Basecamp gained more customers than they lost during the controversy

  1. 29

    This news doesn't surprise me. We live in a world where polarisation is the default.

    I would propose that today you could do or say basically anything and the amount of people who swarm to your "side" would be directly correlated to the number of people you piss off on the other "side".

    As an overtly simplistic example, basecamp could come out and say that they're only going to sell carrots in their staff canteens, because they believe carrots are the best vegetables ever (I told you this example was overtly simplistic). This would lead to "carrotgate" and people who hated carrots and/or felt this was offensive to other vegetables would leave and cause an uproar.

    However all the carrot loving people... all the true believers, would flock to basecamp and rally behind their cause.


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      Yeah, really no surprise. Also, I think most people just don't care. There's a reason we talk about the vocal minority.

      1. 1

        between 30-50% of employee left :)) that's a pretty significant minority

        1. 3

          Nah, was mostly talking about customers.

          But even regarding employees, 30-50% is a minority compared to the addressable market—for every person that leaves, there's at least a hundred others that don't care and would willingly join the company.

    2. 4

      Yes, this is a good point.

      Polarization is the default in today's world.

      And depending on demographics, you could be mired in a "controversy" for which something a vocal minority is offended by but a silent majority is okay with or even supportive of.

      Also sometimes those who talk most do least.

      In some cases, the most vocal have the least direct impact on the bottom line.

    3. 2

      my point is you should gradually introduce carrot-based foods, not host a company TownHall to announce the change to carrots effective immediately and ripping any other foods from the fridges. The point is not to choose one or the other, the point is to manage such issues with experience and not like a damn toddler throwing a tantrum...

      1. 3

        To be fair, I think Jason was pretty open with regret for how it all went down. I totally agree that this whole saga was a poor showing of leadership by Jason and DHH. That being said, I also have confidence that they both learned a lot from this situation.

        I think overall it's an example of a downside of Building in Public - your mistakes are magnified, especially when you are at the level of popularity/notoriety that Basecamp is.

      2. 2

        It seems there was already too much pressure built up for that. I guess the lesson is to step in early and prevent problems, instead of waiting until they explode.

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        It's the opposite - they want people who aren't die hard culty about anything and treat a job like a job.

        1. 2

          Agreed, there's a time and place for everything.

  2. 23

    I run a ton of Founder Groups where we have super intimate conversations about what Founders go through. I've brought this topic up in all of them, with Founders all around the world and every gender/race/background you could engage and the consistent response has been - they did the right thing.

    Now, tbh, that's not what I was expecting. Also, it's not the approach I would have taken. But behind closed doors, I'm seeing 90% of Founders agree with what they did while Twitter feels very differently.

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      They did the right thing. IMHo workplace is not the place to talk politics and create hatred. It should spread positive vibe and friendships.

      1. 9

        In the time of my parents, you kept your mouth shut about politics. That way none of the other party could put you in a bad position.

        There is a reason why voting happens in private. Leave politics to the politicians, you're not going to convince anyone.

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          Yes. Nobody is going to win in political debate everyone have their own justification .

      2. 1

        "talk politics and create hatred" - Why are these things connected?

        Mature adults can talk politics - and even disagree - without it being a negative experience. This really annoys me like it's just seen by many people these days that mature disagreement whilst still being friends, isn't possible.

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          Nah I think modern politics is designed to stimulate outrage. And even if you disagree with that, while some people are okay with principled non-emotional disagreement, a lot of people just don't operate that way

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            On top of this, the 'politics' they banned was not some esoteric discussion of monetary policy, it was claims such as "seniority based profit sharing is racist and enforces a system of white supremacy". How is it possible to have a mature adult discussion of stuff like this when just taking the counter stance causes you to be labeled as a bigot? Seems like a minefield best left avoided at work.

        2. 1

          You may be able to do that but not many. And for thing which is not in our control(Others behavior) how can we 100% says that we can debate in politics without hatred?

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            1. 1

              Can you tell me what is the purpose of political discussion and what you expect the outcome to be ?

              1. 0

                “What do you think of that policy?”

                “What do you think of this policy?”

                “What do you think the real world effect might be if this policy comes into play? I think this will happen.”

                “Oh really? I disagree I think this will be the real world effect”

                “Interesting that you think that… I guess we’ll see”

                Etc etc etc

                I think it’s utterly depressing that you can’t imagine a conversation being anything other that a debate or an argument that you need to “win”. Honestly so f*cking sad.

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                    The post itself show how provokingly you replied. I was saying from my last 10 year of working experience in a politically driven organization. It may be different for you or your kind of environment. That doesn't implies that what you said is right or what i said is wrong.
                    When you don't have control over what others say or act, you are yet to figure out how can you 100% agree that it will not bring toxic culture and conversation. See for example about this conversation. You are just arguing without being rewarded for anything. and same does applies for that too!

                    1. 0

                      Have a great weekend 👍

    2. 2

      @wilschroter - I agree it's the right thing to expect official internal channels to be a place to get work done. But as both a founder and someone sensitive to issues of race etc. my take is that they did this for the wrong reasons (from the outside it seems much of the pushback against the reckoning some employees were pushing for was coming from the founders themselves - it doesn't seem like a debate between employees they were stopping but a debate between employees and the founders themselves) and more importantly they did this far too late (the right time to enforce internal channels be used to get work done would have been the first time the "Best Names Ever" list was sent around which was over ten years ago) "Haha funny but let's not make fun of our own customers" is all it would have taken to focus internal channels on work and to remember who customer support actually works for (the customer) when the list was probably still focused on names American parents should have known better about naming their kids.

      I also think there is something about the fact that they've been a remote-first company for years that plays into how they let something so manageable get so polarized and out of hand. Something we founders need to think about especially with the renewed push to keep things remote post covid.

      Anyway I felt compelled to get my thoughts out from a founder's (and personal) perspective so I wrote a post going through these and a few other points. But I have to say that any founder saying that a third of your workforce quitting on a single day (when you have more than 3 employees) can be the result of doing the "right thing" is not looking at it from a position of management efficacy. And they are not acknowledging that the issue did not have to be so black and white (no pun intended) and could have been resolved without all the drama.

  3. 21

    Honestly, I think people have been hitting the "cancel button" on Basecamp a bit too hard.

    Yeah, you might not agree with their new policies, that's fine. They were more than generous with the employees that left over it. At the end of the day, it's their company - many other companies put similar policies in place and the only reason they aren't cancelled is because they aren't willing to risk being as public about it.

    These guys have done a lot of good for the tech ecosystem so I'm glad to hear they are doing well and hope they survive. In time they might change their policies and become "Twitter darlings" again but I'm kinda glad to see that it doesn't matter to them that much.

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      hey were more than generous with the employees that left over it.

      Exactly. It felt a bit weird to me seeing all those tweets. Felt like virtue signaling. Not one of them mentioned the extremely royal compensation they got as they left. Everyone framed it as "look at how brave I am, leaving over this" while conveniently leaving out the massive compensation.

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        The amount of tweets along the lines of 'wow what brave people let's all show support for them' was ridiculous. Offer me 6 months salary and I'd leave my job I'm very happy at knowing I can walk into another one.

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          I think you've encapsulated how many people feel. This is probably an instance of a loud minority creating a misrepresentation causing availability bias.

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            I was too very surprised that even despite disagreements none of them said any kind words in their public tweets. Really? Spent years at a great place, earned ton of money, and taking a raincheck. No single thank you?

  4. 18

    I'm actually really impressed with the relatively nuanced response the IH community (at least based on the comments) has about this issue. Twitter is the opposite with screaming/cancelling divas.

    It's also probably because we understand the trials of founding and running a company and are more empathetic to someone who does that and 'builds cool shit' rather than an entitled employee who just wants to complain.

    1. 2

      Or alternatively fewer people actually read what Jason wrote:

      We don't have to solve deep social problems, chime in publicly whenever the world requests our opinion on the major issues of the day, or get behind one movement or another with time or treasure.

      Its basically a bad corporation manifesto. Corporations have won from the supreme court all the rights of citizens and now here's Jason publicly claiming they should not get bogged down in any of the responsibilities of a citizen.

      1. 8

        They can do whatever they want. It's their baby. If you join a company the only agreement you have with them is that in exchange for your time and efforts you will be monetarily rewarded.
        Take the self righteous act away from the work place and do whatever you want on your own time. And if that's not ok with you then go someplace else.

        1. 0

          If your argument is that there are no repercussions for a CEO saying or doing the wrong thing then you maybe are living in a different century from the one I am in. And I'm not even sure what century because there are universities, buildings and hospital wings all over from long ago captains of industries trying to better their reputations.

  5. 17

    Promoting politics at work is not inclusive. Basecamp made the right decision. It has become fashionable for companies to take political stances. Basecamp now realizes that doing so ensures you alienate roughly half of your employees, potential employees, and customers.
    Political discussions can still happen in regular channels. It is just not the company's purpose.
    Basecamp will be just fine. I am glad they stuck to their original decision. I anticipate that more companies will follow suit.

  6. 9

    I'm not sure that's the right metric to determine whether it was the right decision or not.

    By all accounts they lost several long time employees over the view that they failed to listen to the concerns of people on their team, and were ultimately too heavy handed in their approach.

    But at the end of the day this was an internal company policy - its not like they went and posted a bunch of racist or homophobic tweets on Twitter.

    If Basecamp decides to cancel casual fridays, catered lunches, and unlimited PTO - and then a bunch of employees decide to leave because its not a fun place to work anymore - I wouldn't expect them to lose any customers over it, but that doesn't really determine whether the decision was "right" or wrong.

    I mean, I am pretty empathic to Basecamp's position in this. Political discussions in the workplace can be absolutely toxic. But when a third of your workforce heads for the door, my sense is that you probably fucked up. Seems like they could have gotten the results they wanted with a softer approach - for example sending out a memo "discouraging" political discussion, raising the issue at an internal meetings, etc.

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      Yes no one writes PR pieces like this about good decisions.

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        I agree, I don't think they should be using that as a metric.... I also don't think it's something to flaunt about after everything that went down.

  7. 8

    So much for rule #4: "No more lingering or dwelling on past decisions."

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  8. 8

    The average customer really doesn't care (There is definitely a shift occurring https://hbr.org/2020/02/how-do-consumers-feel-when-companies-get-political, but the average and majority with capital to spend still don't).

    If the company solves the problem better than other companies, then they'll move on with life. There's so much news and stimuli nowadays that it's likely Basecamp making these changes hadn't reached as far and wide as tech news claimed it to be, or was buried under the other things occurring the world.

    A lot of what this comes down to is messaging. People are mad at Basecamp for implementing terms about their work publicly (regardless if you like or dislike what they've set down), but then are complicit in companies that are literally engaging in the use of slave labor and unethical sourcing/selling (Apple, Facebook, Nike, Adidas, Coca-Cola, Nestle Company).






    The difference is how many degrees of separation that makes us feel, how the news traveled, and how mature their PR teams are.

  9. 7

    Yeah, but they also lost a lot of good employees ;) And part of the ones who stayed might have stayed because they needed the paycheck and couldn't jump out just out of privilege...

    So overall I would say a pretty shitty deal, a stressful time, a huge morale issue and a scar on the image that they spent years on the building. Was it worth it just for a flex? Couldn't they have gradually introduced these policies and evaluate how things are perceived?

    My own opinion is ofc you shouldn't talk politics at work, but also this was a very poorly executed move.

    1. 5

      The last time they announced open positions--before the controversy--they had 1,200 applicants. In this tech-hiring economy.
      Increasingly I'm coming to believe three things:

      1. 20% rabid fans is much, much better than 70% meh, okay's.
      2. This is what's killing corporations and making small, nimble companies flourish. At scale, you can't do this--or they believe you can't.
      3. Like everything else in life, base your opinions not on logic, "first principles", or "common sense." Base them on data.
      4. (bonus observation) I'm seeing this personally more and more. Plenty of people disagree with me...but see 1)
    2. 5

      Exactly. The controversy never involved customers, it was about employees. If there is an impact to losing 1/3 of the team it will show over the next year.

      1. 0

        Infact they will do better as they will get new people on the board with fresh mind and ideas. There are numerous places out there to talk politics and social issues and fight for it. If they really want to change the world, why should they join basecamp? They should join some NGO whose mission itself is fighting for the better.

    3. 1

      Every one out will be replaceable. For time being they may suffer for a short term. I'm saying this after working in a politically driven organization for a decade. They did the right thing .

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        you can recover from almost anything, but it still means that you could have been ahead if you wouldn't have suffered that setback. Hiring and training ppl is expensive, they acted in an extreme manner which is also what they were blaming to begin with. I 100% agree with them, just not with how it was done. We never discuss politics, sex, religion at work - everyone knows that in Europe at least...

        1. 0

          I agree with what you said, it may cause short term issue. But they will be filled with more vibrant young and fresh mind which is better.

  10. 4

    I think people are being too hard on DHH & JF as managers.

    Don’t get me wrong. Losing a third of your employees is terrible. Operations-wise, morale-wise and PR-wise. It’s a pretty damning indictment of the management team. There’s no way to trivialize that.

    Two points are worth mentioning though:

    1. The average tenures of the employees who departed (at least as informally stated on twitter) was like 5 years or so. Many of the devs had been there for much longer. These were very high demand employees in a hot tech market. Management must have been doing something right to keep them all that long (w/o equity dreams as a carrot either!).

    2. The package they offered to disagreeing employees was very generous. They refused to pay lip service to ideas they disagreed with, but they supported their team in a much more difficult way - with $$$.

    Considering these two facts, one gets the sense of a management team that did and had done right by their employees for many years.

    Frankly, I don’t know how to reconcile that with a 1/3 walk out. But I know that these points shouldn’t be ignored when framing the total picture of what happened.

  11. 3

    Lol, this entire comment section is a prime example of why politics should not be discussed.

    Imagine seeing some of this shit in a Slack channel! Half the comments here have already created a sense of animosity with you and your fellow Indie Hackers because of conflicting opinions.

  12. 3

    Big congrats to Basecamp. That's the beauty of free market capitalism. Clients vote with their dollars. No one cares that a 2 headed, 3 legged martian provided the service so long as it is done to a high quality level, on time, and affordably. That's what too many don't get.

  13. 3

    capitalism continues on.

  14. 3

    "The best revenge is living well"

  15. 2

    If I worked at Basecamp, I would probably have left if they didn't curtail political discussions in the main work channel that I couldn't avoid.

    I'm from Northern Ireland, so politics is a heavy subject for me (as it is in many places) and it's been an unspoken rule for a long time to avoid political discussions in the work place. I generally I try to avoid them in general unless it's with someone who I know well and were we can both leave the discussion feeling good.

    Logging into my work comms and having to read through heavy political discussions would cause too much anxiety and prohibit me from doing any work, so I'd rather those discussions were moved to a dedicated channel where people could choose to get involved or not.

    Which is from my understanding what Basecamp did - they asked for the discussions to be moved to Whatsapp, Facebook etc instead of the main company Basecamp account. They just managed and communicated it extremely poorly.

  16. 2

    Imgur @channingallen there seem to be two versions of the title for this re-post on IH and the one that says the "controversy led to a net gain in customers" isn't based on anything in Hansson's original post. He implies causality between the controversy and a "small uptick in cancelations for HEY during the first tumultuous week." But the fact that this was offset by "new customer signups for Basecamp" isn't itself tied to the controversy by anything Hannson writes. This makes sense because individuals can sign up for HEY's email service (and individuals can quit if they are offended by the company behind it) whereas Basecamp (the product - as the company is also eponymously Basecamp) is by definition for company teams where decisions are usually made based on the value the service offers and where cancellation would take time (to find and migrate to an alternative etc) even if politically motivated.

    In the end Hansson's post speaks to the power of new customer growth. He certainly implies some gross churn because of the controversy (i.e. some customers left because of it) and because his company's revenue isn't really tied to upselling existing customers (e.g. the Basecamp product costs a flat rate with no per user increase) this implies a net churn as well (based on lost revenue minus upsells). In the end he's saying this gross/net churn was made up (in terms of net revenue) by growth: "both products are growing like they were before that difficult week." If people read the alternative title for this post on IH without actually reading Hansson's original post, they will certainly miss the point. Nothing there says the controversy itself led to more revenue post "storm". Everything says Basecamp's growth engine pushed through the storm and "weathered on".

    1. 2

      He implies causality between the controversy and a "small uptick in cancelations for HEY during the first tumultuous week." But the fact that this was offset by "new customer signups for Basecamp" isn't itself tied to the controversy by anything Hannson writes.

      He actually implies causality for both. But for some reason you left out the full quote (emphasis mine):

      While there was a small uptick in cancelations for HEY during the first tumultuous week, they were more than offset by an increase in new customer signups for Basecamp. And now both products are growing like they were before that difficult week.

      In context, it's clear he's saying there was "an increase" in new customer signups for Basecamp as well as an increase in cancelations for HEY. And now things are back to normal. Not just for HEY cancelations, but for new Basecamp signups.

      1. 2

        @channingallen thanks for the response. It's subtle but I think you missed an important distinction where he says "both products [were] growing ... before that difficult week." If both products were growing at some rate (he doesn't say that rate but the implication is it's positive growth), his mentioning that HEY's negative growth is correlated with the controversy only makes sense if he believes there could be causality between the controversy and the negative growth rate (perhaps he's seen feedback left by customers as to reason of cancellation to come to this conclusion).

        But the fact that the raw number of cancellations was offset by the raw number of new signups for the Basecamp product says nothing about whether the growth rate for Basecamp was affected. To be clear, depending on the growth rate for BaseCamp, it’s growth rate could have been negatively impacted during the period in question but still have a raw signup increase that offset the net cancellations for HEY. The subtle distinction is the difference between an increase in customers (signups minus cancellations) over the period vs the rate of increase (growth rate) over the period.

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          But the fact that the raw number of cancellations was offset by the raw number of new signups for the Basecamp product says nothing about whether the growth rate for Basecamp was affected. [emphasis added]

          I'm not sure why you keep leaving out the relevant details: "small uptick in cancelations" and "an increase in new customer signups."

          David doesn't compare the "raw number" of cancelations vs. the "raw number" of new signups. He compares the increase in Hey cancelations (he uses the term "uptick") vs. the increase in new Basecamp signups.

          He's saying both measures deviated upward from their baselines, and that the upward deviation of cancelations was offset by the upward deviation of new signups.

          And further that after the dramatic week, both measures returned to their pre-deviation baselines: "now both products are growing like they were before that difficult week."

          1. 1

            Hey Channing. I guess I read the "they" in "they were more than offset" to be "the cancelations" as the concept of rate of change is singular and would be referred to in the third person as "it" not "they".

            But all of this is in the weeds at this point. I didn't see any explicit statement of causation in the original piece (even if he implies the drama had an effect in one or both directions) so I wasn't expecting to see causation referenced in the title: led to.

            My takeaway is as you quoted "both products are growing like they were" which makes any change (even if causation was proven) insignificant.

            Either way thanks for doing what you do. I appreciate it and just thought the alternate title was a little over editorialized for space.

  17. 2

    I think a lot of commentary misses the point entirely. Their ex staff members on Twitter are NOT saying "I quit because I can't talk politics at work any more...". Most of them are saying they quit because the internal company culture had become untenable, and management's response to the employee pushback to the latest changes made it boil over.

    If you read the threads from employees, the post from Nathan K (who used to run Highrise for them), and even Casey's articles, you can see that there were years of toxicity brewing within the company, which mainly stemmed from David and Jason's avoidance of conflict or willingness to face difficult situations. (Why, even during the final meeting where everything blew up, David attended the remote session from his bed, and had his camera turned off, and didn't say more than a couple of sentences while his company poured their hearts out to management).

    Their management style seemed to lack emotional maturity, and they would often just let scenarios simmer away until they became too big to handle, and when they did become too big, they simply took the quick way out of shutting everything down rather than take serious steps to mitigate and solve the issue. THAT is why so many quit en masse.

    Take a look through their former (deaf) programmer George C's post - he speaks of not feeling comfortable or valued within the team for a number of years (partially due to his disability), and that these latest events were just the catalyst that made him pull the pin.

    I get it that managing employee conflict is one of the least favourite things about running a business - heck, I am as conflict averse as hell, but I know my limitations and I try to work on them to be better next time around. But from the sounds of the follow up posts, especially by David, they don't seem to have realised that the problem stems from the top.

    1. 2

      Exactly! I see this as a management efficacy issue. Everything you are saying is on point. The “politics” in question that they were looking to ban was internal politics. The founder or indie hacker mindset doesn’t seem to lead people to whine about issues like this (there is definitely a victim mentality that shows up on Twitter etc that you don’t seem to find here). But if we’re focused on building companies, however small, part of that is learning what good managers do. And this isn’t it!

  18. 2

    Nuance is truly dead, isn't it? Even in DHH's post, he referred to "the set of workplace policy changes". Changes plural. But no, it all has to be reduced to a single issue, or in fact, a single word.

    "Politics be bad. Not-politics be good. Remaining workers happy. QED"


  19. 1

    The smart thing to do for companies is to flush out politically minded employees like Basecamp did. This way you kill two birds with one stone. Employees that take political positions at work are usually employees that are bored at work, hence non-productive; so getting rid of them (especially via them quitting over ideological disagreements ) is the best case scenario for a company. The resulting controversy in turn provides free advertising, hence more customers. win-win.

  20. 1

    I’m not sure I agree with this headline.

    What was their previous growth rate?

  21. 1

    As long as they're making their policy public (within the company or external is irrelevant) and updating it as they receive new information, good for them. More companies should be transparent in how they think about their vision of the workplace. Keeps people productive if they can more easily pattern match for that type of thing, I imagine.

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      The post is written by DHH, one of the founders of Basecamp. He is CTO of Basecamp currently.

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