The Case for Building a Distributed Workforce
Written by: Justin Reynolds
A lot of folks have the same misconception about remote workers: They’re lazy, unmotivated people who sleep the day away and, in the rare instances they actually do any work, they’re usually in their pajamas sitting on the couch giving less than their all.
That couldn’t be further from the truth.
Because of the benefits distributed workers bring to the table, many companies have already decided to at least allow some of their employees to tackle work remotely every now and again. Others are transforming into fully distributed teams that don’t even have a central office. In fact, a recent Entrepreneur article suggests that 59% of organizations plan to have more than half of their teams working remotely by 2020.
If you’ve never bought into the notion that a distributed team can help take organizations to the next level, it’s time to rethink your opinion. Here’s why:
1. Distributed teams save companies a ton of money
Office space is expensive. According to a recent report, the median rent expense for startups is $6,100 a month — or more than $73,000 a year. Then you have to pay for electricity, furniture, servers, office supplies, and an office manager. Slowly but surely, all of those expenses add up into a considerable chunk of change to the point it could cripple your cash flow.
However, when you build a distributed team and everyone works remotely, you will save a ton of money on unnecessary office expenses. You can use that money to grow your business however you want. Hire additional employees. Invest heavily in marketing. Develop new products. The sky’s the limit.
2. You are more likely to secure VC cash too
As office space becomes even more expensive — particularly in places like San Francisco and New York City — venture capitalists are tightening their purse strings and funding fewer companies, according to a recent item in The Guardian. This makes sense. Put yourself in their shoes. What’s the point of investing in a company only to have that company funnel a significant chunk of your investment to a landlord?
Companies that decide to build a remote workforce are more likely to secure VC funding simply because they don’t have to spend so much money on rent and associated office utilities and other costs. At the very least, having a distributed team shows potential investors that you’re agile, adaptable, cost conscious, and modern.
3. You can hire candidates with more talent potential
When an organization requires every employee to show up to work at an office every day, the talent pool that they are able to hire from shrinks considerably. For the most part, you can only hire people that work in the town or city you’re set up in. Maybe if you’re lucky, you can convince a few talented folks to commute an hour each way to work. But that’s it.
Distributed companies have a much larger talent pool to choose from. You can literally hire workers who are living anywhere in the world — which makes it easier to make the right hiring decisions.
Additionally, one of the perks top talent is most interested in is the ability to make their own schedules and work from wherever they want to work from. This is why the best candidates are attracted to distributed companies.
4. Distributed employees will enjoy a better work-life balance
Distributed companies are known to allow their employees to make their own flexible schedules — something that is proven to boost engagement. Sure, you may need to have all-hands calls every now and again where employees are required to be available during certain blocks of time. But that’s something that every employee understands.
While many companies require their employees to be at work during specific hours (e.g., 9 a.m. to 5 p.m.), does it really matter when your employees tackle their work? As long as they do a great job without missing any deadlines or meetings, why can’t they work the hours that are most convenient to their lives?
Your employees won’t reach their full potential if work forces them to routinely miss important events in their personal lives (e.g., their kid’s soccer game) simply because they’ll be unhappy. With a distributed team, it’s easier to embrace flexible schedules — which will improve your team’s collective work-life balance.
5. They will also be more productive
Studies show that remote workers are happier — and therefore more productive — than employees who are forced to head to the office every day. In fact, according to our research, a vast majority of workers (91%) say they get more done when they work from home.
Anyone who’s ever had to commute a long way to a job knows how soul-crushing those trips can be. In addition to dealing with rush-hour traffic, long commutes can add a lot of time to your workday.
When you’re able to work from home, your commute disappears completely. Instead of spending two hours of their day traveling to and from work and eight hours in the office, the remote worker might decide to clock nine hours from the comfort of their own home. Their day would still be shorter and your company will benefit from an extra hour of work. Multiply that across your organization for an entire year and you begin to see how much more productive your company can become when it’s distributed.
6. Distributed teams can appear bigger than they actually are
If your company is based on the East Coast and everyone works at the office, you can’t provide your customers with round-the-clock service. Everyone sleeps during the same hours.
Distributed companies, on the other hand, can consist of employees in practically every time zone. This enables organizations to take advantage of time zones and provide seamless support for their customers whenever it’s needed. In this light, a distributed company can appear to be much larger than it actually is just because two or three people will always be there to answer the proverbial phone (or respond to the email).
7. You can look forward to exciting team get-togethers
Just because your team is distributed doesn’t mean that you never have the opportunity to hang out with them in real life.
Zapier, for example, is a SaaS company that has workers distributed all across the globe. Twice a year, the company has summits that all workers attend. After getting to know someone digitally, employees get to meet their colleagues in the flesh. These summits are events that workers look forward to all year long. To date, Zapier’s team has been on retreats in California, Alabama, Utah, Texas, Washington, and Colorado, among other places.
So in addition to getting to meet the people you collaborate with online, distributed teams that hold company-wide summits get to travel to a lot of interesting places they might otherwise never visit.
Doesn’t sound too bad now, does it?
Here’s Why Bitcoin Won’t Replace Gold So Easily
What a week it was.
First and foremost, I’d like to acknowledge the horrific mass shooting that occurred in Las Vegas, the deadliest in modern American history. On behalf of everyone at U.S. Global Investors, I extend my sincerest and most heartfelt condolences to the victims and their families.
The memory of the shooting was still fresh in people’s minds during last Tuesday’s Hollywood premiere of Blade Runner 2049, which nixed the usual red carpet and other glitz in light of the tragedy. Before the film, producers shared poignant words, saying that in times such as these, the arts are crucial now more than ever.
I had the distinct privilege to attend the premiere. My good friend Frank Giustra, whose production company Thunderbird Entertainment owns a stake in the Blade Runner franchise, was kind enough to invite me along. Despite the somber mood—a pivotal scene in the film even takes place in an irradiated Las Vegas—I thought Blade Runner 2049 was spectacular. Even if you’re not a fan of the original 1982 film, it’s still worth experiencing in theaters. Hans Zimmer and Benjamin Wallfisch’s synth-heavy score is especially haunting.
CNET recently published an interesting piece examining the accuracy of future tech as depicted in the original Blade Runner, from androids to flying cars to off-world travel read the article here.
Still in the Early Innings of Cryptocurrencies
Speaking of the future, I spoke on the topic of the blockchain last week at the Subscriber Investment Summit in Vancouver. My presentation focused on the future of mining—not just of gold and precious metals but also cryptocurrencies.
Believe it or not, there are upwards of 2,100 digital currencies being traded in the world right now, with a combined market cap of nearly $150 billion, according to Coinranking.com.
Obviously not all of these cryptos will survive. We’re still in the early innings. Last month I compared this exciting new digital world to the earliest days of the dotcom era, and just as there were winners and losers then, so too will there be winners and losers today. Although bitcoin and Ethereum appear to be the frontrunners right now, recall that only 20 years ago AOL and Yahoo! were poised to dominate the internet. How times have changed!
It will be interesting to see which coins emerge as the “Amazon” and “Google” of cryptocurrencies.
For now, Ethereum has some huge backers. The Enterprise Ethereum Alliance (EEA), according to its website, seeks to “learn from and build upon the only smart contract supporting blockchain currently running in real-world production—Ethereum.” The EEA includes several big-name financial and tech firms such as Credit Suisse, Intel, Microsoft and JPMorgan Chase, whose own CEO, Jamie Dimon, knocked cryptos a couple of weeks ago.
To learn more about the blockchain and cryptocurrencies, watch this engaging two-minute video.
Will Bitcoin Replace Gold?
Lately I’ve been seeing more and more headlines asking whether cryptos are “killing” gold. Would the gold price be higher today if massive amounts of money weren’t flowing into bitcoin? Both assets, after all, are sometimes favored as safe havens. They’re decentralized and accepted all over the world, 24 hours a day. Transactions are anonymous. Supply is limited.
But I don’t think for a second that cryptocurrencies will ever replace gold, for a number of reasons. For one, cryptos are strictly forms of currency, whereas gold has many other time-tested applications, from jewelry to dentistry to electronics.
Unlike cryptos, gold doesn’t require electricity to trade. This makes it especially useful in situations such as hurricane-ravished Puerto Rico, where 95 percent of people are reportedly still without power. Right now the island’s economy is cash-only. If you have gold jewelry or coins, they can be converted into cash—all without electricity or WiFi.
Finally, gold remains one of the most liquid assets, traded daily in well-established exchanges all around the globe. Every day, some £13.8 billion, or $18 billion, worth of physical gold are traded in London alone, according to the London Bullion Market Association (LBMA). The cryptocurrency market, although expanding rapidly, is not quite there yet.
I will admit, though, that bitcoin is energizing some investors, especially millennials, in ways that gold might have a hard time doing. The proof is all over the internet. You can find a number of TED Talks on bitcoin, cryptocurrencies and the blockchain, but to my knowledge, none is available on gold investing. YouTube is likewise bursting at the seams with videos on cryptos.
Bitcoin is up 350 percent for the year, Ethereum an unbelievable 3,600 percent. Gold, meanwhile, is up around 10 percent. Producers, as measured by the NYSE Arca Gold Miners Index, have gained 11.5 percent in 2017, 23 percent since its 52-week low in December 2016.
Look Past the Negativity to Find the Good News
The news is filled with negative headlines, and sometimes it’s challenging to stay positive. Take Friday’s jobs report. It showed that the U.S. lost 33,000 jobs in September, the first month in seven years that this happened. A weak report was expected because of Hurricane Irma, but no one could have guessed the losses would be this deep.
The jobs report wasn’t all bad news, however. For one, the decline is very likely temporary. Beyond that, a record 4.88 million Americans who were previously sitting out of the labor force found work last month. This helped the unemployment rate fall to 4.2 percent, a 16-year low.
There’s more that supports a stronger U.S. economy. As I shared with you last week, the Manufacturing ISM Purchasing Managers’ Index (PMI) rose to a 13-year high in September, indicating rapid expansion in the manufacturing industry. Factory orders were up during the month. Auto sales were up. Oil has stayed in the relatively low $50-a-barrel range, which is good for transportation and industrials, especially airlines. Small-cap stocks, as measured by the Russell 2000 Index, continue to climb above their 50-day and 200-day moving averages as excitement over tax reform intensifies.
These are among the reasons why I remain bullish.
One final note: Speaking on tax reform, Warren Buffett told CNBC last week that he’s waiting to sell assets until he knows the plan will go through. “I would feel kind of silly if I realized $1 billion worth of gains and paid $350 million in tax on it if I just waited a few months and would have paid $250 million,” he said.
It’s a fair comment, and I imagine other like-minded, forward-thinking investors, buyers and sellers will also wait to make huge transactions if they can help it. Tax reform isn’t a done deal, but I think it has a much better chance of being signed into law than a health care overhaul.
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