Founder Mode vs. Manager Mode

Are you going to turn on Founder Mode before you go into the office on Monday?

If this didn’t make you laugh, please Stop. Read Paul Graham’s post (again?). And Think. I’ll wait.

While I can’t claim to have much weight to what I’m about to write, the small LinkedIn trend to comment on this and capitalize on some attention seems problematic to me.

Why?

Because the people Paul comment on are specifically founders with visions big enough to have gotten money from investors, and those financiers seeing enough realized returns that they want to take some chips off the table. Those founders are an incredibly small set of people, more so if you’re not in Silicon Valley. It’s unlikely that they have time to post stuff on LinkedIn.

While I normally find his writing sharp to the point of bordering on incisive, there are a few things that in my experience are easily misunderstood in this particular case. Chief among them is channelling Steve Jobs’ “We hire great people and let them do their thing.” and then going into the conversation around letting managers “run” the business. This has led to people discussing dichotomies of “Founders need to do everything and never hire anyone.” vs. “Take a Chairman of the Board role and retire from day-to-day operations.” which seem to be rather counterproductive positions to take on the roles of both founders and managers. I think this is mostly an issue with the institutional investor mindset that originally triggered the manager mode transition Brian Chesky mentioned. The issue is then amplified when most founders haven’t worked in leadership (or even bigger organisations) before.

Build vs. Manage

1. Founders build when there is no existing thing. Architects. Designers of the blueprint. Marshalling the contractors to put a building in. Managers protect what’s already built. Founders are willing to take the risks of breaking the process and best practice for the greater good in the moment. (The process or practice isn’t likely to survive long anyway.) Managers have to expect that breaking the process now will set a precedent that makes that process unmanageable in the future, and hence have to err on the side of only outsized victories getting through (and good managers hate that as much as everyone else). Different mindset.
2. Roles. Steve Jobs’ quote didn’t say “do everything”. It says “do their thing”. Scoping roles is extremely important, and if that’s not done it’s probably better to go binary on founder-led or manager-led. But the “harmonious co-existence” option is to have founders build stuff, and managers taking over the stuff that works well once it has scaled to a size that managing it actively prevents the founder from doing other higher-priority things.
3. Responsibility. Managers don’t have the downsides or upsides of the founder. Believing otherwise - or trying to tell anyone who doesn’t own the business to work as if they did - is unhealthy. Entrepreneurs don’t want entrepreneurs working for them, they want people who know their stuff enough to get stuff done even when the textbook isn’t helpful. People who say that they want entrepreneurial employees generally have unsavoury work they prefer someone else take responsibility for without asking for more pay, or want salespeople but aren’t quite willing to pay sales commissions.

What I advised founders I spoke to this week when they brought “founder mode” up: The best approach is for you to understand perfectly the functions of the business. You don’t need to do everything yourself, but you need to be able to fix and scale any particular thing. The easiest way to get that understanding is to build the functions. As you build them you figure out what works and what doesn’t. Eventually you hire staff to do what works. Once this grows to the point that you have other things in the business that risk getting impacted by small-to-medium failures in this function, you hire a manager to oversee it. Keep the reporting line tight and retain decision power.

Have a think over the weekend and see how best to apply it for your business.

P.S.: I think the use of “mode” has really taken the conversation in an unhelpful direction, indicating that it’s something an individual person switches on and off, leaning closer to common use in current internet discourse. But “Founder-led structure vs. manager-led structure” is a mouthful.