Live data from Hacker News

Founder Mode

paulgraham.com

331–340 of 772 posts

Re: Founder Mode

#331

When a company is successful, by which I mean it turns a healthy profit and eventually even enough to go public, it ends up sustaining a lot more employees doing a lot less than a smaller, leaner company that can’t afford inefficiency. That doesn’t matter much to the successful company, it makes more than enough money to cover the inefficiency, and the inefficiency isn’t causing any real trouble - it just means that…

I’ve had a lot of conversations over my career about this general topic, and I still haven’t been able to answer: If a large, successful company operated extremely cleanly, wouldn’t that increase stock price even further? What are the disincentives to doing so (beyond the need for requiring more from people)?

> What are the disincentives to doing so (beyond the need for requiring more from people)?

Working out how to motivate people whose individual impact now has near zero impact on the stock price.

Re: Founder Mode

#332

Counter-example: Reed Hastings, co-founder and the CEO of Netflix for 22 years, famously did the opposite of what pg is saying. Reed insisted on a particular style of employee freedom & responsibility that IMO set the benchmark for innovating year after year and avoiding micro-managers, even as it scaled up past 2000 engineers. This story still has not been fully told. Reed was closely involved but perhaps the opposi…

It's a bit off topic, but I've never understood while people hold Netflix as some engineering Holy Grail.

Their product is straightforward feature-wise, and pushing a low-teen megabits per second of static video data on the internet in a somewhat timely manner is not a huge technical challenge nowadays (or 10 years ago).

Doing stuff like real-time video streaming, where you have to encode and push video to users with very low latency requirements (like Google Stadia) or with moderately relaxed latency but broadcast to a lot of users, like Twitch, or having a mind-bogglingly huge library like Youtube, is probably orders of magnitude harder.

I do like their shows, and probably a lot of technical wizardry VFX goes into making them, but getting the bytes to the end user is not it.

I'm sure there's a lot of adversarial smarts there, where brilliant engineers come up with incredibly complex solutions to simple problems, and it requires even more brilliance to make things run smoothly, but I'm sure their problems could be solved with simple pragmatic engineering.

Re: Founder Mode

#333

This whole article is written around one key sentence: > There are things founders can do that managers can't, and not doing them feels wrong to founders, because it is. But there are absolutely no examples given of what these things actually are. Paul kinda vibes around that vague statement for 5 more paragraphs, giving absolutely nothing concrete. And to be honest this hn comment section scares me, as it feels like…

[deleted]

Re: Founder Mode

#334
post #116

Earlier quoted context omitted.

How do you guys actually hire the superstars to join your startup as the early employees/partners? And not just the typical friend you know who's "a pretty smart guy" and his friend and so on

> actually hire the superstars to join your startup as the early employees/partners? You have to become a superstar first. I had the good luck of living down the street from the AirBedAndBreakfast founders in San Francisco in 2008 and we'd commute together to our Tuesday night YC dinners in Mountainview. I picked up early that Nate was already a superstar coder, Joe was a superstar designer, and Brian was a superstar…

[deleted]

Re: Founder Mode

#335

"We hired truly great people and gave them the room to do great work. A lot of companies [...] hire people to tell them what to do. We hire people to tell us what to do. We figure we're paying them all this money; their job is to figure out what to do and tell us." -- Steve Jobs

How do you guys actually hire the superstars to join your startup as the early employees/partners? And not just the typical friend you know who's "a pretty smart guy" and his friend and so on

It's easy. They all happen to live in SF and be working on a YC start-up...

/s

Re: Founder Mode

#336
George Hotz calls this "the button" on his last Lex podcast. https://youtube.com/watch?v=dNrTrx42DGQ&t=5247>

"This is Mark Zuckerberg reading that Paul Graham asking and being like, I’m going to show everyone how alive we are. I’m going to change the name [from Facebook to Meta]. Does Sundar Pichai have the authority to turn off google.com tomorrow? They have the technical power, but do they have the authority? Let’s say Sundar Pichai made this his sole mission. He came into Google tomorrow and said, 'I’m going to shut google.com down.' I don’t think you keep this position too long. Now, does Mark Zuckerberg have that button for facebook.com? I think he does. And this is exactly what I mean and why I bet on him so much more than I bet on Google."

Re: Founder Mode

#337

This whole article is written around one key sentence: > There are things founders can do that managers can't, and not doing them feels wrong to founders, because it is. But there are absolutely no examples given of what these things actually are. Paul kinda vibes around that vague statement for 5 more paragraphs, giving absolutely nothing concrete. And to be honest this hn comment section scares me, as it feels like…

As someone who runs a company, this article resonated with me. This stuff happens in every department and has a lot to do with how the company is run day to day. If you think about the major deliverables of a department - and pick any department - “manager culture” says the head of that department produces the deliverable internally, getting feedback from stakeholders outside their team perhaps, but “owning” the decision. Thus the product roadmap is “owned” by the product team, and the person the VP PM or CPO reports to is a passive recipient of it even if they have input or feedback on it. But that cascades downward: in manager culture, the mobile roadmap is owned by the mobile PM, the internal tools roadmap is owned by the internal tools PM, and so on. They all buy into manager culture, where autonomy is viewed as a defining aspect of their impact and importance, and to take away that autonomy is to undermine them and risk losing them (“micromanaging, which is bad”).

This same thing happens with marketing. Budgets get set. Agencies get hired. Branding and creative campaigns get developed and show up on the doorstep of the CEO hundreds of thousands of dollars deep. In engineering. In customer support. In finance (we have to do this, because the forecast cycle requires it; we can’t do that, because we don’t have the budget).

In founder culture, the founder gets down and dirty in the roadmapping process. They will give direct feedback on how a customer issue is routinely handled, or a design choice, or a creative campaign. Or a technical standard - Gates and Jobs both famously did this incisively and decisively. I’m no huge fan of Zuck, but it’s clear how much involvement he has with product and design for example. He famously bought Instagram because he wanted to, and understood its importance to facebook’s future, not because a strategy team identified it and a corp dev team engaged and investment banker to analyze and negotiate it. Mark Pincus was like this at Zynga too- ask anyone who was there.

Why is this important? Because people all the way down the organization don’t usually have the same nuanced understanding of the product, the market, the company strategy, the positioning, as you do. They will make decisions that optimize their subsystem but are sub optimal to the system. I had a customer support manager recently ask me if he could move a set of things that was causing a lot of load on his team to our law firm. The law firm of course charges 10-30xx per hour what a customer support agent makes. Even if you do a good job evangelizing the company mission and hiring non-mercenaries and whatnot, again and again and again you will see people wanting to “professionalize” their teams in ways that add more process, slow things down, and attenuate impact.

So If you let your company get into manager mode, you really lose control of the boat. And if you try to operate in founder mode after hiring a bunch of managers, they pissed because they don’t want to be micromanaged. But if they were crushing it, you wouldn’t need to.

I think the best founders are able to navigate this dynamic effectively, whether that’s by being able to effectively make a jump to a more delegated model, or building a team that can leverage their strengths without snuffing their hands-on involvement, or taking back the wheel at the right time.

A good counter example I can think of is Yahoo, when Jerry Yang took back over after Terry Semel retired. Manager culture had deeply set in there, and was not reversible despite Jerry’s good efforts and some great executives who were aligned to it. (And yes, the big, Steve Jobs inspired, “fix the company retreat” they did was literally “VP’s and up”.). As someone who worked there, was not a VP, but likely would have been in a “top contributing employees” cull by different measures, it was extremely painful to experience.

I would note that it takes a lot of energy to sustain this mode and be a leader through it, or to make changes in this direction to course correct.

Re: Founder Mode

#338
post #317

Counter-example: Reed Hastings, co-founder and the CEO of Netflix for 22 years, famously did the opposite of what pg is saying. Reed insisted on a particular style of employee freedom & responsibility that IMO set the benchmark for innovating year after year and avoiding micro-managers, even as it scaled up past 2000 engineers. This story still has not been fully told. Reed was closely involved but perhaps the opposi…

Hastings is rather unique in the current founder era in that he had previously founded a company, recognized he did not have the ability to manage it, attempted to step down, and then was told by his board to figure it out. He went on to essentially succeed in this and take his company public. Here is a person that recognized the problems of the stage pg was talking about, undertook a deliberate study of them, was su…

I agree and I’m following you right up to your last statement. I’m doubtful that Jobs and Hastings had similar functions or operated similarly. I worked with Reed but not with Steve. I know a few people who interacted with Steve, and their stories don’t sound anything at all like how Reed operates.

Re: Founder Mode

#339
post #213
post #158

Earlier quoted context omitted.

But even PG goes back on that by saying "Obviously founders can't keep running a 2000 person company the way they ran it when it had 20. There's going to have to be some amount of delegation." So what he is saying is managers should talk to their reports. He writes like this is some groundbreaking realization, but to me I'm not even sure what he's getting at. For example he pushes back against the idea of hiring and…

There is a balance between letting people run free, and controlling every tiny decisions. You have to keep the direction and vision, and you have to make sure everyone is going toward that. But you shouldn't trust they will do it by themselves (they may not have internalized it as much as you do either) and you shouldn't trust your ability to deal with every detail of the complex system you are trying to build. If yo…

[deleted]

Re: Founder Mode

#340

Counter-example: Reed Hastings, co-founder and the CEO of Netflix for 22 years, famously did the opposite of what pg is saying. Reed insisted on a particular style of employee freedom & responsibility that IMO set the benchmark for innovating year after year and avoiding micro-managers, even as it scaled up past 2000 engineers. This story still has not been fully told. Reed was closely involved but perhaps the opposi…

It's a bit off topic, but I've never understood while people hold Netflix as some engineering Holy Grail. Their product is straightforward feature-wise, and pushing a low-teen megabits per second of static video data on the internet in a somewhat timely manner is not a huge technical challenge nowadays (or 10 years ago). Doing stuff like real-time video streaming, where you have to encode and push video to users with…

It’s not straight forward at scale
Post reply on HN