Really love this. I agree teams want clarity, they also want to move fast and win. I've worked at some businesses where the founder doesn't make the tough decisions and instead "pushes them down to the teams" to figure it out. The results are often that two teams (in my case Product and Marketing) had different priorities, and spent countless hours negotiating and horse trading trying to do both sets of priorities, and making very little progress on both.
In retrospect I think we would have gotten a lot further if the CEO had completely shut down my teams goals for a quarter and then circled back to them. We would have shipped more, we would have won, and then we all would have felt a lot happier and less thrash.
Within the evolution of one company, I've seen Founder Mode work well, then be totally wiped out and replaced by Manager Mode. Two observations:
1. The wrong senior leaders ruin Founder Mode. In my experience, experienced, senior leaders HATE Founder Mode. They're used to Manager Mode - they like having control and power over their turf. Founder Mode requires senior leaders to drop most of their ego and let the top dog make the decisions. Too many of the wrong people can revolt and make this entire mode fall apart.
2. The wrong Board can ruin Founder Mode. If the Founder doesn't control the board, say goodbye to Founder Mode. Because if the Board isn't aligned with the trajectory mapped out by the Founder, it's VERY EASY to throw the Founder under the bus as crazy, hard-to-work-with, etc. As the unconventional model it's very easy to find blame at the Founder vs. Manager Mode where there's many things you can blame.
The Founders who are able to maintain Founder Mode throughout multiple evolutions of a business are truly special people. Most people aren't that though.
I think there is a very important through line in your comments: designing an org for founder mode only works while it is run by an exceptional founder (who has freedom from their board to run it this way)
As I read this, I was thinking about how critical it is to vet incoming senior leaders and board members who are completely clear and in agreement that it is a Founder Mode organization. If that changes, then it is the senior leader or board member that should probably be replaced.
"Mode" suggests a state, not a trait – is an organization really "a Founder Mode organization," or an organization that is *currently operating in* Founder Mode?
Perhaps some companies plan to operate in Founder Mode indefinitely/for the foreseeable future, but as I read it even Dan's article seems to suggest many companies would "outgrow" the effectiveness of Founder Mode at some point (though maybe not for a while).
Either way, you're correct that setting expectations with incoming leaders would be important...but why would such a company be hiring "senior leader" roles, anyway? (more like "senior management" roles, I suppose, if only the founder is leading)
The tricky part of this is running an Org in Founder mode with little or at times no clarity coming from the founder. This leads to rifts between founders and employees who can get things done.
Some might say Founder Mode is just another way of describing a stubborn, hard-headed CEO. But, when there is so much emphasis placed on the importance of the CEO/Founder being the storyteller sells the vision and raises funding for their idea, who is the first salesperson not only selling to customers but to their hires and team, it totally follows that it is this person who guides that vision. They don't call them (us) leaders for nothing!
> A more nuanced version of the principle: founder mode organizations maximize the number of decisions made by the founder, up to the limits of their ability to make better or faster decisions.
The second part of this sentence is *so* important. The danger is when every startup founder listens to this advice and doesn't recognise the limits of their ability to make better/faster decisions.
It doesn't get mentioned much, but many folks who are working in startups atm whose founders have decided "founder mode" is the way forward, probably wish their founders had never read Paul Graham's essay 😅
Really love this. I agree teams want clarity, they also want to move fast and win. I've worked at some businesses where the founder doesn't make the tough decisions and instead "pushes them down to the teams" to figure it out. The results are often that two teams (in my case Product and Marketing) had different priorities, and spent countless hours negotiating and horse trading trying to do both sets of priorities, and making very little progress on both.
In retrospect I think we would have gotten a lot further if the CEO had completely shut down my teams goals for a quarter and then circled back to them. We would have shipped more, we would have won, and then we all would have felt a lot happier and less thrash.
Absolutely. People think all they want is autonomy, but they also need clarity.
Within the evolution of one company, I've seen Founder Mode work well, then be totally wiped out and replaced by Manager Mode. Two observations:
1. The wrong senior leaders ruin Founder Mode. In my experience, experienced, senior leaders HATE Founder Mode. They're used to Manager Mode - they like having control and power over their turf. Founder Mode requires senior leaders to drop most of their ego and let the top dog make the decisions. Too many of the wrong people can revolt and make this entire mode fall apart.
2. The wrong Board can ruin Founder Mode. If the Founder doesn't control the board, say goodbye to Founder Mode. Because if the Board isn't aligned with the trajectory mapped out by the Founder, it's VERY EASY to throw the Founder under the bus as crazy, hard-to-work-with, etc. As the unconventional model it's very easy to find blame at the Founder vs. Manager Mode where there's many things you can blame.
The Founders who are able to maintain Founder Mode throughout multiple evolutions of a business are truly special people. Most people aren't that though.
I think there is a very important through line in your comments: designing an org for founder mode only works while it is run by an exceptional founder (who has freedom from their board to run it this way)
As I read this, I was thinking about how critical it is to vet incoming senior leaders and board members who are completely clear and in agreement that it is a Founder Mode organization. If that changes, then it is the senior leader or board member that should probably be replaced.
Agree, there absolutely needs to be a social construct inside these companies, and it needs to be clear to people joining.
"Mode" suggests a state, not a trait – is an organization really "a Founder Mode organization," or an organization that is *currently operating in* Founder Mode?
Perhaps some companies plan to operate in Founder Mode indefinitely/for the foreseeable future, but as I read it even Dan's article seems to suggest many companies would "outgrow" the effectiveness of Founder Mode at some point (though maybe not for a while).
Either way, you're correct that setting expectations with incoming leaders would be important...but why would such a company be hiring "senior leader" roles, anyway? (more like "senior management" roles, I suppose, if only the founder is leading)
Brilliant article that needs to be studied by all.
Thank you!
Good insight 😌 Can i translate part of this article into Spanish with links to you and a description of your newsletter?
Of course!
Fascinating! Where are these details coming from? Curious who the sources are.
Mostly public interviews with the CEOs, plus some personal conversations I’ve had with members of the team
Really neat to have such a deep dive into their processes. I find it fascinating! Thank you!
So glad it was interesting!
The tricky part of this is running an Org in Founder mode with little or at times no clarity coming from the founder. This leads to rifts between founders and employees who can get things done.
There needs to be clear expectations set on when the founder will be involved in decision making and when they won’t.
I feel like Tesla works the same way as Steve Jobs Apple did
Interesting, I would love to know more about that example
Some might say Founder Mode is just another way of describing a stubborn, hard-headed CEO. But, when there is so much emphasis placed on the importance of the CEO/Founder being the storyteller sells the vision and raises funding for their idea, who is the first salesperson not only selling to customers but to their hires and team, it totally follows that it is this person who guides that vision. They don't call them (us) leaders for nothing!
This is really well articulated. Thank you.
Thank you!
> A more nuanced version of the principle: founder mode organizations maximize the number of decisions made by the founder, up to the limits of their ability to make better or faster decisions.
The second part of this sentence is *so* important. The danger is when every startup founder listens to this advice and doesn't recognise the limits of their ability to make better/faster decisions.
It doesn't get mentioned much, but many folks who are working in startups atm whose founders have decided "founder mode" is the way forward, probably wish their founders had never read Paul Graham's essay 😅
Agree!
There is only one priority, well, maybe two.
1. Ensuring customers are happy...which actually drives
2. Driving revenue to the bottom line.