How do I add a second (and third) level to the folders?

From within your space, you can have up to three levels of sub folders for conversations, tasks, and files.  To add a sub folder, go to the conversation, task, or files tab and hover over a folder on the left side of the page. Click the drop-down arrow that appears.  Then click “Add folder.”   When viewing all conversations, tasks or files with manual sort selected, you can also see a full list of the available folders at the top of the page. By hovering over the folders at the top here, you can also add a new sub folder by clicking on the folder icon with the plus sign to the far right of the folder name.