What Kind of Company Is Coinbase?
On Sunday, the CEO and co-founder of Coinbase posted an article on the company blog called “Coinbase is a mission-focused company”. I heard about it from a friend, who sent me the link along with a message that only said “…”
What could it be? I started to read:
There have been a lot of difficult events in the world this year: a global pandemic, shelter in place, social unrest, widespread protests and riots, and west coast wildfires. On top of that we have a contentious U.S. election on the horizon.
I think I’m following so far: halting global warming, adapting to a viral world, and ending white supremacy … these are all missions that 2020 is showing the urgency of.
I’m sure people at Coinbase have ideas about how they can contribute to that; I wondered, is that what this post is about, how those challenges relate to the Coinbase “mission”?
I read on:
Everyone is asking the question about how companies should engage in broader societal issues during these difficult times, while keeping their teams united and focused on the mission.
Huh. I have found it only natural for my team to not be “focused” on the same things they were last year. I’ve been much more worried about how little tech companies have changed course or rethought their purpose.
Our industry has already long focused on shipping as fast as we could, and scaling as big as we could, ignoring the “external” societal issues our work inflamed. We said we wanted to “change the world”, and maybe we should’ve learned more about it first.
But I’m afraid those aren’t the challenges this post was about. I read on:
Coinbase has had its own challenges here, including employee walkouts.
I didn’t know Coinbase was having employee walkouts. What are employees challenging with these walkouts; what are they objecting to?
The day after I read the post, I came across a Twitter thread by Erica Joy that tells at least some of that story. It’s context I wish I’d had when first reading Brian Armstrong’s post about “difficult times” at Coinbase, and I’m going to reprint it here almost verbatim:
so let's start back in june. in the wake of the horrendous murder of george floyd, companies were doing their white text on black background “standing with the Black community” statements. even google, who had been mum on racism for their entire existence, said something.
you know what’s coming next. coinbase did not release one of these statements. the only hint at support of Black lives, or even the Black community, was the coinbase twitter account retweeting [this tweet] from brian [where he says “Black Lives Matter”].
now you may read that tweet and the following thread and think how did the person who wrote that thread also write this blog post. i’ll tell you how: he had no choice but to post* that thread. […]
why do i think he had no choice? well, something happened at coinbase that likely forced his hand: a large portion of the coinbase engineering team walked off the job just before that thread went up because brian wouldn’t say “black lives matter.”
now i said “post” because i don’t think he wrote that thread. i’d bet my paycheck on it. i strongly believe he posted the thread that a (crisis?) comms person wrote for him so his engineering team would get back to work. the blog post is more reflective of his true feelings.
i believe having his hand forced by that walkoff pissed him off and he’s retaliating: with the blog post, with the policy changes, and the other internal coinbase changes (slack channels for asking execs questions have been deleted, all hands questions must now be pre-vetted).
This is why I’ve been much more worried about how little change we’ve seen in tech companies, than worried our recent discussions are too “disruptive”.
Remember when we were proud of the word “disruption”? Proud of the stodgy, bloated incumbents we would sweep aside, and unleash whole tides of human creativity and ingenuity?
Why is it so hard to look in the mirror, and see who we’ve become?
But one thing tech companies still do very well is find gaps in the market, and fill them. Capital abhors a vacuum.
I decided to share publicly how I’m addressing this in case it helps others navigate a path through these challenging times.
Put that Twitter thread aside for a moment, and think about what you would see if you read Brian’s post without knowing the story of the “this” he was “addressing”. (Perhaps you already have.)
With this post, Coinbase is differentiating itself in the ever-hot employment market for software engineers. They’re going after a more specific market segment who they think they can appeal to the strongest, and discouraging people who don’t fit that mold from applying in the first place.
I’m not speculating; the very last sentence of Brian’s post is literally:
If you want to work at a company like this, please check out our careers page.
So what does he mean by “a company like this”? I think it’s worth taking a detailed look at the picture he paints, how he chooses to sell this idea of “mission-focused” Coinbase. It’s a cleverly-assembled package, and like any clever argument, its most dangerous aspects are its kernels of truth.
“Focus on building”
Personally, I found Brian’s stance most compelling in this section, where he points out a plain truth: no one can do everything.
There are many places that a company can choose to allocate its limited time and resources. There is never enough time to do everything, so companies need to choose what change they want to see in the world and focus there. It can take decades to move the needle on large global challenges.
I feel this — there is so much about our world that needs urgent care. If you try to take it all on, it’s overwhelming. To make progress somewhere, and to spare our sanities, we must commit and focus.
But picking a focus area doesn’t absolve you of the responsibility to know your place within the whole, to see your actions in context. It is just as treacherous to focus in too closely as it is futile to remain unfocused.
The vast majority of the impact we have will be from the products we create, which are used by millions of people.
I agree that working to shape Coinbase is a better use of employees’ energies and creativity than arguing on Slack — and I’m sure they feel the same.
“What is the scope of our mission?”
But perhaps the employees who are most vocal are not distracted from the mission at all. I wonder instead if they have some of the best understanding of the potential scope and impact of Coinbase. As Brian put it himself:
Coinbase’s mission is to create an open financial system for the world. This means we want to use cryptocurrency to bring economic freedom to people all over the world.
I’ve gotta say, the tech industry really grew up in the 2010’s. We used to be excited about disrupting phone books—now we talk about disrupting the exclusive domains of nation-states.
And that’s what an “open financial system for the world” would be. The whole appeal of cryptocurrency (as I understand it) is that it can be deemed to have value without relying on physical scarcity (like gold) or on human authority (like the dollar). Whatever your opinion of your government or legislators, you definitely can’t call your representative and get them to change Bitcoin.
But in this same post, Brian also wrote:
We are an intense culture and we are an apolitical culture.
When you play at statecraft, you are inherently political. Which leads me to wonder, what could be the goal of cultivating an “apolitical culture” at a company so brazenly and explicitly political? What could that accomplish?
“Why are we mission-focused?”
I’m not a journalist, but I’ve interviewed dozens and dozens of software engineers in my career, as part of the hiring process at the tech companies where I’ve worked.
A standard session would be an hour, just me and a candidate engineer alone in a room (or Zoom). I spend 5–10 minutes breaking the ice and chatting about their background, we spend 40–45 solving a (contrived) coding problem, and then I leave the last ten minutes for the candidate to ask me their own questions about the company.
You can learn a lot about the candidate in those ten minutes — and you have to, because it’s the only unstructured time where you can just sit and talk as fellow humans. Sometimes the only question people ask is, “I didn’t get it, did I?” and then I try to give what comfort and guidance I can.
Mostly, people use the time as a chance to get candid answers to questions about the company; they ask some form of, “what’s it really like?” What is the day-to-day work like, how are the people, what does the business actually do, what are the challenges it faces, and where is it all headed?
But sometimes I would interview an engineer who would use that time very differently: they would only ask me about the computers. How big is our fleet of servers, how much data do we have, and what are the coolest tools we use? Often, these didn’t fill ten minutes, since they largely have factual answers that aren’t fertile for further discussion.
So I’d try to fill the time, “do you want me to talk more about the team? or the company, or day-to-day life?” Sometimes they would just say no; more often they’d hesitate, say “sure”, but not really listen to what I said. “No, ma’am, I’m just here for the computers.”
There’s nothing wrong with wanting to solve interesting technical problems. But I often left those sessions with a nagging thought, “they really don’t care what the code is used for? or what kind of people work here?”
What kind of environment would a person like that excel in? What kind of boss would be excited to hire them?
“Play as a championship team”
During difficult times I think it’s important to go back to the guideposts we’ve established […] One of the tenets of the Coinbase culture doc is to play like a championship team. What does this mean?
Sports metaphors seem to be irresistible for business leaders, but I have a contrarian take: I don’t think they’re a good fit for discussing business.
Sports are fun exactly because there’s no inherent point to the game you’re playing. They’re a break from our complex lives and uncertain choices, a place to let go and just give it your all, to show what you can do and feel all the way alive.
Team sports are their own thing. When you have a team that really “gels” together, it’s because you’ve stopped thinking as individuals, and entered a shared state of flow. It’s a powerful experience, to lose yourself in the pursuit.
But a business isn’t a game. A business is doing something real. The point of a game is to forget the world, but the point of a business is to sculpt the world. Why are we tempted to think about them the same way?
When you see Brian’s post on social media, this is the teaser image you see. A map highlighting the “uneven distribution” of “economic freedom”.
How did this map get that way? Why are there no blue countries in Africa?
Well, I’m no expert, but I’ve read a couple of books, and I’ll try to summarize. Sapiens were born in Africa. Restless, we wandered, we went everywhere our feet would take us. Bit by bit, step by step, we filled the lands of the world.
But as anyone who’s played Risk knows, some regions are easier to control than others. Europe eventually developed a few separate kingdoms of roughly equal size, with natural barriers between them. The kings proceeded to make centuries of war on each other, devastating their peoples, and stunting their development, with none ever gaining a final upper hand.
The main thing these wasteful rulers did consistently develop was their military strategy and technology. Eventually, one of them was persuaded on an audacious idea: to take the company global, find new people to plunder.
And that’s how we got the map. We didn’t know it when we came back home. We didn’t throw a reunion. We cast a net.
We will keep building the most trusted and easy to use financial products that help people access the cryptoeconomy, so everyone can get the benefits of this new technology and we can bring more economic freedom to the world.
It matters how you define concepts like “economic freedom”. Whose freedom? To do what?
To elaborate, Brian linked to another blog post he wrote in 2016:
Economic freedom is a measure of how easy it is for members of a society to participate in the economy. It has a number of factors, such as:
How easy it is to start a business, whether property rights are enforced (can you keep what belongs to you), free trade with other nations, regulation of labor and business, stability of the currency, etc.
I unfortunately don’t have the time or space here to give a full account of the history, but suffice it to say — this definition of “freedom” is exactly the same one that produced that map.
As if to underscore the point, the data source Brian uses at his “apolitical” company to rank countries by their “economic freedom” are published by the Heritage Foundation and Wall Street Journal.
These are difficult times, and every CEO I know is trying to figure out how to lead through it.
I would say that if there’s a single message of these “difficult times”, it would be for “every CEO” to stop trying to “figure out how to lead” — to take a step back, to listen, and follow a better path than you can presently imagine.
I recognize that our approach is not for everyone, and may be controversial.
Your approach isn’t “controversial”, it is profoundly unwise.
For a corporation whose own stated goal is to create a new economic order, it is dangerous beyond description, and must be opposed.
We’re also committed to making Coinbase a place that creates incredible job opportunities and a welcoming environment for people of every age, race, gender, sexual orientation, etc.
Ha! I suppose that’s true; when you set such a strict ideological filter, you can eliminate all the others.
With a strong, united culture, we can build a company that changes the world.
Here’s a thought experiment: replace “company” with “country” in the above sentence. Now imagine it being said by a man with a platform in the 1930’s, a period of widespread desolation and despair much like our own.
Which of those “apolitical” leaders were emphasizing a “strong, united culture” in their speeches? Who highlighted the innate appeal of an end to political squabbling, and the thrill of mass coordinated action, the ultimate championship team, spreading your vision and image around the world?
America came closer to embracing fascism last time than our history books have seen fit to tell us. Louisiana was a fascist state for half of the 1930’s, under de facto dictator Huey Long. He was wildly popular, and could have gone on to become president, if he hadn’t been assassinated in the state capitol.
Last time, we relied on the Empire of Japan to definitively turn the tide, and make it taboo to be an American citizen who supports fascists.
Who is going to make it taboo today?
disclosure: I am a principal software engineer at Medium. Coinbase publishes their company blog on Medium’s platform. Code that I wrote helps transmit both Brian’s words and mine, but I write this as me, not on behalf of the company.
Brian, I don’t think your ideology should be welcome in the “marketplace of ideas”. But I wouldn’t dream of deleting your post. I love that you’re willing to show yourself. And Congress must also subpoena your directors.