Founder Mode or Jerk Mode?

One of my favorite shows right now is The Bear about a restaurant in Chicago. Besides the excellent acting, cinematography, and script, I really enjoy the realistic view into the fast-paced and chaotic world of restaurants. Oh, and the soundtrack is killer!

As dysfunctional as the kitchen is, there is one episode when it felt like the restaurant was teetering on disaster. They implemented a to-go ordering system, and when hundreds of orders immediately started streaming in, the staff realized too late that pre-ordering was not turned off. The chef starts screaming at the staff to work faster, one chef accidently stabs another with a knife, and two chefs rage quit.

If you wanted a picture of a toxic workplace, The Bear would be a textbook example. The head chef, Carmen, shifts from aloof delegator to overbearing micromanager. He rarely explains the reasons behind his decisions, does not consistently take feedback, and undermines the authority of his staff on whim.

If you have had any amount of work experience, you have likely experienced this. Not to the level of The Bear mind you, but you had a bad manager or worked in a company with a difficult culture. Every day feels emotionally and mentally draining navigating job related work and work drama.

This was partly my motivation for launching my own startup. I wanted to distance myself from the toxic politics of big tech companies to build the type of company I could admire. However, just like a new parent vows to not repeat the mistakes of their parents, flawss and biases that we did not even realize we had rear up to cause new problems.

This is where startup culture comes from in the early days. It’s the beliefs, values, and quirks of the founders. Over time, an emerging company-wide culture smooths over the rough edges of founder culture. Newly hired managers and executives help to scale the company and bring their own beliefs and values that subtly shift the culture.

This is a natural consequence of startup growth as founders step away from day-to-day operations. In order to scale, founders cannot be involved in every decision, follow every initiative, and know all the customers. As the founder delegates ownership, oversight, and responsibility, the life of the founder is more pep rallies, management reports, and the occasional hunt for capital.

In a recent talk Brian Chesky of Airbnb gave at Y Combinator, he challenged the notion that startups must progress this way. Instead, the best founders remain involved in the details. Soon after Paul Graham put these ideas into an essay called "Founder Mode".

What is founder mode? As Paul does not provide many details, it is easier to understand when compared with “manager mode”. Manager mode is operating a startup through proxy where founders hire the best people, delegate responsibility, and let them lead.

By contrast, founder mode means more involvement across all levels of the organization. It warns against hiring “professional fakers” that gaslight founders.? Instead, founders should have more skip-level meetings, delegate less, and dive deeper into details. It rejects generic advice such as, “Hire good people and give them room to do their jobs”, puts more faith in a founder’s intuition, and recognizes that this way of leading will be context specific for each startup.

For many founders, they felt they gained the “permission” to return to early-stage mode. They could be their quirky and eccentric selves again, which led to many Founder Mode memes. But there are also growing concerns about the efficacy of this leadership style and its potential to overlook toxic behaviors on the part of founders that are poor leaders.

I know what toxic founder mode looks like firsthand because that was me. I needed to know all details even if I could contribute nothing. I fought decisions that I didn’t like and overruled decisions by my team on a whim. I would "idea bomb" my staff, creating distractions.

This is a valid fear of founder mode. It can appear to give consent to founders with little emotional intelligence to steamroll employees. Founder mode can also sabotage female founders that try to be more assertive and push for higher effort as being bossy and unlikeable, which has led to a few public controversies forcing female founders to step down for creating a “toxic” workplace.

How can you navigate as a leader in founder mode without becoming a toxic leader? There is value in fostering a high-performance culture by being intimately involved in the company, but you also want to avoid being labeled an oppressive jerk.

I believe the most useful mental model to implement specific practices that enable founder mode can be found in the leadership values from Amazon and Jeff Bezos. Let me share nine ideas below:

• Establish and integrate culture – Amazon is driven by its leadership principles across everything we do from hiring to performance reviews to engaging customers. In a similar way, establish your culture from the very beginning and integrate it into every aspect of the business, something I address more in a previous post on startup culture.
• Speak with more customers – In Amazon’s 2016 shareholder letter, Bezos introduces the idea of Day 1 companies that stay innovative versus Day 2 companies that slowly die. A big mistake founders make is they stop listening to customers. Talking to customer will undercover problems to solve and new market opportunities to explore. Always have several customers calls lined up every week.
• Beware of management by proxy – Another insight from the shareholder letter is that managers in bigger companies tend to focus more on protecting their team than the customer or outcomes for the company. Insist on ownership and accountability for results at every level of the organization and go several layers down the organization if necessary to get direct answers.
• Prevent death by process overkill – When ownership and accountability are low, managers default to building and depending on processes. Some process is good and necessary, but often processes can morph into becoming the thing to focus on instead of outcomes for customers. Review processes on a regular basis and ruthlessly remove processes if they no longer deliver useful results.
• Emphasize clarity and simplicity in communications – Lack of understanding and poor thinking can be masked when put into a presentation or discussed in a meeting. That is why Amazon avoids Powerpoint and does document readings at the start of meetings. Embrace a culture of writing everything down in narrative form which fosters transparency by giving everyone equal access to clear and unambiguous information prior to a further conversation.
• Embrace experimentation and failure – Layers of management will slowly kill the initiative to think big or try things because the motivation is to “avoid looking bad” rather than to invent. Bezos noted that success at Amazon is based on, “how many experiments we do per year, per month, per week, per day.” Give people the permission to fail and demonstrate the acceptance of failure through blameless retros, hackathons, and celebrating bold experiments even when they fail.
• Make more decisions faster – Bezos said, “Most decisions should probably be made with around 70% of the information you wish you had. If you wait for 90%, in most cases, you’re probably being slow.” This is what plagues large companies. Because of the fear of failure and layers of process, most decisions simply take longer. Push for teams to make decisions sooner and dive into any situation when analysis paralysis takes over.
• Hire doers, not talkers – A natural consequence of becoming a manager is that people lose some of the skills they acquired as an individual contributor. Then there are some managers that lose their grasp of the domain and stop learning new things in their field. They simply talk a good game. Hire managers and executives that can and will roll up their sleeves and do the work of the staff.
• Become a more empathic listener – Founder mode does not mean jerk mode. Building a culture of more accountability results in hard decisions and difficult conversations, but it can easily veer off into becoming a toxic environment. Be a better listener, let employees know they are heard when speaking, but also be clear on boundaries and performance expectations.

With these nine concepts, you are in a better position to embrace founder mode without the negatives that being a more engaged leader bring. Leadership is something you learn and refine over time. You will make mistakes! But if you embrace learning and humility, you can be the type of founder that is both massively effective and admired by employees.

Mark Birch

I read this tweet that captured what it’s like building a startup in an emerging market:

This is one extreme of course. There are plenty of other emerging markets from Southeast Asia to Latam where launching a startup is not so difficult. That being said, every country comes with their own set of unique challenges such as infrastructure, regulations, talent, or capital.

Being in the US, we can easily take for granted the advantages we have. The power does not go out. There are plenty of places to work. If something breaks, we can order it and get it in one day. We do not worry if the government will shut us down. The currency is strong and laws transparent. We live in the best country for capitalism.

What has been inspiring to see is that no matter what, builders will keep on building. Indie hackers and entrepreneurs from around the world push through no matter what the circumstances. For example, countries like Nigeria and Argentina have had a long history of political and economic instability. Both countries though rank high when it comes to entrepreneurship and have seen many startup success stories.

The future is bright for startup activity expanding in every region of the planet. As I hear more stories of startups overcoming incredible odds to prove what’s possible, I will share those stories with you in this newsletter.

So great to be back in NYC these past few weeks to reconnect with startup friends. What is fascinating about NYC though is that I often meet just as many folks from overseas as I do folks from the US. Earlier this week I connected with startup folks from Singapore, Dubai, and Melbourne. Thanks for taking time to meet up and chat!

I am close to finishing up the second edition of my book Community-in-a-Box. I have not set a publishing date yet, but will have an update on that soon. In the meantime, thank you everyone that contributed a blurb for the book! I received dozens of submissions and am currently reviewing for adding to the book.

Last thing, I have some big news coming over the next week and well as some new travel plans. Stay tuned!