Building for the Distributed Future

COVID-19 has brought into sharp relief the inadequacies of some of our collaborative tools. Project management has long been seen as a “necessary evil,” but Clubhouse has been challenging the status quo of that category. The company’s platform is a collaborative home for software teams, with a more joyful, inclusive and communicative product. It’s being built by an-already distributed team. Despite that, Clubhouse CEO and co-founder Kurt Schrader said the shift to a completely remote workforce has provided fresh insight into how they can help customers (and themselves) build better together while we’re all apart. Kurt sat down with Greylock general partner Sarah Guo to discuss how the company is internally adapting to remote-first, how usage patterns are changing among their customers, and how Clubhouse is thinking about the next phase of product development.

This episode is part of our #WorkFromAnywhere podcast series hosted by Greylock partners Sarah Guo and David Thacker. You can listen to the latest here.

Below are key highlights from the conversation with Kurt Schrader.

What was the founding story of Clubhouse?

“My whole career has been about building, running, leading product teams. As your team grows, every team ends up needing some kind of project management software, and in my experience, the day you have to roll out a project management tool is just not a happy day.

In my last company, I was the CTO, and the day came when I had to roll out a big heavy project management tool, and the team came to me, actually my now co-founder Andrew, came to me and said, ‘What do you need out of this? What are you really looking for?’ and I said, ‘Well, we need to coordinate, and I need this kind of reporting and visibility,” and he and a few other people on our team built a new app using the APIs of our existing tool, just so we didn’t have to subject our team to the UI of the industry standard tool. When we left there, we got back together to build a collaboration tool for engineering and product teams, one that people loved but would scale, and one that would really help people work better together, and be more productive, and would pull more of the organization into the product development process.”

Clubhouse was founded on the idea of reinventing collaboration for product teams. What are the principles behind that goal?

“Building a product should be a conversation that includes not just the engineering or product teams, but that also includes designers, support teams, sales teams, marketing teams and finance teams. It should include everyone in the company. Think about the insights everyone can bring to the table and the diversity of opinions that the company holds beyond engineering and product management. You have a lot of people in your organization who are a lot closer to the customers than engineering, who have different expertise, and if you include those insights, and work iteratively, that will make your company a more customer-centric, better product company.”

“One of the ways this shows up initially in our product is we’ve put a lot of work into keeping Clubhouse friendly and intuitive enough for anyone in the organization to understand, so it’s purpose-built for product companies but not just for engineers. But what we’re building towards is really letting people see the entire lifecycle of product — why are we building this feature, who are the customers asking for it, what’s the right way to show that why to everyone, and did we succeed? We want people to be able to see the entire lifecycle and have the conversation internally, to follow along from Zendesk ticket to comments on whether it’s a good idea, to embedded Figma mocks, to the code itself, and at the end really being able to close that loop, and go to the customers that asked for that feature, and let them know, “That thing you wanted a week ago or a year ago, we did it!” and coordinate that thread from support to engineering to product marketing. We think you should pull those conversations out of emails, post-its, slack channels where they get lost, and keep the thread.”

“Another thing we believe you should really love the tools that you’re using. They should bring you joy on a day-to-day basis when you’re using them. And I think too often we just accept clunky or slow project management, or project management that is not built for the user. Incumbent tools seem to be built for getting someone else’s task done, and designed only for whoever is keeping track of status, forgetting about the engineers and designers that are building day-in day-out. Those people, the builders and creators — they just don’t get a lot of value out of existing project management. You see that in the negative NPS scores for these other tools. The industry has just settled and said the tools we have that we don’t like, they’re fine, it’s a necessary burden. But it’s not fine. If people are forced to use tools they really dislike to collaborate, how can they be collaborating well?”

Clubhouse was already on the journey to becoming a distributed team over time. What did that look like before March of this year?

“Clubhouse was founded in New York City, but as a company we’ve been hiring people all over the U.S. and all over the world over the last few years. We wanted access to the best talent all over the world. At the beginning, there wasn’t a lot of intention behind it. It was just a matter of trying to find the best people and figuring out how to hire them all over the world, and some of our people moving out of New York, and thinking we would figure out how to build a distributed company as we went along. It was really up in the air for a while, [we were asking ourselves] ‘Do we really want to do this?’ We had some fits and starts and then we realized over time we did want to do it, we wanted access to the best talent wherever it was. We evolved into a distributed company. We were about 70% distributed pre-COVID.”

What’s changed in how you’ve worked as a team through that evolution?

“To become better at being distributed, we needed to get a lot better at really writing everything down and being really explicit about communication. We started doing better with recording meetings – but until March there were still things that we honestly weren’t great at. As a classic example, a lot of times we still defaulted to meetings where some of us were in the room, some of the team was on Zoom. And then when Covid hit in March, it was a forcing function. It forced us to really fix the things that we needed to fix all along.”

“We’ve tried to really figure out how to build out a distributed team that works really well together, and there are a lot of tools and pieces in there, which the Clubhouse platform is a key part of. Just like a lot of teams have started using Clubhouse more as they have distributed, our data says we’re using it more too. We eat our own dog food every day.”

How has Covid-19 impacted Clubhouse as a business?

“Like a lot of companies early on, we saw things slow down a little bit. We do have companies that are in sectors that were really affected – we saw travel companies and advertising companies immediately impacted in March and the beginning of April. We saw some contraction there, and [also] some companies unfortunately going out of business and churning. But since then, because every team is now a distributed team, we’re seeing a lot more interest from companies looking for new and better ways to coordinate. A lot of teams are realizing things were partially being done with Post-Its on the wall, but a lot of the work was actually being done in those little conversations that were happening in the office. There was a lot of back and forth that doesn’t have a home now. So we’re seeing a lot of companies try Clubhouse or who were already using it and are now ramping up with it as their main tool for building products. We’re seeing acceleration and a lot of companies jumping on board.”

Anything you’ve built or accelerated in reaction to the pandemic?

“We’re accelerating our investment in the communication layer in the product, that’s always been our goal but that’s really come to fore. The other piece is really the buildout of the reporting side — when teams are not together, people have a much harder time seeing how things are going, and where they need to keep improving, or shift effort, or make changes.”

Are you interacting with your customers differently?

“One key thing we’ve built recently that we didn’t have before is a set of first class importers from other tools. And I think that’s really opened the door to a lot of these teams that might have been looking for a better tool – specifically those who might have heard of Clubhouse, but had a real investment in something else. Since we rolled those importers out, some of our success work has turned towards expanding throughout existing organizations by consolidating from their other tools that may not have been working as well.

“On the new sales side, instead of starting at ground zero…we are now helping new customers by doing an import and showing the power of Clubhouse — both in how easy it is to use and how much better it makes their existing workflows, how it makes it easier to have a conversation around what you’re building. We’ve seen a lot of uptake and it’s gone really well so far.”

What are the second or third order effects of long-term remote work you’re thinking about now?

“Big time zone differences are something that we’ve struggled with. Originally when we started to be distributed, one person who worked for us moved home to Melbourne, Australia. And that was 12 hours offset from, from New York. And he was great and he worked a lot of really late hours, he worked overnight to synchronize with us a lot of times. But for half the year when daylight savings time flipped in both directions, in both places, it became really hard. It went from 12 hours to 14 hours of time difference, and then your feedback loops get really long when you have very limited hours of overlap.”

What advice do you have for early or mid stage entrepreneurs navigating this time?

“Number one is focus. I think you should look at what you were planning to do (before March) and cut out half of it, and then you can expand the projects you’re working on out from there.”

“We have dropped the term ‘plan ’internally and just think of things as ‘projections.’ As CEO, you need to have somewhere in your back pocket, the worst-worst case scenario and just be ready. You can put those plans behind glass, but you should just be ready for that, and not scrambling to figure out what to do when something more challenging.

Any discoveries in your own life since Covid-19 hit?

“My wife Jin is keeping the earth from spinning off its axis, she’s a PM at another company, and is somehow holding everything together for our four year old daughter, and making space for me to run Clubhouse, so I can’t thank her enough for that. We’ve also been living with my parents at the house that I grew up in. That’s something I never thought I would say again in my life.”

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