RTO

Visiting an Asian web market is an eye opening experience for the uninitiated. I recall taking a good friend from out of town through a wet market in Hong Kong many years ago. I could see the shock in his face as he looked at slabs of raw meat lying on tables out or hanging on hooks in the open and cages of live chickens ready to be killed and plucked right in front of waiting customers.

In the US, we rarely see such displays of food handling. The closest we get to our food is picking up conveniently plastic wrapped cuts of meat. Growing up in America, that is how we expect our markets to operate, which we are told is the most humane, cost-effective, and hygienic way to provide customers with meat.

Recent food recalls by McDonald’s and Boar’s Head though show that not all food handling and processing is without risk. While the plastic wrapping and neatly packaged meats look safe, you have no idea what happened to the meat in between the process of slaughtering the animal to butchering to travel to handling within the store. All we see is the illusion, the hygiene theater hiding a complex food supply chain that can be vulnerable to contamination at any point.

Many of the things that put us at ease in the world are built on illusion. This is not to say these things are intentionally misleading or have no efficacy. It is just that certain systems at massive scale require an underlying foundation of trust in order to work. Consider for example things like the inflation rates which relies on the population to believe the perception of prevailing prices or TSA safety checks at airports which depend on travelers buying into the security theater meant to keep air travel safe.

One of the most talked about and divisive topics in realm of corporate culture and policy over the past two years has been RTO or Return to Office. Working in an office five days a week was the norm for most employees around the world pre-COVID. Then a two-year global pandemic showed us that people can work and even achieve massive results working exclusively online in virtual spaces from anywhere in the world.

As the world returned to normal though, corporate leaders have been working to claw back the workplace freedoms they once granted their employees. Chief among those freedoms is the option to work from home, reversing policies that force employees back to the office on a full time basis. Some of those are tech companies such as Amazon, Apple, and Salesforce as well as companies outside of tech like Disney, JPMorgan, and Sweetgreen.

Much of the reasoning backing RTO is mostly based on false narratives about how remote work negatively impacted companies. Some CEOs even tried to promote the idea that the policy was a workplace failure. Here is what we actually learned about work from home since 2020:

• It was not a mistake, it was a pandemic necessity.

• It was not a failure, it kept the global economy afloat.

• It was not a way to slack off, it added flexibility to schedules.

• It was not destroying culture, it showed what mattered in culture.

• It was not a productivity killer, it gave us back energy from commuting.

• It was not a management revolt, it forced managers to reinvent their value.

• It was not a barrier to innovation, it unleashed an explosion of startup creation.

Humans did what we do best and adapted to a challenging situation. We leveraged technology in smarter and more expansive ways. We invented practices to foster togetherness and culture across remote teams. We still built things and innovated.

Like many others, Amazon made an appeal to RTO citing the need to strengthen their culture and make innovation more effective. Without any actual data to back up these observations, it is hard to say whether any of this is true. It seems as if Amazon and other companies that have pushed for RTO would rather promote productivity theater.

Are companies being spiteful or impulse in their RTO mandates? Perhaps older executives feel more comfortable being in a full office as that is what they are used to. However, the thing to understand about the RTO comeback is that it is for the shareholders, not the employees. It is the same reason why companies do layoffs, roll back DEI programs, and make lots of empty announcements about their AI initiatives. It is investor theater to help shareholders feel more confident in the future direction of the company and its management.

When Andy Jassy, CEO of Amazon, announced the new five-day a week RTO policy, it was the same day I handed in my resignation. Many colleagues asked if that is why I left, but it was purely coincidental as I had planned to leave months prior. Some people have left however not wanting to return to long commutes, loud open offices, constant interruptions, and wasteful in-person meetings. For Amazon though, the net loss in talent will be minimal as it’s still a highly desirable place to work. They can get away with pushing RTO mostly because they can.

It remains to be seen what shakes out in the rise of RTO. Right now, employers, especially big tech, have the upper hand as the job market is soft. When labor markets tighten, you can be guaranteed employers switch back to making work from home a perk to attract talent. Some companies though have been quite successful either with hybrid or fully remote models like Atlassian, Supabase, or Spotify and plan to remain that way for the foreseeable future.

In the startup world, one of the ongoing debates has been whether being in-person or remote provides the best chance for success. Some say remote gives you more flexibility to hire the best talent while others say being together allows you to collaborate and work faster. Funny thing is that both sides are correct, but at different stages and circumstances.

I have been a mostly remote worker for twenty years with short stints in an office, so I have experienced both. For example, Stack Overflow was remote first but had four offices including the HQ in NYC. With my travel schedule, I valued working from home so that I could focus on being as productive as possible helping customers. When I was in the NYC office though, I saw the benefits of working in the office. I was able to build better relationships with colleagues, collaborating was easier, the serendipity of bumping into folks opened up new opportunities, and I felt more energized by the presence of others.

I believe the best collaboration happens in-person. For small teams in particular, it is important to be able to bounce ideas off of in the moment, feed off of each other’s energy, troubleshoot issues quickly, and tightly bond over a shared mission. This is where the culture of the startup is established and how teams begin to gel. I realize I don’t have any data to back this up, but most VC’s I have discussed this topic agree. They noted that when they reviewed their portfolios, in-person teams have mostly outperformed remote teams in terms of generating and testing ideas, shipping features, and hitting milestones.

Many people that dismiss the value of working in-person ignore the downsides of remote work. The isolation, lack of work boundaries, fatigue of video calls, disconnectedness with teammates, and communications overhead of remote adds unnecessary friction to small teams that need to iterate quickly on product. This is especially true of pre-product market fit startups that are just a handful of founders and employees.

Once a startup is post-product market fit however and ready to scale, the benefits to remote outweigh having everyone in one location. Startups at this stage can better take advantage of the world of talent available, are ready to expand into new markets, and have an established culture to more consistently onboard new hires. These more mature companies have processes and communication protocols to coordinate work across teams, so adding remote employees does not add excessive overhead as it would in an early-stage startup.

That being said, startups should apply their culture and principles in making the best decision for their employees. There is no one size fits all approach, and some situations will dictate the best choice of action. Many solopreneurs will often go the remote first approach to build a team faster. One the other hand, most co-founding teams will almost always be in the same location.

For my startup, I want to build a tight-knit team from the start and bring on one or two co-founders. This is partly why I chose Taiwan to build my startup because the costs of building an onsite team are more manageable than in the US, but in a locale with high quality tech talent.

What about your startup? Have you gone all remote, hybrid, or all in-person and what guided your decision?

MARK BIRCH

This week brought me back out to Silicon Valley for the launch of the Silicon Valley hub for Startup Island Taiwan. Though I only stayed for two days, a delegation of Taiwanese ecosystem leaders, startup founders, and government officials have been on a whirlwind tour to promote Taiwan’s emerging startup ecosystem at CES and the Bay Area the past two weeks.

I was there to have the honor of receiving the Taiwan Gold Card (yes, I know I got it back a few months ago 😂). It was really cool though to have Chin-Ching Liu, Minister of the National Development Council, to formally present the card to me during the opening ceremony for the hub. I also had a chance to be on the well-known Startup Zombies Podcast with my friend Jonathan Liao of the Gold Card Office to talk about enticing foreign talent to Taiwan.

I really appreciate all the folks that took time out of their day to meet in person during this short trip. There are some pretty cool startups folks are working on, and I hope to share some of their stories in future newsletters. For now, I am back in NYC from now till February 5 before I head back to Taiwan. Let’s connect if you are here in this frozen tundra of a city 🥶😅