Transitioning a Company To Be Completely Virtual

September 8, 2011

in Entrepreneurship

It seemed sort of far fetched nearly 5-10 years ago.   How could you possibly not have a physical presence for a company?  Let alone, how could anyone possibly take you seriously if you don’t have an actual office?  People would think you are a bunch of children playing around all day.  Well, that is sort of true for our type of work, but nonetheless Loadsys is a 100% legitimate company with 6 full-time employees on payroll and getting extremely important work done for clients across the globe that need our services.  Work that ensures that their companies provide online services, generate revenue and churn a profit.

Up until about one year ago we attempted to hire locally at our offices in Orland Park, IL and Mokena, IL.  It went somewhat well, but it was hard to find people already experienced in exactly the niche we are in.  So, we started to venture out across the US and attempt to hire out of state.  The last 3 hires have been in Texas, Indiana, and southern Illinois…with only a simple, few day, physical meetup before getting them started with work.  Since we have started to realize location doesn’t matter in the web development world, recently we have started to move things out of our office and onto the Internet.  I’m going to go over our challenges and solutions to evolving into a “virtual” company and how we try to overcome obstacles in the disconnection.

Mailing Address

This was one of my fears.  We wanted the company to still sound like a company.  The last thing we wanted is to use a home address and not have at least our address have that corporate feel.  Well, we searched and found exactly what we needed.  Office Links is a service that gives you a legitimate office address and also has packages so that you can rent out office space and conference rooms if you need it for short periods of time.  For instance, now we have a Sears Tower address and Office Links packages and mails our mail to my home address once per week.   Quite a handy service for a virtual company.

Project and Day-to-Day Collaboration

Technology plays a big role in allowing our team to fully collaborate virtually.  For instance, we heavily rely on Skype, in particular the new Skype for Business setup to be able to constantly group chat, do quick phone calls and even group video calls.  In addition, it is simple for us to do screen sharing with one another to go over a task or project in general.  We even leverage this to do phone calls with clients rather quickly and seamlessly.  In terms of account management, the Skype for Business lets me as a manager, maintain all of the Skype accounts.

In addition to internal communication, with our clients being anywhere, we have to be able to maintain and collaborate on projects virtually with them without wasting senseless time on phone calls.  We do this with a project management suite called Basecamp.  We have always used this product, even with an office, because we can collaborate on projects by organizing milestones, todos, messages, files and documentation…all with the client.

Lastly, sometimes we need to do group conferences with clients that require a more robust setup for screen sharing with a larger number of people.  Skype does an OK job with a small group, but when you have more it sometime lags.  For these types of conferences we use GoToMeeting.

Phone System

Every legitimate business has an automated phone system with employee, sales, tech support, and company directory extensions.  We are no different.  Originally our phone system was at the office on a physical computer sitting in the server room.  With advent of VoIP (essentially voice over the Internet), this is very doable to have a phone system hosted in the Internet, especially in the case where you are not using it heavily like ourselves.  You may know some very common at home VoIP services such as Vonage or Comcast.   So, we hopped on a VoIP provider named Teliax, created a virtual server at Linode and moved our phone system software to it.   Now our entire team just has a headset on their computer and use a software phone named X-Lite.

Development

In our case we all connect to the same server and do all of our development there.  We can easily look at each others development environments to go over issues or review a project.   This is another place where we used Linode and were able to take down our original development servers at the office.

Challenges

Although all of the above makes it much easier for us to be “virtual”, that is not to say that there are some disadvantages or even some dislikes I have for a virtual company.  I absolutely love the comradery that can be built with everyone physically together.  For instance we use to do lunch and have a couple of beers every Friday.  This is a time where we really got to know each other at a personal level. Even with that small personal touch, it creates a more emotionally involved experience as co-workers…as corny as that sounds.

Evaluating work and progress becomes harder as well.  In a physical location you can sort of just see that someone is working hard.  You can tell by physical queues and heck, their computer screen is right there.   In a virtual company you have to begin to evaluate more and more on performance alone with a trust that they are working their hardest to achieve the company and client goals.  This can also be a good thing though as well, because it makes you concentrate more on the actual progress of projects instead of if an employee is working a full 40 hours.

A feeling of disconnect as a whole can start to form as well.  Imagine being alone at home working all day, nobody to talk to directly or have a quick chat with in an office environment.  Sometimes Skype helps out with that for us, but sometimes it just isn’t enough and you can start to feel that disconnect.

Benefits

There are a couple benefits that completely make being virtual worth it.   Even with some of the challenges above a big benefit is the removal of office overhead.  In our case we were spending $900 per month on our office space, plus utilities and $500 per month on a T1 for Internet and our Phone system.  Overall we will realize a savings of nearly $1600 per month.  We can use this money towards bonuses, raises, company get togethers or anything else that the company or team needs.

The biggest benefit, which I haven’t been able to take advantage of because my wife works a full-time job, is you are essentially able to be anywhere and work.  If I really wanted to, I could go stay in Key West for a month or anywhere for that matter and work remotely.  With this type of work you are not strapped down to a desk at a specific location where you have to swipe in or out.   I’m hoping that at some point my family will be in a position to do longer term travels while they go have fun during the day while I work and then I can meet up with them in the afternoon.

Overall, the decision to become a virtual company is one of the best we have made, but is definitely not possible for every industry or type of work.  We are fortunate I guess.

  • Rick Cruz

    Because a virtual office requires no physical space, it is cheaper than a traditional office due to the lack of overhead. Communications bills may be equal or higher for the virtual company. However, gone are the costs of renting or buying a building, maintaining it and providing furniture and services for onsite employees and customers. A virtual office can also save on tax burdens by hiring independent contractors, who are responsible for their own tax payments.

  • I think making the company go virtual is a good thing for it makes the workload go faster and more efficient, in return it'll have more income generating the company and faster transaction to the clients. But having a company go virtual really depends on the company if it's applicable or not, just my two cents.

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