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- Founder Mode Leadership
The concept of operating in "founder mode," popularized by Paul Graham in 2024, resonates deeply with startup founders. However, its principles extend far beyond the realm of entrepreneurship and offer valuable lessons for leaders and operators at all levels, especially in rapidly growing companies.
The core idea is that empowered teams are the engine of any successful startup. But empowerment requires a specific type of leadership – a leadership style often embodied by founders. This "founder-style" leadership isn't about titles; it's a mindset and a skillset that can be cultivated and learned.
While the term suggests exclusivity to founders, these leadership principles are not only relevant to startups but are especially crucial for scaleups and essential for sustained success in large enterprises.
The Pitfalls of Professional Management
The drawbacks of micromanagement are widely acknowledged. As a company scales, the conventional wisdom often dictates hiring "professional managers" who, in theory, empower their teams to excel. Brian Chesky of Airbnb initially followed this advice, with disastrous results. The optimistic summary of this approach is to "hire good people and give them room to do their jobs."
However, this approach can backfire spectacularly. As Steve Jobs famously observed about Apple's experience:
“We went through that stage in Apple where we went out and thought, Oh, we’re gonna be a big company, let’s hire professional management. We went out and hired a bunch of professional management. It didn’t work at all….They knew how to manage, but they didn’t know how to do anything.”
This highlights a crucial truth: it's easier to train an expert to manage well than to train a manager to be an expert. Leading companies across industries have internalized this lesson, recognizing that "experts leading experts" is a fundamental principle of effective leadership. Hence it is important to develop expertise in the core skills.
This is why empowered teams need better leadership, not less. But what does this look like in practice?
We need to distinguish between two scenarios:
Early-Stage Startups: Before achieving product/market fit.
Growth-Stage Companies: After product/market fit, focusing on scaling.
Founder-Style Leadership in Early-Stage Startups
Founders are the ultimate employees in the early days. They are completely immersed in the business, possessing an unparalleled understanding of its vision, customers, market, and technology.
Key Characteristics of Founders:
Visionary: They craft and relentlessly communicate the company's vision.
Customer-Obsessed: They likely have the most direct customer interaction.
Experiment-Driven: They've been involved in every test and iteration.
Data-Informed: They're deeply familiar with the data and analytics.
Learning-Focused: They've learned from every mistake, often their own.
This deep immersion cultivates what we call product/business sense – an intuitive understanding of what customers want, what the market needs, and how the business should operate. This "sense" is a startup's most valuable asset, making the founder's intuition and judgment incredibly valuable.
If a startup achieves product/market fit then most likely along with the founder, someone else in a leadership role also has cultivated it instead.
For a founder (or the leader with this crucial "sense") to prematurely delegate or empower others to "figure things out" would be detrimental to the company's success.
Founder-Style Leadership at Scale
As a company grows, even a highly effective founder can't maintain the same level of direct involvement. Hiring a COO-type operating partner can help (think Jobs and Cook, Zuckerberg and Sandberg, Gates and Ballmer), but it's not a long-term solution for providing the necessary business sense across all teams.
To truly scale, founders (and leaders) need to master the art of coaching. As Bill Campbell emphasized, "you cannot be a good manager without being a good coach."
The expertise remains essential, but the focus shifts to scaling that expertise through teaching and coaching. This is why leading companies often incorporate both product/business sense and coaching into their leadership principles.
Examples from Top Companies:
Amazon: Dive Deep, Hire and Develop the Best, Customer Obsession, Ownership, Bias for Action, Earn Trust, Deliver Results.
Apple: Deep Expertise, Immerse in the Details, Scaling through Teaching and Coaching, Innovation through Collaboration.
Google: Substance First, Develop Others through Coaching, Empower Your Team, Focus on Outcomes, Provide a Compelling Vision.
These companies explicitly emphasize the importance of product/business sense and make it a leader's responsibility to cultivate that sense in their teams.
Contrast this with a "professional manager" who lacks this deep understanding of the product and market. Their ability to lead effectively will be severely hampered.
Furthermore, coaching without a foundation of expertise is ineffective. A leader must possess the necessary knowledge to guide and develop their team members.
Developing Business Sense and Coaching Skills
What if you're new to a company or lack the deep expertise of your team members? The good news is that both business sense and coaching skills can be learned.
Steps to Develop Business Sense:
Immerse Yourself: Get out of the office and engage directly with users and customers.
Learn from Experts: Spend time with your most talented individual contributors and engineers.
Study the Market: Consume content from top industry analysts.
Leverage the Founder (If Possible): If you have access to the original founder, make the most of it. Learn to distinguish between essential and incidental elements.
Start reading: To start, read the messages on Slack for the past four months in the organization's critical channels. Examine the playbooks, starting from the most recent and working backward.
How to develop coaching skills
Once you have a solid foundation of expertise, focus on helping others develop rather than micromanaging or doing the work yourself.
Focus on 1-2 key areas for improvement at a time.
Reframe "direct reports" as "clients" to shift your mindset.
Utilize spectrums to help people explore different approaches. (e.g., "Imagine consulting no one vs. 100 people when making a decision.")
Connect Seemingly Disparate Issues: Help your team see the underlying patterns connecting different challenges.
Encourage Exploration: Resist the urge to provide immediate answers. Allow people to discover solutions through experimentation.
Decompose Limiting Beliefs: Help your team break down limiting beliefs into facts, inferences, and judgments.
Foster Continuous Improvement: Encourage your team to identify at least one new idea or behavior to try after each meeting, aiming for 1% continuous improvement.
Founder-Style Leadership: The Formula
Founder-Style Leadership = Product/Business Sense + Coaching
This potent combination empowers teams with the context, support, and autonomy they need to solve complex problems in ways that delight customers and drive business success.
By cultivating both deep product/business sense and strong coaching skills, leaders at all levels can embrace the principles of "founder mode" and unlock the full potential of their teams, regardless of whether they're building a startup or leading within an established enterprise.
