of pressure early on. Are you strong enough to make the decision to change the company from all remote to being co-located at some point? We never committed to that obviously, right? I mean, it’s crazy to think about how much of the time we spent trying to convince people that this was a legitimate way to work.
Now fast forward to just this past, six months ago, I’m going to say we spent almost, maybe even less than 1% of our discuss talking about this. Instead, the conversation had turned to, look, you’ve already proven that this is a great way for your company to work. So we’re not going to second guess that. We’re not going to try to force you to be someone other than who you are.
And by the way, there are other success stories that are already out there. This is not a new thing. You’re not trying to… and it wasn’t a new thing five years ago, either. But it’s just, we saw that it was much more generally accepted, and that was really refreshing for us to not waste time trying to talk about, yes, we can actually be a real company just because everybody’s working remotely.
So, big change, and one of the reasons why I’m really excited about the future of remote work is because very slowly the rest of the world is starting to warm up to this whole idea. The last thing I’ll say on this is, the folks who I get the most resistance from are the ones that have never worked remotely before. They’re the CEOs of other companies saying, “You’ll never be able to do this.”
I’m not trying to be a jerk, but the response I always say is, “Have you ever worked remotely before for a significant amount of time with a remote team? Try it, and I promise you, your mind will be changed on this.”
So, it’s just more exposure, more time, and I agree with you. All those barriers are being broken and will be broken over the next five to 10 years.
Jovian: My last question for today is that, do you have any advice for companies that are considering either to build distributed teams or make their first remote hire?
Mark: Sure. I would say, if you’re… Look, you got to do what’s best for your company, and what you are trying to do in terms of culture. So, you know your culture better than any outsider ever would.
But based on my experience, I think starting 100% remote is the way to go versus being co-located and then trying to go backwards into a remote company.
I think that’s just more challenging. If you have the benefit of trying to start fresh and clean and be remote right from day one, I think you have a better chance for success.
I also am in the minority here on this one, but I think if you’re going to be remote, then you have to be 100% remote. I think being… having 10% of your folks work remotely, and 90% working in the same location is really challenging. To me, that’s not a remote company, it’s sort of you have a remote policy. But don’t underestimate the fact that the 90% that are in that building are always going to know more and have more context than that 10% that’s working from home.
And I can’t tell you how many interviews that I’ve been on where folks have explained this exact situation to me. I’m super passionate about remote, but I’m in the minority at my company. I may only be the only remote person at my company, and it’s really challenging. I just don’t understand what’s going on. They don’t take the time to treat me the same way that they would someone that’s physically located in the same place. That’s why if everybody’s remote, I think you have an advantage because you’re just forced to think about it the right way.
Jovian: Yeah, that’s awesome. So, Mark, thanks so much for your time today. I actually really learned a lot from our talk. I’m really fascinated with TaxJar culture and your insights today.
Mark: It is my pleasure. Thanks so much for having me on.
Jovian: Thanks so much, Mark. Have a good day. That’s it for another episode of Outside The Valley brought to you by Arc. We created this podcast with the hope that in each episode, you can learn something new from other remote startup people. So, if you have any feedback or suggestions, please don’t hesitate to reach out to me at jovian@arc.dev. It’s J-O-V-I-A-N at A-R-C.D-E-V. Or you can find us on Twitter @arcdotdev. See you next week with another episode of Outside The Valley and ciao.
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