Building a tech hub outside Silicon Valley

Growing Flexport’s Chicago tech office from 5 to 50

Today, Flexport moves over $10b worth of goods across the world annually with over 2,000 employees, 17 global offices and 5 global warehouses. So sometimes it’s hard to remember that we started with a single office located in San Francisco. Between 2014 and 2018, the company expanded sales and operations offices around the world, but the engineering team remained centralized in San Francisco.

In summer 2018, engineering leadership began an internal conversation about expanding our technology footprint beyond Silicon Valley to bring engineers closer to the customers, diversify our talent pool, and accelerate our hiring rate. In the three years since, we’ve opened five new engineering offices across North America, Asia and Europe, bringing people who build our technology closer to the customers they serve.

In this post we’ll look back on our experience starting the Flexport Chicago technology hub — our first technology hub outside the Bay Area. From why we chose Chicago to our experience opening the hub to scaling the team, we’ll discuss everything it took to build out a presence in The Windy City, where we’re hiring right now!

Why Chicago?

Finding and scoping out our new engineering office presence began with rigorous research into the ideal location for a new technology hub. Many teams including recruiting, finance, workplace, engineering, product, design and operations collaborated to gather insights for multiple locations, focusing heavily on a few key topics:

• Talent potential — could we hire fast enough?
• Cost of living — would we have to pay more or less for talent?
• Real estate — what are some other costs associated with a hub?
• Existing presence — would it be easier to start in a location where Flexport is already present (existing operations/sales office)?
• Domain relevance — does the location have anything to do with logistics?
• Landing team — is there a potential landing team to relocate to a specific location?

We narrowed our consideration set to a few cities including Atlanta, Los Angeles, Austin, and eventually decided to move forward with Chicago. Ultimately, Chicago emerged as a frontrunner thanks to it being a major city with a large and diverse technology talent pool. There was also fresh talent coming out of local academic institutions frequently, with nearby engineering schools including Northwestern, University of Chicago, UIUC, University of Michigan, and Washington University. Its cost of living is substantially lower than the Bay Area.

In terms of existing presence, Flexport had already opened a sales and operations office in 2018 to support our book of business in the Midwest. The growth of that revenue stream is a reflection of Chicago’s long-standing role as a key inland logistics hub. The city was founded due its unique geographical advantages for inland water transport, and has incrementally grown into one of North America’s largest hubs across road, rail, water, and air.

Lastly, and most importantly, we identified a landing team that was excited to relocate to Chicago specifically.

Opening the office, Our step-by-step guide

Step 0: Find a team and establish your mission

We started with a small team of five: two engineers, one engineering manager, and two product managers. We had been working together for about a year prior to the office opening.

The five of us were part of a larger SF-based Trucking team that was tasked with answering the question “how might Flexport efficiently move cargo on trucks when the trucking industry is so fragmented and has such low technology adoption?”. The team had developed domain expertise in the trucking space, and in particular in port trucking. Read more about our product strategy here.

Step 1: Land in the new site

Once the team landed in Chicago we remained focused on our existing product goals. Having part of the Trucking team remain in SF proved useful to maintain a connection with the rest of Flexport engineering. The team started learning the ins and outs of remote collaboration (this was a year prior to the pandemic). We even set up a constant video link between the two offices where engineers dropped by to collaborate and ask questions.

We wanted to build on and leverage the trucking roadmap — with many of our trucking partners now onboarded to our technology we identified an opportunity to go even further and bring technology to the drivers themselves. The truck drivers are the first to know when a container is picked up or delivered — we could make it easier for them to report this information while also sharing it with our customers. Read more here.

Step 2: Grow a single team

The guiding hypothesis was that the biggest constraint for growing the site (other than recruiting) is onboarding, thus it made sense to bring all new hires to a single team even at the expense of “over staffing” that team. Although “over staffing” could potentially lead to reduced productivity and morale, we believed we had some flexibility here since the majority of the team would not be ramped for a while.

In addition, we were able to ensure a consistent, high-quality interviewing and onboarding experience for those new hires. This helped increase our closing rate and retention. Interviewers could easily speak to the projects their team is working on, and provide hands-on onboarding guidance (e.g. pairing sessions).

Since the product strategy for tackling the trucking business problem above focuses on investing in technology for the vast trucking domain — there was no shortage of problems for the team to solve. Specifically, we understood early on that multiple solutions would have to be implemented simultaneously in order to achieve our automation goals. Read more here.

Step 3 : Split the team based on projects and product areas

As the team grew, its scope grew with it — as a strong product team, it was empowered to seek the right problems to solve for the company. The team, now with close to eight engineers, organically started working on two parallel key initiatives. At that point the team could easily be split into two sustainable teams which we could now divert new hires to based on product needs and onboarding capacity. This was also the first time we could support internal mobility (the ability for engineers, product managers, and designers to laterally move within the organization), which is a key component for talent retention.

The Trucking team expanded its scope and started building a product, to be used in a Warehouse, that helps manage the trucks arrival and departure. This was the opportunity we were waiting for — a product initiative of high value with a motivated team behind it made the best candidate to split the original trucking team into two: Trucking and Warehousing. Read a bit more about warehousing here.

Step 4 : Move more products to Chicago

With two highly productive teams, all with a significant base of ramped engineers and onboarding capacity, we could afford taking more risks and revisit our original goal for opening the engineering hub: “How might we leverage this hub to contribute to Flexport’s long term product goals?”. We identified an opportunity to grow the hub’s product scope by “moving” a project from SF to Chicago.

This is a hard decision to make with many risks involved (i.e. could a project actually be moved without the product team that is responsible for it? How long would it take for a new team to get onboarded to this new product area? Would the new team be able to develop ownership and feel empowered over that product area?). We decided to take the risk — we made the opportunity available to engineers from both existing teams to transfer to the newly formed team, and work collaboratively with the existing SF team for a quarter to transfer all technical knowledge.

The Air team was formed in Chicago by transferring the air product area and goals to this newly formed team. The team focuses mostly on planning and optimizing air freight shipments — it made sense for us to develop our Air product in Chicago since almost all air freight arrives to a Flexport warehouse prior to final delivery and then gets moved on a truck. Having both the Warehousing and Trucking teams in Chicago made cross team collaboration easier. Read more about air planning here.

Step 5 : New initiatives

Now, with three productive teams, we could support a net new initiative — building a net new team. The product leadership team identified a business opportunity in an adjacent area to our current technology footprint, we identified a tech lead to pair with a PM and take on that initiative. They worked closely with a PM to design and architect the foundations for that new product. We then started to grow the team in proportion to the growth of the roadmap.

The Consolidations team was formed. The team was tasked with designing and building a solution to model and optimize all types of consolidation efforts at Flexport. Similar to air freight — most consolidated shipments must move through a warehouse, so having the Warehousing team local to Chicago proved invaluable. Read about one of Flexport’s consolidation products here.

Step 6 : Encourage a culture of growth

Currently, in summer 2021 (3 years after starting the process), the Chicago technology hub has six fully staffed teams and two growing teams. At this point we start to see organic internal mobility — PMs, engineers, and designers that have been on their team for a while started seeking different opportunities internally. Flexport encourages internal mobility as a means to long term retention as well as cross pollination between teams on technologies, best practices, and domain expertise.

Key Learnings/Takeaways

Several decisions have contributed to the success of the Chicago technology hub.

First, we kept hiring standards high with the exact same interview process we use in SF. Flexport has held a high bar since the early days, and we wanted to keep that in place to ensure the success of the new technology hub.

Second, we explained our vision for the site with the prospective candidates throughout the recruiting and onboarding processes. We want to bring in people who are excited to build a distinct culture and contribute to the growth potential of the new office, while also being upfront about the challenges a new hire might face in a rapidly growing office.

We also made office cohesion a top priority. All teams and products in Chicago are tightly linked to one of Flexport’s key product pillars (transportation automation), rather than working across multiple different domains. Having multiple co-located teams within the transportation automation organization has ensured more local cross team collaboration than over-reliance on remote collaboration with San-Francisco-based teams.

Lastly, we ensured that our newly formed Chicago teams have local business stakeholder, product management and design support. Specifically we wanted to avoid a scenario where the office is made of a collection of engineers working on projects driven by remote leaders without full context,ownership and empowerment.

Looking ahead

Flexport Chicago is on track to double its headcount by the end of the year. The teams in Chicago are empowered to work on the core opportunities that are at the heart of Flexport’s product strategy. Our main areas of focus are coordination, planning, and execution of freight:

• Coordination — We are revamping Flexport architecture and adapting it to fit our business scale and complexity.
• Planning — Flexport manages supply chains at scale, and scale brings challenges and opportunities. For example: could we offer two customers to share their space and thus create a win-win-win situation between Flexport and the customers?
• Execution — Flexport and its partners execute our customers’ shipments (we move their cargo around the world), with an extremely diverse mix of customers and geographies, we have to build the platform to allow us to automate the movement of freight.

It’s an exciting time to join Flexport and the Chicago office in particular. The Chicago office is in the Fulton Market District, and we have open roles in engineering, product, and design. Help us revolutionize the freight industry!

Thank you to all of Flexport Chicago’s product managers, designers, data scientists, and engineers that helped support the growth of this technology hub, with special thanks to Shubham Bansal, Max Heinritz, Eytan Davidovits, Ethan Goldberg, and Allison DiDominick.