The term Founder Mode seems to be the new viral slang this week. Introduced by English-American programmer and writer Paul Graham in an essay published by him on his website, the term refers to unconventional or lesser-known ways to run a larger company, or to scale up a start-up.
Drawing examples from the lives of successful founders like Steve Jobs and Elon Musk, Graham concludes that the key to growing a successful company is to be more involved in the company’s operations. This typically goes against what is being taught in business schools around the world — the conventional managerial approach.
So if the term Founder Mode is something that has intrigued you as well, here is a summary of what Founder Mode and Manager Mode mean, as per Paul Graham’s latest viral essay.
Founder Mode
The main characteristic of the Founder Mode is the active involvement of founders in all areas of their business, particularly during the early stages of company’s growth.
Graham argues that Founder Mode leaders are more hands-on and involved in the details, even engaging in "skip-level" meetings, where they interact directly with employees at all levels rather than just their direct reports.
“As Airbnb grew, well-meaning people advised him that he had to run the company in a certain way for it to scale. Their advice could be optimistically summarised as ‘hire good people and give them room to do their jobs’. He followed this advice and the results were disastrous. So he had to figure out a better way on his own, which he did partly by studying how Steve Jobs ran Apple. So far it seems to be working. Airbnb's free cash flow margin is now among the best in Silicon Valley," Graham wrote in his essay.
Manager Mode
On the other hand, the conventional and ‘managerial’ method of running a company is what Graham refers to as the Manager Mode.
Here, as he mentioned in this essay, the key is to ‘hire good people and give them the room to do their jobs’. This method is followed by most growing start-ups and companies across the globe.
Graham opines that this traditional style of management essentially discourages the active involvement of founders in the company’s operations in order for the start-ups to scale up — which is mistaken.
