Founder Mode vs. Manager Mode. It’s the latest trending topic based on an essay written by Paul Graham designed to give language to a seemingly common problem in many startups. Paul argues that there are two modes in which a founder can operate: Founder Mode vs. Manager Mode. Founder Mode refers to the leadership of a founder who can cast a vision, inspire and still be connected to those who they bravely lead, but not so connected like a manager. Manager Mode refers to the practice of “hiring good people and letting them do their jobs.” One mode invites the founder to maintain control over the organization whereas the other mode means relinquishing control and trusting in the ‘good people’ (however good is defined) and their decisions.
The crux of his argument is that ‘founder mode,’ once properly studied, documented,analyzed, and embraced, can work far better than ‘manager mode.’ Yet, is it really that simple? Will turning one mode off and turning another on lead to success in organizations?
While his attempt to name something that he is observing is commendable (after all, in many cases, you cannot change what you cannot name), his model is overly simplistic and has the potential to cause more harm than benefit.
Below are some of the fallacies of founder mode:
- Leadership as a fairy tale: Graham is surfacing a ‘tale as old as time’ in creating a mode for founders and citing Steve Jobs as an example of someone who graces the earth with his wisdom, confidence, and vision. What his argument does not consider is that being a leader has less to do with individual traits and more about the context (and the systems) in which the person now finds themselves. Stepping into a leadership role may have less to do with authenticity and empathy and more to do with how someone approaches questions, such as “How will decisions get made? When do I have the final say? What rhythms are needed to move towards our outcomes?” Continuing to believe in the fairy tale of heroic leadership can get in the way of a more systemic approach to change in organizations.
- Either/Or Thinking: Graham presents two options a founder can choose to be – Founder Mode or Manager Mode. You are either in control or you relinquish all control. His argument is similar to that of Frederick Taylor who described people as falling into two camps: those who give orders and exercise control and those who need to be controlled. One of the problems with either/or thinking is that it limits seeing the organization more holistically as a complex social system where the interactions between people are more important than just focusing on astutely wielding power and control over someone.
- Oversimplification of change – Graham underestimates the complexity of change in his model. Toggling between founder and manager modes doesn’t automatically fix the problem (whatever the problem may be). Removing or inserting an element or a person in an organization does not follow a neat recipe. It may affect some employees more than others – or have little to no consequence. Additionally, when you change something in an organization, something else may emerge that you did not anticipate – and what you try may or may not work at all. Founder Mode is not the quick fix that will transform and scale an organization because the truth is, quick fixes, like fads, fade over time.
If founder mode vs. manager mode does not work for the aforementioned reasons, then what will?
Broaden Your Starting Point
As a coach, I support and fervently believe in the ongoing development and growth of individuals. Yet, if you solely focus on the individual, then you risk staying “on the dance floor” for too long at the expense of having a fuller picture from “the balcony.” In other words, over-indexing on the ‘individual’ limits your perspective and understanding of the interactions shaping what is happening or not happening in the organization. As a result, the solutions you choose to implement may be incomplete or ineffective.
Instead, broaden your starting point by focusing on the organizational system, more specifically how individuals interact in that system. The organizational system refers to the formal and informal processes, policies, procedures and structures that guide, support and reinforce human behavior in that system. The system is a focus on the how, not just the ‘who’ in an organization – for example, how you plan, prioritize and carry out work, how authority is distributed, how you share information, how you define what gets rewarded.
Paying attention to the organizational system results in a more nuanced, comprehensive understanding of what’s going on – and that becomes the launchpad for experimentation. An experiment is a time-bound intervention that responds to a specific problem or opportunity. Its short duration (sometimes, just a few weeks!) enables rapid learning while reducing risk.
Experimentation is at the heart of change – learning from what works and doesn’t work as well and trying something new with the expectation that it will result in the change you wish to see in the organization.
Get on the Balcony
So what does getting on the balcony mean for founders? It means taking a step back and engaging the team in a practice like a retrospective, a meeting designed to pause and reflect on progress made (or not made) thus far. A retrospective is not a revision of tasks completed or not completed. It invites deeper reflection and multiple perspectives on how you’re faring as a team or organization and where there may be some gaps, misunderstandings, or an opportunity to try something different. It is an invitation to discuss your ‘default’ ways of working and explore which defaults you may want to change. What’s your go-to, automatic response, approach or protocol and how well is that serving you?
The meeting can center on three questions: What’s working well? What’s not working so well? (or What is holding us back?) and What are we learning? You can type up these questions in a Google Doc or other shared document and invite your team to write their responses during the meeting. You can then spend the majority of the time reviewing the responses, noticing where there is agreement or disagreement and where there’s opportunity for more discussion. Some questions you may want to ask to invite dialogue in the meeting include:
- What is contributing to our success so far? Why is that?
- What is unclear or defined about the way we are working right now? How is that lack of clarity affecting the work that gets done?
- Where is there an opportunity to make things 5% better in the next quarter/sprint/month?
‘Getting on the balcony’ and seeing the system more holistically may also prompt the need to ‘fix’ everything all at once right away. Rather than change everything, use the information from the retrospective to identify the areas where you’d like to experiment first. What is really getting in your way and what do you want to do about it?.
You might find, for example, that what’s really getting in the way is lack of clarity on when decisions come to you as a founder and/or when the team can make decisions. Rather than create a list of rules, challenge yourself to think about what the minimum viable structure might be for the team. When is it absolutely necessary for you to have the final say? How might you distribute authority to the teams/individuals closest to the work? Then, try an experiment that creates clarity on a type of decision that needs to be made. You can use language like “for the next month, for all decisions involving XYZ, person A or the team will decide,” “for all decisions involving DEF, person A or the team will decide, with my input first” and “for all decisions that affect ABC, I will decide.”
Take stock of what you learn at the end of the experiment. What was better as a result of the experiment? What didn’t change? What did you learn as a result of this experiment? And more importantly, what do you want to do about this experiment? You can continue to run the experiment to gather more information but make some tweaks, continue the experiment as is, sunset the experiment and/or move on to another experiment based on what you learned in the past month.
What you are building is a habit for experimentation in your organization that leads to small, incremental changes. It is those small yet deliberate steps that grow and transform the organization. Focusing on who the individual should be – founder or manager – can become a distraction from more meaningful, fruitful conversations on the system you are currently shaping – and the type of system you’d like to intentionally design in the future. In the end, the fallacy lies in believing that organizational success rests solely in the mighty hands and heroic vision of its founder.
What might be possible if that weren’t the case?