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Founder Mode

paulgraham.com

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Re: Founder Mode

#581

Post by Eisenstein »

vlovich123 wrote: post #573
jodacola wrote: post #126

Earlier quoted context omitted.

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)?

I think the main driver is a lot more simple than other people have said: when you don’t need that efficiency you can focus on resilience instead. As the pandemic showed with JIT supply chains, efficiency and resilience are often at odds. And the bigger you are the more resilience you want to protect your core business and let you just turn the fly wheel that’s making you profitable. That’s also why you see companies…

> This is 100% bad from a country/market level but is what you get when you let local optimizations trump capitalism. In some sense that local optimization also isn’t bad - it’s not uncommon that that behavior is also what lets efficiencies be extracted.

Is it really 100% bad? Do people really think that the goal of humanity is to work in the most efficient way to extract the most economic value from everything possible? Can't we just be content being 50% efficient and use the other 50% of that effort to chill with family and friends and talk about films or something?

Re: Founder Mode

#582

Post by manojbajaj95 »

trunnell wrote: post #246

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…

Yes. This is important, rather than treating it as a gospel, each company/founder has to find out a way that work for them. It doesn't have to Steve Jobs model nor the John Sculley model.

Re: Founder Mode

#583

Post by kamaal »

gregfjohnson wrote: post #446

I grew up seeing founder mode first-hand. My dad founded Celestron, and he operated just as Paul is describing. At my current company, I see the CEO doing the exact same thing, which gives me great hope. Huge contrast from my previous start-up, for which I have great anti-hope unfortunately. (Current company is Zap Surgical Systems, with Dr. John Adler as the founder.) I've seen John everywhere, all day every day. I'…

This is just a different way of saying your managers need to be more engaged with the work they are doing and not just worry about abstract metrics like measuring progress by number of tickets they close or something as such.

The thing is this is hard to pull off even for the actual founders. For starters its just hard, and tiring(and even pointless) to keep jumping over the ever increasing bar. Even more so when you are aging, know you are going to die and you are better off enjoying some of that money you earned, in the time and health that remains. At that point, you let things go on autopilot and begin to reduce engagement with your work.

The middle managers and employees you hire don't have incentive to even care this much. They are neither paid this high to care, nor have much to lose if they don't. Younger people show some passion because they wish to learn, but once they have enough of it, they go on the same mode.

To summarise. For people who made big money making a little extra doesn't matter all that much. People who don't get paid, don't even bother to try.

Re: Founder Mode

#584

Post by herpdyderp »

samvher wrote: post #99
intelVISA wrote: post #38

Earlier quoted context omitted.

> filters out the most capable and most effective people from executive positions Well, yes, because generally somebody who is actually 'the most capable and most effective' will simply be running their own business, why would they waste time climbing the ranks to work for somebody else's yacht? The filter exists because whilst PMCs can't build the ship, a founder can, they're fine at keeping it away from the rocks e…

> somebody who is actually 'the most capable and most effective' will simply be running their own business, why would they waste time climbing the ranks Maybe I'm being naive, but I think a large part of running a successful business is having a well defined niche / problem you solve. Getting to that point comes with a bunch of barriers and risks, and joining an organization that has that already figured out seems li…

Also, some of those most capable people don’t have the desire or means to risk entrepreneurship.

Re: Founder Mode

#585

Post by lopatin »

picafrost wrote: post #28

I struggle to see "founder mode" as something that scales. Is there not some self-selection bias occurring here, given the audience "included a lot of the most successful founders we've funded"? If a founder is exceptional and all of the other stars necessary for a startup to succeed have aligned, this may be a good approach. But then we are just back to the question YC has always tried to answer: what makes a founde…

For it to be a paradigm shift, there would have to be some definition of the new paradigm in the article, but it really only describes what it's not (regular management). Will go out on a limb and say that this seems to be a little bit of self-indulgence by successful people.

Re: Founder Mode

#586

Post by lend000 »

I think pg is trying to be diplomatic here by saying that "founder mode" is something to be discovered and taught in business schools in the future, and there may be a sliver of truth in that.

But I think the type of leadership this essay talks about comes from personality traits that are mostly determined by the end of one's adolescence: grit, obsessiveness/perfectionism, and vision.

Re: Founder Mode

#587

Post by w10-1 »

Let's just be careful: whether it's Steve Jobs or Paul Graham or Socrates, philosophy devolves to sophistry when the metric is whether you can convince people. The metric has to be whether you're right, in this case for the business.

The solution here, like most dialectics, is to do both: hire people who are not just smart, but who actually care for their part of the business in a way founders wish they could do if they had the time, intelligence, and grace.

As a non-founder, I'm so glad when the founders hire someone who cares enough to get their job done that I can rely on them and focus on my job -- and I aspire to be someone who others are glad to rely on. But from even two steps away, that is indistinguishable from the principles of division of labor and the practice of mutual political respect that strangle companies in bureaucracy. But the two situations are night and day, and obvious to those who live it.

So I think the difference is not whether the founder can reach down a level, but whether they -- or the COO or whoever plays this role -- can arrive on any scene and quickly tell if it's BS. Then when everyone knows BS is not safe and that commitment is respected, they'll find the courage to not play games.

So then a company runs well not because the founder is good, but because people understand and buy into what good means for the business.

Re: Founder Mode

#588

Post by kragen »

trunnell wrote: post #290
trunnell wrote: post #246

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…

Good points in pg's essay: * CEO/founder should engage directly at multiple levels rather than only interact with the company through their direct reports. (Same applies at every management level, btw) * Delegation is good, and it should happen in proportion with trust. * The dominant culture at many tech companies is flawed and sub-optimal. Bad points: * "Founders feel like they're being gaslit from both sides". The…

> If your department heads are not your most skilled operators, then... maybe that's a good problem to fix.

department heads spend all their time organizing groups of people. if organizing people better is your company's competitive advantage, then sure, putting your best people in those seats is probably best. but if your company's competitive advantage is that it makes better optical instruments, produces gasoline more cheaply, demolishes buildings more safely, or makes better-tasting food—you'd better let your best operators spend a lot of their time grinding mirrors, operating refineries, annotating floor plans, or cooking. if they spend all their time organizing people, your company will lose its competitive advantage

Re: Founder Mode

#589

Post by aiisjustanif »

baby wrote: post #549
rawgabbit wrote: post #497

Earlier quoted context omitted.

I don’t believe it is that mysterious or revolutionary. What PG is describing is the “optimization of local maximum” problem. Founders focus on the strategic goal. Managers focus on tactical goals. Rules and processes are put in place to efficiently achieve these tactical goals. The problem is, in certain situations, these local process are at odds with the broader goal. Only the Founder has the authority to break th…

Do managers focus on tactical goals? Or do the engineers do that? Managers are more like the glue of the system, they don’t really provide much value besides that.

Depends on what the responsibilities of your lowest managers are.

Re: Founder Mode

#590

Post by nstart »

smugglerFlynn wrote: post #294

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…

To be fair, I think this is acknowledged by Paul in this essay. He treats Founder mode as something that isn't well studied, isn't well defined, but has a vibe to it that people familiar with it would recognize immediately. The essay struck me as more of a call to action to study this style of company running and to acknowledge the "manager mode" as a possibly destructive model if relied on as the sole mode a company is run by.
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