Manufacturing Binance: Ultimate Efficiency and Simple Tools

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

Editor's Note: This is the second article in the "Binance Series" by author Hanyang. In the first article, “Who is Building Binance: A Borderless Company in 4,000 Resumes”, Hanyang meticulously sorted through over 4,000 resumes found online, from individuals who have worked or interned full-time at Binance. Utilizing their backgrounds and experiences, Hanyang pieced together the outline of this mysterious "borderless" company, garnering likes and retweets from Binance's former CEO CZ and co-founder He Yi, creating a significant impact in the crypto community and providing readers with a deeper understanding of Binance's organizational structure. In this second article, author Hanyang continues to delve into Binance, exploring how internal employees collaborate efficiently, their treatment, and how they achieved a trading volume of $30 trillion in just two years. What do veteran Binance employees and those from large companies think of Binance? This article answers all of these questions. This article is authorized for exclusive publication by Rhythm BlockBeats.

In less than two hundred days, Binance became the world's largest blockchain exchange. Some founders view their company as a product that needs refinement, yet Binance took off on a growth rocket before it was even polished. In a short time, the remote working team grew from dozens to thousands, and the rocket not only needs to fly higher but also to avoid disintegration due to this complex collaboration model.

Before Binance, GitLab, with over two thousand employees, was a model for remote work. This company wrote one of the most detailed remote work guides, “GitLab's Guide to All-Remote”: covering everything from nonlinear work to evaluating remote work outcomes.

Today, emerging companies have more options than GitLab. The trend of remote work brought on by the pandemic has driven a surge in collaboration software: Zoom has over 800 million visitors per month, the daily active users of Microsoft Teams nearly doubled in a year, increasing from 145 million in 2021 to 270 million in 2022, and collaboration tool Linear completed a $35 million Series B funding round 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 ultra-fast growth can be unrelated to collaboration tools. For a long time, all management at Binance was based on group chats. If there was something to discuss, it was said in the group; if there was nothing, people went to work. If something urgent came up, a smaller group would be created for a separate discussion. All materials were directly placed in online documents. In the face of ultra-fast growth, all professionalism faded away. In 2020, Binance supported a total trading volume of over $30 trillion through group chats and online documents.

From $0 to $30 trillion, all you might need is a Telegram group chat and Google Docs.

Remote Collaboration

The previous article mainly discussed Binance's staff dispersed around the globe. This raises the curious question: how do these people collaborate? Does Binance have some unique working methods that allow it to rise so quickly?

The simple answer is: Binance does have unique working methods. Binance's unique working style seems to disregard collaboration and management during its highest growth periods. Since the hastily assembled rocket is still flying toward the moon, there’s no need to worry about whether the assembly method is rudimentary before it slows down.

In the early days, Binance had a company-wide Telegram group chat. The chat was very flat; for example, if He Yi needed to design a poster, she would directly @ the relevant person in the group. Once the person completed it, they would also post the results in the group. Almost all information from everyone was in this group. In other words, Binance's collaboration revolved around this large group. If there were documents, they would generally be placed on Google Docs. Just as Bezos required employees at Amazon to write documents instead of slides, CZ also hoped that the entire company would use Google Docs for collaboration starting in 2019. Only major presentations could still use slides.

I jokingly asked if they were not afraid of information leaks to the U.S. government, which might want to sue Binance. One interviewee replied, "Binance runs entirely on AWS; it’s not that complicated to manage."

In addition to the large group, Binance also had many smaller groups, such as a separate Chinese-speaking group. The main language in the large group was English, but many Binance employees spoke Chinese, so there were also many private communications based on WeChat. While using WeChat might be a more convenient choice, it is not without risks—WeChat may enforce stricter reviews on blockchain topics in group chats (private chats are unrestricted).

For urgent tasks, a smaller group would be created. If there was a product-related issue, developers would join, and sometimes the legal team would also enter the small group. Once everyone was gathered, they would synchronize tasks and determine if a meeting was needed. Binance employees referred to this as the "TG group collaboration model," believing it to be very efficient. One employee described the group chat style at that time: "If you don’t like something, just confront it directly in the group; who is right or wrong is discussed in the group. Everyone believes this is a good way to maintain efficiency. The unspoken rule is not to private chat; everything should be said in the group to maintain transparency."

A former employee who joined Binance in 2019 felt "shocked" at first: the entire company was incredibly transparent, seemingly trusting everyone, including new employees. In the first meeting, he learned about the product progress and next steps of each department. There were no situations where documents were inaccessible. This made him feel that "nothing was difficult to push forward"; when CZ or He Yi issued directives, the necessary resources were immediately allocated, and work would start the same day. Most excellent startups can achieve transparency and strong execution in their early stages. However, Binance's situation was a bit more complex: on one hand, it was still just a two-year-old startup; on the other hand, by 2019, Binance had already become the world's largest blockchain exchange, with employees from over 40 countries and regions, serving over 15 million users. From the perspective of being a two-year-old company, Binance's transparency is not surprising; however, from the perspective of scale, this level of transparency and execution is indeed not easy. One part of the body has already become a giant, while the other part is still developing.

Although this group chat-based collaboration model seems rudimentary, it does not mean it is easy to slack off. Most employees maintain an effective working time of 12-14 hours a day, even "running a few steps to the bathroom." Work continues until eleven at night; if someone is not found at "only this time," it would be considered inappropriate.

As a rapidly growing company, the workload keeps people glued to their chairs. The wake-up time for a Binance employee generally depends on when the first meeting is scheduled. However, this is also closely related to the time zones of their collaborators.

Some people’s first daily meeting was at 10:30 AM in the UTC+8 time zone, which later changed to 9:30 AM due to time zone differences—eventually becoming 2 PM because their superior went to Dubai. Others had to start their first meeting at 6 AM for cross-national collaboration. Daily meetings are generally not long, lasting about half an hour. The day only ends after the daily report is sent out at eleven at night. For a company like Binance, which operates globally, the most time-friendly time zones are generally Europe and Dubai. They are in the middle of different time zones, accommodating both UTC+8 and the Pacific Time Zone—this is also where many Binance employees are located.

Since remote work does not involve commuting and meals are also takeout, most of the time from morning to night is solid work. In comparison, a 996 work schedule does not seem exaggerated. But even though the group chat-based collaboration model is efficient, it cannot escape meetings: any company with thousands of employees dispersed in various locations needs to hold numerous meetings to communicate with each other. Some recall that their peak was holding ten meetings in one day, "really not getting anything done, just in meetings." A few groups control the frequency of meetings, striving to keep the number of meetings for grassroots employees to five or fewer per week. However, this is not the norm.

Perhaps due to excessive meetings affecting work, but remote collaboration necessitates meetings, so CZ and He Yi have very high demands for meeting efficiency. In 2018, CZ directly taught employees how to make more efficient reports: speeding up the process by listing key points. Meetings with him, unless under special circumstances, cannot exceed thirty minutes. Every quarter, CZ conducts a QBW (Quarterly Business Review) with the heads of business departments: results, progress, challenges, and issues. Essentially, this quickly informs him of what needs higher-level assistance. Some say, "If the first sentence doesn’t get to the point, CZ will definitely interrupt you."

He Yi's marketing department began emphasizing efficiency early on. As the most globalized department at Binance, it has the highest demand for information synchronization. Every Wednesday at 10 PM, the marketing department holds a weekly meeting: over a hundred core personnel attend, and each project leader must speak. Speakers are allowed only one slide and one minute to speak. The content of this slide is very simple: what were the most important achievements and progress in the past week, and what needs to be done in the next week? Especially, is there any work that requires cooperation from others? For example, if there is an event that needs translation support from various regions, it must be communicated in advance. The meetings are brief and efficient, typically wrapping up in about forty minutes.

Cross-cultural communication issues are also encountered at Binance. The Asian team tends to care less about the differences in working hours and rest times compared to the European team, especially since remote work has blurred these lines. They have to adapt to each other. Most Binance employees agree that it is a company that does relatively little training, but it provides each employee with $100 a month to learn English using a software called italk. CZ's love for reading has also extended to the company. On the second anniversary, Binance gifted each employee a customized Kindle e-reader with the Binance shell, and there is a subsidy for buying books. He even held book clubs for the leaders.

For individuals, the greater concern may be that completely remote work can lead to a loss of connection between people. Many people thought this wouldn’t be a big deal before working full-time remotely. However, spending every day alone, with few real people to meet offline, can eventually lead to a longing for more face-to-face communication.

The Way of Work

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

When Binance was first established, there was a window period where aspiring individuals could directly contact the founders for interview opportunities. The standard interview process at that time consisted of four rounds, with CZ or He Yi, a direct superior, a peer, and HR each conducting one round. At Binance, HR does not have veto power—this might make many large company programmers happy. However, that said, when you manage to find big bosses like CZ or He Yi online, and the first round of interviews is with them, the other rounds are merely a formality.

An 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 unrelated to work, focusing mainly on life, ideals, perspectives, or visions—somewhat "abstract" topics. CZ even carefully shared his passion and views on blockchain with candidates after interviewing them. Perhaps CZ and He Yi would agree with Sam Altman's view: values first, aptitude second, specific skills third.

Initially, employees used their own computers, but for security reasons, new employees were assigned a 13-inch MacBook Pro. Compared to other companies at the same time, Binance offered slightly higher salary packages. Many admitted that if they had not joined Binance, they would not have been able to join large companies based on their education and experience; normally, their salaries would not be very high. If they were willing to go to Dubai, their salaries could be even higher, along with monthly allowances. However, the treatment varies significantly between departments, with contract roles being the best compensated, followed by technical roles, and the marketing department being the lowest.

Binance conducts reviews every six months, where good performance can earn 4-6 months of bonuses, while poor performance might only yield two months. Therefore, many people can basically receive 20 months' salary each year. This is a very generous offer for most job seekers. In comparison, Temu, which is still rapidly growing, can only offer candidates 14-16 months' salary. However, later the review frequency changed to once a year, and bonuses were reduced.

Good performance is defined by scores. At Binance, employee performance is rated on a scale from 1 to 6. A score of 1-1.5 is the best, representing a superstar, with each team having at most one or none. Normal scores are 2-3 or 3-4. Scores below 5 face a PIP (Performance Improvement Plan), with a one-month evaluation period. If performance does not improve, the employee may be optimized (a euphemism for being fired). However, this situation has been rare for a considerable time.

Each employee's manager is responsible for scoring, but they must persuade their superiors (initially directly persuading CZ or He Yi). He Yi would check everyone's bonuses in the early days. However, one humane aspect of Binance in its early days was that bonuses would consider each person's base salary. If the base salary was low, the bonus would be higher.

Ordinary employees have a probation period of 3-6 months, while executives may need 6-12 months or even longer. Positions that require team leadership must undergo training to work in customer service for a period, typically two hours a day. This is a style more common in Chinese internet companies; for example, JD.com used to require every executive to work half a day as a delivery person each year.

Once officially joining Binance, the only requirement is to help this rapidly expanding company grow even more crazily. Unlike many startups that burn cash for market share, Binance is still a money-making machine while expanding rapidly. Therefore, it does not strictly control ROI like unprofitable companies. For example, in the marketing department, only new customer acquisition efforts consider ROI; brand, media, or community efforts are not controlled. Additionally, they do not use KPIs for management but rather set plans using OKRs, similar to large Silicon Valley companies.

Beyond the Rules

For Binance, as long as it does not hinder growth, everything can be postponed—including management.

Management is the most important issue for many founders. How should people collaborate? Thus, various collaboration software emerged: Linear, Notion, Lark, Slack… From Silicon Valley to Beijing to Bangalore, entrepreneurs in 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 demonstrates a different path: when a company is experiencing epic growth, is it really necessary to care about management? As long as it does not hinder growth, what’s wrong with being a company based on Telegram group chats?

Binance is not the only company proving that growth is unrelated to management tools. China's e-commerce company Pinduoduo is also known for its rapid growth. According to LatePost's report, Pinduoduo once had a QQ group of thousands for communication, relying on "word of mouth" for key tasks. Even after its IPO in 2018, when its market value reached $30-40 billion, Pinduoduo's administration was still exporting attendance records from punch-in machines and manually importing them into Excel spreadsheets. A person who joined Pinduoduo after 2019 believes that "the use of primitive management methods stemmed from the fact that for Pinduoduo at that time, survival was the most important." The same applies to Binance; not only does it need to survive, but it also needs to surpass all competitors and break through all regulatory obstacles. If survival is already challenging, the tools used for management are not important.

However, this does not mean that conventional management models are meaningless. Even Binance has felt the drawbacks of rough growth as its employee count increased.

In the second half of 2020, when the company approached a thousand employees, Binance initiated its first migration. Telegram was gradually abandoned, and all employees moved to Cisco's WebEx. However, this was just a transition; the ultimate destination was Binance's internally developed software, Wea.

If you have used ByteDance's software Lark (Feishu), you will find that the two have similar UI interfaces, and even the logos are somewhat alike. However, unlike the Telegram era where everyone used the same software, Wea is only available to the Binance main site team. Teams acquired by Binance, such as the CoinMarketCap team, cannot use Wea.

This also marked the beginning of Binance becoming less flat and transparent. For Binance, ensuring that employees do not leak information is more important than transparency. The cost of the flat and transparent era of Telegram was that there were numerous information leakage issues, and the uniform distribution of computers with security software was directly related to these problems. Starting with WebEx, Binance canceled all large group chats. CZ also does not allow large colleague groups to be created. However, there are still some interest groups. These groups can only maintain a size of a few dozen people and cannot be larger. Meanwhile, some slightly larger WeChat groups among Binance employees have also been disbanded. From this point on, Binance employees could no longer contact each other freely. Sometimes, two Binance employees might only meet through a third party's introduction. For instance, two people who collaborate daily might only recognize each other during a blockchain conference after being introduced.

Coincidentally, Pinduoduo, which once had a QQ group of thousands, later also became a company with very strict information control: "Employees cannot see the organizational structure or employees outside their department on the internal office system, nor are they allowed to create WeChat groups."

It was also during this period that Binance began to stop its rapid growth. Regulatory and compliance issues began to surface. Binance started to resemble other giants more closely. The days when one could directly contact the founders for job opportunities were gone; Binance began to care more about education and experience, making it difficult for those without a background in large companies to join.

Some employees claim that from then on, there were two types of people within Binance: old Binance employees and large company employees.

Old Binance employees are mostly those who joined in the early days. Many have grassroots backgrounds but entered the crypto space and Binance very early. Many of them hold a significant amount of BNB. Large company employees are the type of polished workers we see in Silicon Valley and Zhongguancun, generally not trading cryptocurrencies and selling any tokens they receive immediately.

Although large company employees may not seem as crypto-native, they might now be more suitable for Binance—after all, no matter how special Binance is, it will inevitably encounter many of the same issues faced by large companies. Finding people who have experienced these types of problems is clearly a better choice. These large company employees have worked for giants and even governments, have seen significant challenges, and possess strong capabilities. Many blockchain exchanges rise quickly but also collapse quickly. While Binance faces challenges, it remains standing, and these later arrivals have played a significant role. There is a Chinese proverb: one can seize a territory quickly, but governing it takes time. Since the second half of 2020, Binance has also shifted from rapid growth to a normal growth state.

The challenges Binance faces are not unique; those once rapidly growing internet companies have encountered this issue. In the early days, ByteDance employed a large number of young frontline employees who lacked large company backgrounds but had enough motivation to achieve results. However, after 2020, ByteDance also began to seek more experienced managers in the market, such as former Didi Chuxing Executive President Chen Xi or former Xiaomi partner Zhou Shouzi.

While bringing in employees from large companies is inevitable, it has also led to complaints from old Binance employees: some say that before 2020, there was never a need for upward management at Binance. However, starting in 2022, everyone needed to engage in upward management. In the early days of Binance, under the leadership of CZ and He Yi, everyone cared about only one thing: user focus, creating value, and thinking from the user's perspective. But now, they also need to consider whether their actions will help their leaders. What credits can they gain from their leaders to facilitate better promotions?

This is likely not what CZ hoped to see. He emphasized avoiding office politics and struggles and encouraged cross-level communication during meetings before the pandemic. However, once a company becomes large, no one can completely avoid the issues that arise in big companies. The "big company disease" has no escape velocity; it is the fate that all giants cannot avoid.

A Crossroads of Change

But Binance's changes will not stop here. In mid-2023, Binance underwent a large-scale layoff. The cyclical nature common in tech companies seems to be reflected in Binance: rapid expansion—massive hiring—contraction and layoffs. Whether a company is a flash in the pan or has a long road ahead generally depends on the reflection and rebuilding that occurs after the first major contraction.

The speed of a company's growth often outpaces the learning speed of its founders. How big can a company grow, and how far can it go? The speed at which founders catch up and adjust is a crucial factor. Some companies are fortunate; their founders have already accumulated a wealth of experience before the company was established. The founder of CATL, Zeng Yuqun, gained extensive experience in his previous company, so he never mentioned learning from other companies' management at CATL. More founders choose to learn quickly from those who have already navigated these pitfalls. For example, Li Xiang, the founder of Li Auto, actively sought advice from Zeng Ming, the chairman of Alibaba Group's Academic Committee, discussing how Alibaba builds its organization and strategizes.

CZ is one of the latter; he is constantly learning from various people. However, compared to Li Xiang, he is more like a solitary learner, entering the worlds of other founders through extensive reading. Shortly after Binance's layoffs, Walter Isaacson's biography of Musk was released. CZ read it immediately and shared his notes with everyone, encouraging everyone to read it. He realized that Tesla is a great learning object and that many of Musk's values are similar to his own. Perhaps due to the recent layoffs, CZ specifically mentioned that Musk is very quick to hire, and Binance should learn from that.

But like Musk, CZ, He Yi, newly appointed CEO Richard Teng, and Binance's management team are also doing many things that no one has ever done before: how to operate a company under the scrutiny of countless regulatory agencies? How to maintain the position of the world's largest exchange in this rule-deficient market? How to manage a remote team of thousands? There are too many answers that cannot be learned and must be explored by Binance itself.

On November 22, 2023, CZ resigned as CEO of Binance. Those familiar with the history of tech companies over the past five years may not be surprised by this; Chinese founders often step down from top positions: Pinduoduo launched the rapidly growing Temu only after founder Huang Zheng retired; ByteDance also expanded through TikTok after founder Zhang Yiming gradually faded from the spotlight; earlier examples include Jack Ma, who held a grand farewell event for his retirement. A founder's departure from a certain role does not mean they are completely disconnected from the company, but regardless, it marks a new phase and a new challenge for the company. Binance now has more questions to answer than other companies, and it has just added one more.

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