Don’t call Amir Nathoo a CEO. Since last year, his title has been “head of Outschool,” the online learning company he co-founded in 2015. The same goes for the rest of his executive team, where there isn’t a chief-anything in sight.
Outschool, like a growing list of companies that includes Stripe, Gusto, Polygon and MassMutual, shirks the traditional title hierarchy of managers, directors and vice presidents. Instead, the company is run by executive “heads” and middle- and upper-management “leads,” where leads can report to leads and both leads and heads can report to heads.
“We wanted to take a different approach that kind of reduces or de-emphasizes hierarchy and status,” Nathoo told Protocol.
Outschool largely modeled its system of titles after Stripe, but took it a step further, removing even C-suite titles (a move that Polygon also made last year). Similar to the payments giant, though, Outschool uses an internal org chart as a reference for employees’ actual job descriptions and the size of their teams.
Nathoo walked me through how this all works. This interview has been lightly edited for length and clarity.
Why did you decide to get rid of most titles?
Traditionally, titles at companies reflect your place in the hierarchy, your level of management. You have your managers, directors, senior directors, VPs, senior VPs, executive VPs, C-suite.
The reason this felt off for us was this idea that it’s almost like military ranks, where we’re making it very visible, the difference between people’s status.
Hierarchy in management is important so you know who to go to, who your manager is for guidance or direction, or for career discussions. But in most work in our company, it’s not the case that I wanted the person with the biggest title or highest in the hierarchy to necessarily be the decision-maker in the room.
Secondly, for us in particular, it matches our mission to inspire a love of learning as opposed to seeing education as something you do in order to acquire grades or certifications. Internally, we should be focused on the work itself, not on the status aspects of it.
What’s one way that this system has made for better outcomes at Outschool?
One specific area is we organize our exec team to not just be my direct reports, but to be all heads in the company. That leads to more voices around the table and a more diverse group in terms of the functions represented and the ideas represented. That’s made our annual planning process better, because there’s more visibility and more involvement from more leaders in the company.
Has this also simplified the way you handle compensation?
Compensation is tied to the level. You could be a head, and there are multiple levels within that title, and there are multiple different levels within “lead.”
We then do the compensation by levels so that even if your title is not changing regularly, because we have so few titles, your compensation can be increasing regularly as you get promoted and uplevel your capabilities. We have standard salary bands that we think are competitive in today’s market.
What’s the cost of a title? A title can be tied to compensation. What’s your philosophy on that?
Some people take a different view and say: Hey, titles are free. Why not just give people a big title to make them feel good, or even substitute for other things, like pay or equity?
On the surface, that seems reasonable: It doesn’t cost anything. But I think there is this hidden cost, where you are emphasizing that status, that seniority. I think that can lead to more political environments and less productive environments.
Did internal strife over titles lead to this change?
No, not at all. It was proactive. I wanted to put it in place before we got to the point where there would be continuous discussion over titles because I’ve seen what can happen at other growth companies through my network.
I arrived at this belief that a different approach was more in tune with where Outschool was growing. During the pandemic, we grew very fast, from 25 people to 180 people. All along that journey, it became clear that we were going to introduce an executive team and middle management. It was at that point proactively that I decided to make the change.
How will this model work as Outschool grows? Will it get confusing when you’re double or triple the size you are now?
One thing that gives me confidence about that is Stripe’s example. We’ve taken it a little bit further than Stripe because they have C-level heads and leads, but it’s still the same principle, and they have scaled to many thousands of people and have heads reporting to heads and leads reporting to leads.
Perhaps it’s confusing at times internally to know, is this head I’m talking to responsible for a 10-person organization or a 1,000-person organization within the company? The question then becomes: Does that actually matter to the work? And can that easily be solved just by having an org chart?
Do you worry that this system is a turn-off to executive candidates who might want a C-level title?
We have seen that some candidates are put off by this. It’s a minority, and we regard that as a good thing. I don’t want leaders in the company who don’t buy into that philosophy that status is not the important thing — impact is. I regard it as an effective filter given that we are an impact-oriented company.
I think there can be a concern that if you’re called the “head of,” when you’re looking for your next role, recruiters might look at that and think, “Oh, they haven’t held a C-level position.” We encourage our people to describe the work that they actually do, making it clear that it is C-level, and I commit, when doing references, to verifying that so that we don’t negatively impact people’s careers.