Paul Graham, co-founder of YCombinator, a startup accelerator and venture capital firm, created a bit of a buzz in Silicon Valley and the broader world of small businesses when he coined the term “founder mode” earlier this month. His article made reference to Airbnb’s Brian Chesky and his changed mindset regarding business management over recent years.
The idea emerged as a comparative approach, beginning with Checky’s initial so-called “managerial approach” that ultimately transformed into what Graham has dubbed “founder mode”.
Essentially, the difference is that a leader adopting the former plays more of a supervisory role while the latter is completely hands-on.
Graham’s conclusion, interestingly enough, is that Chesky and Airbnb owe their success to Chesky’s adoption of “founder mode”, having strayed away from striving toward delegation and rather placing increased emphasis on being intimately involved in all levels of business operations.
But, what exactly is founder mode, and does it make sense to assert that it’s effective across the board rather than just in a few isolated cases?
Key Features of Founder Mode
In the most basic sense, founder mode is all about business owners who adopt a method of being hyper-involved in all aspects of operations, but the best way to understand the term is by unpacking its key features.
Hands-On Involvement
Founders actively get involved in all aspects of day-to-day activities, things that most business owners would leave up to employees and managers to deal with.
Normally, this means that they end up wearing multiple hats and need to understand all aspects of the company and its departments, ranging from sales and marketing to product design and customer service. In fact, not only do they get involved in everything, but they also tend to take it upon themselves to make important decisions.
Focus on Problem Solving
Business owners adopting this approach tend to be on the lookout for problems to solve and identify issues. Essentially, they’re actively seeking issues which can be a preemptive way to deal with potentially big problems.
Intensity
There’s no doubt about the fact that founder mode, as explained by Paul Graham, requires a certain amount of intensity. That’s why it’s easy to see how individuals like Steve Jobs and Elon Musk fall into this category.
It’s all about working long hours, being deeply focused and putting a great deal of professional and personal energy into work, almost blurring the lines between business and pleasure. The founder tends to take on loads of responsibilities, essentially leading to a situation that many outsiders would describe as being spread too thin.
Vision-Driven
Founders tend to be focused on achieving their goals, and it’s all about realising a specific vision. From there, they tend to be completely focused on working towards that vision and making it a reality.
Efficiency in Dealing with Limited Resources
Founders who adopt “founder mode” tend to be incredibly efficient in many sense, with the ability to make smart decisions about things like dealing with limited resources and finding their way out of tricky situations. That’s part of what makes them useful in terms of getting involved in all aspects of the business, even if it doesn’t seem practical from the outside looking in.
Adaptability
One of the most important features of “founder mode” is the ability to adapt to situations and pivot on a dime. If the situation changes suddenly, they need to be able to switch things up and find a way to properly deal with things.
The Upsides and Downsides of Embracing Founder Mode
“Founder mode” as a business management concept is fairly extreme – it involves an intense style of management that requires the founder to be everywhere at the same time.
Of course, the two main concerns involved in adopting his approach are firstly, the founder needs to be the right kind of person. And second, if they don’t get it right, they’re likely to do more harm than good.
How Can Founder Mode Be Beneficial for Startups?
If the idea is properly implemented and the founder of the startup has the right personality and skillset, it seems like the “founder mode” approach could actually be incredibly successful in some cases.
Some of the benefits it offers, if it works, include:
- Fast decision-making because the founder is always around and in the know.
- The founder has a deep understanding of the business from all perspectives.
- Important changes can be made quickly and effectively.
- Requires that founders are deeply personally invested, so they’re likely to put all their passion and efforts into making the company a success.
- Founders have the opportunity to build strong relationships with employees and customers.
- It’s a great way for founders to learn plenty of new skills.
Challenges Associated with Founder Mode
Unsurprisingly, there can also be a lot of challenges that come with adopting “founder mode”, whether it ultimately ends up being effective or not.
- Founders are at a super high risk of burning out due to the amount of work they have and the sheer intensity of the job.
- There’s a massive risk of drifting over from high involvement to full-on micro management which is where things just become inefficient.
- Many founders suffer from decision fatigue after having to constantly make important decisions day in and day out.
At the end of the day, “founder mode” definitely isn’t best for everybody, whether it’s the business in question or the actual founder of the company.
The concept certainly has merit in specific contexts and has the potential to be incredibly effective – just look at Apple – but that’s not necessarily the case.
It all comes down to the founder having the right personality and skillset along with the business being set up in the appropriate way for this to be an effective approach.
