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Building Binance: Ultimate Efficiency with Basic Tools.

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Binance has proven that rapid growth and collaborative tools can be completely unrelated.

Original Title: "Manufacturing Binance: Extreme Efficiency and Simple Tools"

Original Author: Hanyang (@HanyangWang), Founder of AAAny

Less than 200 days after its establishment, Binance has become the world's largest blockchain exchange. Some founders see their company as a product that needs to be polished, but Binance has already taken off like a rocket without being polished. In a short period of time, the remote work team has grown from dozens to thousands of people. The rocket not only needs to fly higher, but also needs to consider how to avoid disintegration due to this complex collaboration model.

Before Binance, GitLab, an open-source software company with over 2,000 employees, was a model for remote work. The company wrote one of the most comprehensive remote work guides, "GitLab's Guide to All-Remote," which covers everything from how to work non-linearly to evaluating remote work results.

Today, there are more options for emerging companies than GitLab. The trend of remote work brought about by the epidemic has driven a large number of collaboration software growth: Zoom has over 800 million visitors per month, and the daily activity of Microsoft Teams has almost doubled within a year, increasing from 145 million in 2021 to 270 million in 2022. The collaboration tool Linear completed a $35 million Series B financing led by Accel in 2023. All founders understand one thing: if you want efficient remote collaboration, it's best not to skimp on investment in collaboration tools.

But Binance is an exception. It proves that there can be no relationship between rapid growth and collaborative tools. For a long time, all of Binance's management was based on group chats. If there was something to discuss, they would do it in the group chat. If there was something urgent, they would create a separate chat. All information was directly placed into online documents. In the face of rapid growth, all professionalism disappeared. In 2020, Binance supported a total trading volume of over 3 trillion US dollars through group chats and online documents.

From 0 to 30 trillion US dollars, all you may need is Telegram group chat and Google Docs.

Remote Collaboration

The previous article mainly discussed the Binance staff scattered around the world. What is curious is: how do these people collaborate? Does Binance have some unique work methods that allow it to rise quickly?

The simple answer is: Binance does have a unique way of working. Binance's unique way of working seems to not care about collaboration and management when it is growing at its highest speed. Since the hastily assembled rocket is still flying to the moon, there is no need to care about whether the assembly method is crude before it slows down.

Early on, Binance had an all-staff Telegram group chat. The chat was very flat, for example, if someone needed to design a poster, they would directly @ the relevant person in the group. After the responsible person completed the task, they would also directly post the results in the group. Almost all of the information for everyone was in this group. In other words, Binance's collaboration revolved around the all-staff group chat. If there were documents, they would generally be placed on Google Docs. Just like how Bezos at Amazon requires employees to write documents instead of slides, CZ also began to hope in 2019 that the entire company would use Google Docs for collaboration. Only presentations at large meetings could use slides.

I jokingly asked, "Aren't you afraid of information leakage to the US government who wants to sue Binance?" One of the interviewees replied, "Binance is directly running on AWS, so why would it be so troublesome to mess with it?"

除了全员大群，Binance 还有很多群，比如单独的华语群。大群里还是以英文为主，不过 Binance 员工说华语的不少，故也有很多基于微信的私下交流。也许用微信是个更方便的选择，但并不是没有风险的选择——微信可能在群聊会执行更严格对区块链话题的审核（私聊不受限制）。

And some urgent work will create a small group. If it's a product-related issue, developers will join, and in some cases, the legal team will also join the small group. After everyone is present, synchronize the matters and decide whether to schedule a meeting. Binance employees call it the "TG group collaboration mode" and believe that it is very efficient. Some employees said that at that time, Binance's group chat style was to "directly confront in the group chat, and whoever is right or wrong will say it in the group chat. Everyone believes that this is a good way to maintain efficiency. The unwritten rule is not to chat privately, and everything should be said in the group chat to maintain transparency."

A former employee joined Binance in 2019 and his first impression was "shocked": the whole company was too transparent, and it seemed to trust everyone, including new employees. At the first meeting, he learned about the product progress and next steps of each department. And there will be no situation where files cannot be accessed. This made him feel that "there is nothing difficult to promote"; under the instructions of CZ or He Yi, the required resources were immediately available and work began on the same day. Most excellent start-up companies can achieve transparency and strong execution in the early stages. But the situation of Binance may be more complicated: on the one hand, it is still a start-up company that has only been established for two years; on the other hand, Binance in 2019 has more than 40 countries or regions employees and serves more than 15 million users, making it the world's largest blockchain exchange. If viewed from the perspective of two years of establishment, Binance's transparency is not surprising at all; but in terms of scale, this transparency and execution are indeed not easy. Part of the body has become a giant, while the other part is still growing.

Although this group chat-based collaboration model may seem rudimentary, it does not mean it is convenient for slacking off. The vast majority of employees maintain an effective working time of 12-14 hours per day, and even "have to run two steps to go to the bathroom." They still have to work at 11 o'clock at night. If they cannot find anyone at "this time," they will be considered unsuitable.

As a rapidly growing company, the workload can be overwhelming for employees at times. The time that a Binance employee wakes up each day generally depends on the first meeting of the day and is closely related to the time zone in which they collaborate with others.

When someone starts working, the first daily meeting is usually at 10:30 AM in the GMT+8 time zone. Later, due to time differences, it became 9:30 AM and eventually 2:00 PM because the superior went to Dubai. Some people have to start the first meeting at 6:00 AM for cross-border collaboration. The daily meeting usually lasts for about half an hour. The day doesn't end until the daily report is sent out at 11:00 PM. For companies like Binance that have offices around the world, the most friendly time zones are usually Europe and Dubai. They are in the middle of different time zones and can take care of both the GMT+8 and US Pacific time zones, which is also where many people in Binance are located.

Because remote work does not involve commuting, and meals are also takeout, so most of the time from morning to night is actual work. Compared to this, 996 is not even an exaggeration. However, even with the efficiency of collaboration based on group chat, meetings cannot be avoided: any company with thousands of people scattered across the country needs to communicate with each other through a large number of meetings. Some people recall that their peak was to attend ten meetings a day, "I really didn't do anything all day, just attending meetings." Some small teams will control the frequency of meetings, striving to keep the number of meetings for grassroots employees within five per week. However, this is not the norm.

Perhaps because too many meetings affect work, but remote collaboration has to have meetings, so CZ and He Yi have very high efficiency requirements for meetings. In 2018, CZ directly taught employees how to make more efficient reports: by listing key points in text form to speed up the process. Unless there are special circumstances, meetings with him cannot exceed thirty minutes. Every quarter, CZ will do QBW (Quarterly Business Review) with business department heads: results, progress, challenges, and issues. Essentially, it is to quickly let him know if there is anything that needs higher-level assistance. Some people say, "If you don't mention the main point in the first sentence, CZ will definitely interrupt you."

The marketing department led by Heyi has been pursuing efficiency for a long time. As the most globalized department of Binance, the marketing department also has the highest demand for information synchronization. Every Wednesday night at 10 o'clock, the marketing department holds a weekly meeting with more than 100 core members attending, and each project leader has to speak. The speaker only has one page of slides and one minute to speak. The content of this page is very simple: the most important achievements and progress of the past week, what will be done next week, and whether there is any work that requires cooperation from others. For example, if there is an activity that requires translation support from various regions, it needs to be notified in advance. The meeting is short and efficient, and it can be concluded in about 40 minutes overall.

The issue of cross-cultural communication is also encountered at Binance. The Asian team is relatively less concerned about the difference between work and rest time compared to the European team, especially when it comes to remote work, which blurs this distinction even more. They can only adapt to each other. Most Binance employees would agree that it is a company that provides relatively little training, but it provides employees with $100 per month to learn English on a software called italk. CZ's habit of reading books also extends to the company. On its second anniversary, Binance gave each employee a customized Kindle e-book reader with a Binance shell, and there is also an allowance for buying books. He even held book clubs for managers.

For individuals, the greater concern may be the complete lack of offline remote work, which can cause people to lose connection with each other. Many people before working full-time remotely do not think this is a big deal. However, being alone every day without many real people to meet offline can make people crave more face-to-face communication over time.

Work Method

However, even under high pressure and intensity, Binance's growth rate continues to attract more people to join.

When Binance was first established, there was a window of opportunity for those who were interested to directly contact the founder and obtain an interview. The standard interview process at that time consisted of four rounds, including the direct supervisor, peers, colleagues, and HR, in addition to CZ or He Yi. At Binance, HR does not have veto power, which may make many programmers in large companies very happy. However, if you manage to find CZ or He Yi online and have your first interview with them, the other rounds are just a formality.

One interesting detail is that many people who joined Binance during this window period said that most of their conversations with CZ or He Yi during the interview were not related to work, but mainly about life, ideals, vision, or other "empty" things. After interviewing someone, CZ would even carefully share his passion and views on blockchain with the other person. Perhaps CZ and He Yi would agree with Sam Altman's view: value first, aptitude second, specific skill third.

At the beginning, employees were using their own computers. Later, for security reasons, new employees would be assigned a 13-inch Macbook Pro. Compared to other companies at the same time, Binance offers a slightly higher salary. Many people admit that if it weren't for joining Binance, they wouldn't be able to join a big company based on their education and experience; under normal circumstances, salaries wouldn't be too high. If you are willing to go to Dubai, the salary can be even higher and there will be subsidies every month. However, there is a big difference in treatment between different departments, with the contract department having the best treatment, followed by technology, and the marketing department having the lowest.

Binance has a review every six months. If you perform well, you can receive a bonus of 4-6 months' salary, but if you don't perform well, you will only receive a bonus of two months' salary. Therefore, many people can basically receive 20 salaries a year, which is very generous for most job seekers. This can be compared to Temu, which is still growing rapidly and can only offer candidates up to 14-16 salaries. However, later on, the review became once a year and the bonus was also reduced.

Good performance is reflected through scores. At Binance, employee performance is rated on a scale of 1-6. 1-1.5 is the best, reserved for superstars, with each team having at most one or none. Normal ratings are 2-3 or 3-4. Ratings below 5 will result in a performance improvement plan (PIP) with a one-month probation period. If performance does not improve, the employee may be let go (a euphemism for being fired). However, such cases are rare over a considerable period of time.

Each person's manager will be responsible for scoring, but convincing superiors (early on it was directly convincing CZ or He Yi) is necessary. He Yi used to check everyone's bonus in the early days. However, one humane aspect of Binance in the early days was that bonuses would take into account each person's basic salary. If the basic salary was low, more bonus would be given.

Regular employees usually have a probation period of 3-6 months, while executives may need 6-12 months or even longer. For positions that require team management, training is required to work as a customer service representative for two hours every day. This is a style that is common in Chinese internet companies, such as JD.com, which used to require every executive to work as a delivery person for half a day each year.

Once officially joining Binance, the only thing you need to do is to help this rapidly expanding company expand even more rapidly. Unlike many start-ups that burn money to gain market share, Binance is a money-making machine while expanding rapidly. Therefore, it will not be as strict in controlling ROI as unprofitable companies. For example, in the marketing department, only new business will be evaluated based on ROI, while branding, media, or community work will not be controlled. And KPIs will not be used for management, but rather OKRs will be used to develop plans, similar to large Silicon Valley companies.

超越规则

translates to

Transcend Rules

For Binance, as long as it doesn't hinder growth, everything can be put aside, including management.

For many founders, management is the most important thing. How should people collaborate with each other? Various collaboration software has emerged: Linear, Notion, Lark, Slack... From Silicon Valley to Beijing to Bangalore, entrepreneurs from different countries are discussing the same topic: what is the best management model (and programming language)? Management books are also displayed in airports around the world.

But Binance has shown a different path: When a company is experiencing epic growth, is it really necessary to care about management? As long as it doesn't hinder growth, what's wrong with being a company based on Telegram group chat?

Binance is not the only company that proves growth and management tools are irrelevant. China's e-commerce company Pinduoduo is also known for its rapid growth. According to a report by LatePost, Pinduoduo also had a QQ group of several thousand people for communication, and key tasks were basically passed on by word of mouth. Even when Pinduoduo went public in 2018 and its market value reached three to four billion US dollars, the administration was still exporting data from punch clocks and manually importing it into Excel spreadsheets for attendance records. A person who joined Pinduoduo after 2019 believes that "the use of primitive management methods stems from the fact that for Pinduoduo at that time, survival was the most important thing." The same goes for Binance, which not only needs to survive, but also needs to surpass all competitors and break through all obstacles to its regulation. If it is already difficult to survive, what tools are used for management is not important.

However, this does not mean that the conventional management mode is meaningless. Even Binance has felt the drawbacks of extensive growth as the number of employees gradually increases.

When the company approached nearly a thousand employees in the second half of 2020, Binance initiated its first migration. Telegram was gradually abandoned and everyone was moved to Cisco's WebEx. However, this was only a transition, and the ultimate destination was Binance's self-developed internal software, Wea.

If you have used Lark (Feishu), a software product produced by ByteDance, you will find that the two have a similar UI interface, and even the logos are similar. However, unlike the era of Telegram when everyone used the same software, Wea can only be provided to the Binance main team. Teams acquired by Binance, such as the Coinmarketcap team, cannot use Wea.

And this is also the beginning of Binance becoming less flat and transparent. For Binance, it is more important to ensure that employees do not leak information than to be transparent. In the Telegram era, the cost of being flat and transparent is that there have been many information leaks, and the installation of security software on computers is directly related to these problems. Since WebEx, Binance has canceled the all-staff group. And CZ does not allow colleagues to form large groups. However, there will still be some interest groups. These groups can only be maintained in small groups of dozens of people and cannot be larger. At the same time, some slightly larger WeChat groups of Binance employees have also been disbanded. From this time on, Binance employees can no longer contact each other at any time. Sometimes, two Binance employees who cooperate every day may meet for the first time through a third-party introduction. For example, they may recognize each other for the first time during a blockchain conference through an introduction by someone else.

It is not uncommon for companies to become very strict in controlling information, and the same happened to Pinduoduo, which once had a QQ group with thousands of members. "Employees cannot see the organizational structure or colleagues outside their department on the internal office system, nor are they allowed to create WeChat groups," the company has become very strict in controlling information.

Some employees have claimed that there are now two types of people within Binance: the old Binance employees and the big company employees.

Although big companies may not seem as crypto native, they may actually be more suitable for Binance now - after all, no matter how special, Binance will eventually encounter problems that many big companies will encounter. At this time, finding people who have seen such problems is obviously a better choice. These big company people have worked in giants, and even governments, and have seen great storms and have strong abilities. Many blockchain exchanges rise fast, but also collapse fast. Although Binance faces challenges, it still stands strong, and these newcomers have played a big role. There is a Chinese proverb: you can conquer a kingdom immediately, but you cannot govern it immediately. Since the second half of 2020, Binance has also shifted from crazy growth to normal growth.

Binance's challenges are not unique at all. Those internet companies that once experienced rapid growth have all encountered this problem. ByteDance early on employed a large number of young frontline employees who had no big company background but had enough motivation to push towards results. However, after 2020, ByteDance also began to look for more experienced managers in the market, such as former Didi Chuxing executive Chen Xi or former Xiaomi partner Zhou Shouzi.

Although it is inevitable to introduce employees from large companies, this has also caused complaints from old Binance employees: some people say that Binance never had upward management before 2020. But starting in 2022, everyone needs to do upward management. At the beginning, Binance, led by CZ and He Yi, only cared about one thing: user focus, creating value, and thinking from the user's perspective. But now, we also need to think about whether doing something will help the leaders? What credits can we get from the leaders to promote better?

All of this is probably not what CZ wants to see. He emphasized avoiding office politics, struggles, and encouraging cross-level communication during meetings before the epidemic. However, once a company becomes large, no one can completely avoid the problems that arise in large companies. The disease of large companies has no escape velocity and is a fate that all giants cannot avoid.

The growth rate of a company is often faster than the founder's learning speed in the short term. How big and how far a company can go depends on the founder's ability to catch up and adjust. Some companies are lucky enough to have founders with a wealth of experience even before the company was established. The founder of CATL, Zeng Yuqun, had gained a lot of experience through trial and error in his previous company, so he never mentioned learning from other companies' management at CATL. More founders choose to learn from other founders who have already overcome these challenges. For example, Li Xiang, the founder of Ideal Motors, actively sought advice from Zeng Ming, the chairman of Alibaba's academic committee, to discuss how Alibaba built its organization and conceived its strategy.

CZ is the latter, and he is constantly learning from various people. However, compared to Li Xiang, he is more like a lonely learner, relying on a lot of reading to enter the world of other founders. Shortly after Binance's layoffs, Walter Isaacson's "Musk Biography" was released. CZ read it for the first time and sent his reading notes to everyone, hoping that everyone would read it. He realized that Tesla was a good learning object, and many of Musk's values were similar to his own. Perhaps because of the recent layoffs, CZ specifically mentioned that Musk hires people very quickly, and Binance should learn from him.

But like Musk, CZ, He Yi, newly appointed CEO Richard Teng, and Binance's management team are also doing many things that have never been done before: how to make a company that is watched by countless national and regional regulatory agencies operate legally? How to maintain the position of the world's largest exchange in this unregulated market? How to manage a remote team of thousands of people? There are too many answers that cannot be learned and can only be explored by Binance itself.

On November 22, 2022, CZ resigned from his position as Binance CEO. Those familiar with the history of technology companies over the past five years may not be surprised by this, as Chinese founders often step down from their leadership positions: Pinduoduo launched its rapidly growing Temu after founder Huang Zheng retired; ByteDance similarly conquered the market with Tiktok after founder Zhang Yiming gradually stepped back; and there is the earlier example of Jack Ma, who put on a grand performance upon his retirement. The departure of a founder from a certain role does not mean that they have no further connection to the company, but regardless, this marks a new stage and a new challenge for the company. Binance already had more questions to answer than other companies, and now they have one more.

Regardless of whether these answers are ultimately correct, they will inevitably enter the textbooks of future generations.

This article is authorized to be first published on BlockBeats.

Author: Hanyang, host of LateTalk podcast, X@HanyangWang. You can find more of my writings at https://hanyang.wtf/f or https://crypto4.wtf/ (and I don't just write about blockchain). @mavislightyear also contributed to this article.