Founders Mode? Setting the Record Straight

Founders Mode + Scaling Mode = Leadership Mode

It’s time to weigh in and to set the record straight on the latest meme going around Silicon Valley called  “Founders Mode.” I will also take the opportunity to re-frame this whole argument to what we should be calling it = “Scaling Mode.” Finally, I will take the opportunity to connect these modes to an even higher mode =  “Leadership Mode” which is the reason for Cook’s PlayBooks existence.

Over the last few weeks, Paul Graham’s Founders Mode memo has fanned some new Silicon Valley flames. Unfortunately, the headlines and sound bites have ignited a debate that’s bordering on dangerous.

Why? Because whenever binary thinking enters the conversation, it quickly becomes polarizing. 

“This not that.” 

“Yes vs no.” 

“Success vs failure.”

“Founders are God.” 

“Traditional managers.” 

“Professional fakers.” 

While I respect the founders and leaders who have quickly latched on to “Founders Mode” as a new way of working, Paul Graham’s essay and the new found freedom being evangelized by founders is not the way of working Brian Chesky was describing in his panel talk that ignited all this.

Even worse, I’ve seen some really bad founder extreme thinking and bad behavior creeping into the conversation. Others have already pointed out the strawman nature (logical fallacy thinking) of Paul G’s essay referencing “Traditional Manager Mode.” Bottom line, Founder vs Traditional Manager is not the proper comparison and serves to polarize vs actually finding the proper “mode” of operating.

Founders Mode left unchecked and unconnected to what I’ll be calling Scaling Mode throughout this post will surely end up on the trash heap of Silicon Valley advice that many remember such as “Get Big Fast” and “Only Eyeballs Matter” (1999-2000), “Growth at All Costs” (2015-2020), “Get Rich Fast SPAC’s” (2021), and “Profitability Now” (2022-today) to just to name a few. I think we’ve proven to ourselves by now that nothing much good comes from polarized, extreme thinking.

It’s time to connect ”Founders Mode” with what I’m now going to name “Scaling Mode” - a core tenant of my own 30 years of being a Silicon Valley operating expert where I served as an executive leader scaling operations from Series A to IPO of companies like Intuit, Netflix, and Mozilla Firefox while also scaling and failing (“learning lessons”) at huge growth companies like Wineshopper and Orbital Insight.  

“Scaling Mode” is why I started Cook’s PlayBooks to pay forward all the lessons I’ve learned over 30 years of scaling such companies. Along the way, I’ve worked with dozens of founders and external CEOs of all types. I’m quite confident I’m speaking from a seat of credibility when it comes to trying to name these various “modes” of scaling a startup.

One of the most important goals of this post is to correct the record by simply “going to the tape” and unpacking what was actually said by Brian Chesky vs what has been translated and attributed to Brian in just the last few weeks.

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THIS POST IS FOR YOU…
If you are an experienced, external leader/executive operator and wondering if or when your founder may soon invoke “Founder Mode”… this post is for you.  

If you are a board member or influential VC scratching your head with your own experience and intuition telling you “Founders Mode” isn’t quite right… this post is for you.   

If you are a founder or VC promoting Founder Mode and waiting to tear this post apart in an attempt to invalidate it… then this post is also for you. I’m happy to enter a very vibrant debate as needed.

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Many are saying Brian’s panel talk that sparked all this was not recorded on video and therefore has not been posted on the web. Unfortunately, that’s just lazy research.

The good news is Brian spoke about this exact Founders Mode 9 months ago in a video interview with an extremely popular podcaster Lenny Rachitsky. I’ve linked this video below to ensure the record gets set straight on Founders Mode. 

Listening to Brian, it’s clear he is NOT promoting “Founder Mode” the way it’s being attributed to him and flung around social media and the web over the last week. I’ll argue Brian is actually promoting his own “Learning Mode,” which appears to be the polar opposite of “Founders Mode” from Paul Grahams essay. Brian’s “Learning Mode” incorporates many aspects of “Scaling Mode” I’ve been covering weekly in Cook’s PlayBooks.

“Founder Mode” +  “Scaling Mode” = “Leadership Mode.” Hard stop.

Scaling Mode is not binary. It’s not this or that. It’s simply scaling properly as company’s grow from founders stage to public enterprise stage. If a founder wants to go back to “founders stage” and the corresponding Founders Mode, that’s fine. This is usually done during a complete company pivot or major reorganization but to be clear Founders Mode is NOT a permanent mode.

Scaling mode is about introducing the lightest weight systems and structures during critical growth stages and then versioning these systems/structures from “good to great” to enable your company to operate with higher quality and higher velocity decisions.

Scaling Mode means continuously integrating the founder's vision with a structured delegation and decision model while promoting innovation, ownership, and accountability within the proper leadership structures.

Yes, founders need to maintain their connection to the business and their connection to the product they created and the continuous innovation of their product. Founders should never get unconnected from the business. Being connected to the business is very different than the recent “Founders Mode” being described.

Founders, I’m speaking to you. Maintaining such a connection does NOT mean taking back over all functions and making all the decisions for functions you don’t have expertise in. Don't take my word for it. A little later in this post I’m going to quote Brian Chesky directly to ensure the record is corrected on what he means by Founders Mode.  

Yes, the founder should always be the ultimate leader of vision, mission, and critical strategic decisions in their company. However, the founder will fail if they try to be the leader in all aspects of the business. There is no founder that I know or who I have ever met that knows how to properly structure and execute all critical functions such as engineering, product development, sales and marketing, and finance just to name a few.

The founder who embraces “I’m in Founder Mode” and therefore “I’m now the anointed czar of all these functions” will fail.  Hard stop.

So, let’s get into the proper blending of Founder Mode and Scaling Mode with an effort of intersecting my own Cook’s PlayBooks whose focus is simply “Leadership Mode.”

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Both “Founder Mode” and Cook’s PlayBooks stress that a founder's deep connection with their company is crucial for maintaining innovation and the startup culture. However, where “Founder Mode” warns against delegation—suggesting that too much distance can lead to professional fakers thriving—Cook’s PlayBooks emphasizes a properly balanced Leadership Mode where authority is delegated effectively with strong systems of accountability to ensure a company can scale while retaining their startup culture of innovation and ownership at all levels.

In Cook's PlayBooks, my thesis centers around linking and aligning Strategy, Structure, and Execution to successfully scale from Series A to IPO or “Scaling Mode.”    

Strategy: Founders must set the vision and strategic direction. This is where Founder Mode thrives—by ensuring the founder stays involved in high-level decisions, so the company retains its innovative edge.

Structure: As the company grows, founders must create a structure where key leadership positions are delegated to trusted, specialized operators—those who can take the founder's vision and execute it effectively. These leaders are held accountable not only by the founder but also by the structure and execution of their teams.

Execution: Delegation does not mean stepping away. Founders should regularly check in with leaders, understand their challenges, and review their progress while being able to offer course corrections when necessary. Skip-level meetings, as suggested in Founder Mode, can be instrumental here. Founders can and should always feel comfortable connecting with leaders of leaders, a few levels down in the org, to ensure that the company’s product vision and innovation culture still lives at these lower levels.

A Balanced Approach to Founder Mode vs Scaling Mode:

While Paul Graham's essay on “Founder Mode” suggests a founder’s deep involvement is crucial to avoid disengagement, it also implies a potential over-reliance on the founder, which can lead to very bad leadership behaviors.   

In contrast, Cook's PlayBooks encourages “Leadership Mode,” a balance between starting something (founder involvement) and scaling something (scaling mode) by delegating ownership, authority, and decision making down the risk curve of the business.

This delegation must be to specialized operators, whose expertise drives the company forward without sacrificing the founder's vision. I’ve never met a human being much less a founder who is a specialized expert at all functions of a company.   Invoking “Founders Mode” into these specialized functions is a recipe for disaster.

This balance is crucial when scaling, as the founder cannot make every decision or attend every meeting. They must place their trust in key leaders but always remain connected enough to guide and steer the ship when needed. There are specific ways (frameworks and playbooks) to do this that I talk about in Cook’s PlayBooks. More importantly, Brian Chesky himself also has provided specific key points on what he has learned through is own leadership journey.

I’ve written before about “Trust Requiring Transparency” while scaling a company. Trust is what’s really at stake here in this Founders Mode debate that began by “not trusting traditional managers and professional fakers.”

There is no “I” in “Team”

“Teams win.” 

“If you want to go fast, go alone. If you want to go far, go together.”

Transparency can be accomplished by creating the proper systems and structures inside an organization. Create your own transparent systems of accountability and you will go a long way to solving “Founder Trust” and a long, long way to true “Leadership Mode.”

A few key points here for Trust and Transparency:

1. Hire the Right Leaders: Hire experienced leaders with track records of being a “Founder for their Function.” Has this person demonstrated building and scaling their function through multiple scaling stages while maintaining innovation and culture? If so, hire them on the spot, and then empower them to do it again while also holding them accountable to you, the founder. By all means, give them the authority and hold them accountable to lead their respective teams.

2. Create Transparent Feedback Loops: Create consistent decision making systems (see my Decision Making Series). Document the details and force everyone to “show their work.” Don’t be lazy. Perform regularly structured and ad hoc check ins based on these documented decisions and assumptions. You, the founder or leader of your specialized function will stay connected without needing to manage every detail.

3. Structure Ownership & Accountability at All Levels: Leaders at all levels must be held responsible for the people they hire, their transparent documentation of their work, and to push ownership down in the organization to ensure that even the lowest levels of the organization are aligned with the top level company’s strategies, goals, and cultural behaviors. Proper structures actually create time savings and allows the founders and leaders at all levels to scale their influence without micromanaging.

4. Founders and Leaders as Coaches or Captains: In sports, the head coach (founder/leader) sets the overall strategy and vision for the team. They don’t make every play on the field but provide the guidance, direction, and accountability structure to ensure that players (specialist leaders) execute the plays. Founders and leaders need to create a system where they trust their specialized operators to handle day-to-day execution, while remaining involved in the broader strategic vision, one way door decisions, and to course correct company priorities when needed.

5. Specialized Operators: In military special operations, generals (founders and execs) aren’t involved in every mission, but they select highly trained operatives to lead specific missions. These operators have the autonomy to make decisions on the ground, but they are always accountable to the overall mission and objectives set by their leaders. The same applies in scaling startups—specialized leaders are the “special forces” who execute the founders and execs vision with agility, while still being accountable to the founder/exec for their success.

Conclusion

Great founders and executives act as coaches and generals by ensuring the right team is in place to execute while maintaining a direct connection to the strategy and vision that got them to where they are.

Scaling a startup from Series A to IPO requires a balance between maintaining the founder’s connection to the company and ensuring that leadership at all levels is effective. Founder Mode offers valuable insights into how founders can stay engaged, but it should not be viewed as a binary opposition to delegation. Instead, successful scaling requires linking strategy, structure, and execution in a way that holds leaders accountable, empowers specialized operators, and allows the founder to focus on high-level innovation while maintaining the founder’s pulse of the company’s vision, strategy, and one-way door decisions.

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I promised I would “go to the tape” and fact check what Brian Chesky actually said and that is now included below.

But first let’s go to Paul Graham’s own essay, who many haven’t actually read. Buried toward the end is Paul’s own quote below, he admits these very facts that founders must change the way they run companies as they scale vs “reverting to Founders Mode” and moreover, he (Paul) hasn’t figured out what Founders Mode even is yet? 

I do agree with Paul on “Manager Mode” or “Traditional Manager Mode” as that’s not the reality in the vast majority of startups who are scaling for growth. If that “mode” is in your company, you have much deeper problems.

“Obviously founders can't keep running a 2000 person company the way they ran it when it had 20. There's going to have to be some amount of delegation. Where the borders of autonomy end up, and how sharp they are, will probably vary from company to company. They'll even vary from time to time within the same company, as managers earn trust. So founder mode will be more complicated than manager mode. But it will also work better. We already know that from the examples of individual founders groping their way toward it.

Indeed, another prediction I'll make about founder mode is that once we figure out what it is, we'll find that a number of individual founders were already most of the way there — except that in doing what they did they were regarded by many as eccentric or worse.”

Paul Graham, Founders Mode Essay

Here’s Brian Chesky’s “Founders Mode” interview with Lenny Rachitsky from 9 months ago (Nov 2023). I listened to all 1 hour and 15 minutes intensely to ensure I understood what Brian’s view of “Founders Mode” is.

I have bookmarked this on my own Cook’s Playbooks YouTube Channel - “Founders Mode” - for easier future reference and embedded it into this post. Go back and listen to it after you read my summarized notes that follow.

Cook's PlayBooks YouTube Channel

Here are the notes and quotes I’ve summarized if you are feeling time constrained:

Brian Chesky Quotes: BELOW

Note: I added the “by’s, to’s, and’s” to properly connect Brian’s words and make them flow.

”Stay Connected and Involved in the Business”

By

”Connecting the Business”

To

”Deliver Clarity”

By

”Making Sure Every Exec is an Expert in Their Domain”

And

“Making Sure There Is A Roadmap” (not just at top level but at every level of the company & connect and operate to these roadmaps; Cook’s PlayBooks)

By

“Documenting and Reviewing All Work” (“Transparently Showing the Work” - Cook’s PlayBooks)

Chesky goes on to say:   

“There’s a difference between micromanagement and being in the details.” 
If you don’t know the details, how do you know if the people are doing a good job?

”This ideology and methodology can work for everyone but not everyone needs to run it at 100%.”

Brian’s top 12 points he summarized at the end of the video:

1. CEO = Chief Product Officer

2. Every Product Manager is interconnected… and should never be independently siloed.

3. Every leader should be an expert in their area. Don’t hire “people managers” only.  You can’t and shouldn’t manage people if you don’t know how to do their work.

4. Be as lean as possible at every stage and in every team.

5. 5 teams should do 1 thing… vs 1 team doing 5 things.

6. Use data + research & intuition; “You can’t delegate understanding.” Intuition comes from understanding.

7. Engineering and Design should report to a founder/product-led person… unless product person is the designer.

8. Product managers are a combination of art + science.

9. Marketing & Engineering need to be interconnected.  

10. Every direct report of my direct report… is essentially my direct report.

11. Each release is a chapter of the story or episode of the TV series.

12. Everyone needs to always row in the same direction.

 ”One Shared Consciousness”
My own note here: Think clearly about what Brian is saying here. A “shared consciousness” is not the “Founders Mode” that’s being attributed to Brian in the last week.

”I certainly hope I continue to learn and always be a beginner.” 
If 100% of what I say here is what I still believe years from now, then I likely haven’t learned anything. If only 70% of what I’m saying now I still believe, it means 30% has changed... it means I’ve learned something.  

“I sincerely hope I retract or change or modify something I’ve said here today in a few years. This will mean I have gained more wisdom.”

Brian refers to the following blog from Ben Horowitz (a16z) from 10+ years ago and repeats many of Ben’s great points including a few of my favorites:

Ben Horowitz (Oct 2013);  The Product-CEO Paradox

https://a16z.com/why-founders-fail-the-product-ceo-paradox/

• Be the integrator

• Write it; don’t say it

• Don’t communicate direction outside of your formal mechanisms: “Ad hoc communication to individual engineers and product managers is fine… but resist the attempt to jump in and give direction in these scenarios. Only give direction via a formal communication channel.”

“The Product CEO Paradox: The only thing that will wreck a company faster than the product CEO being highly engaged in the product is the product CEO disengaging from the product.”

Ben Horowitz, a16z

What Brian and Ben are clearly describing here is not the “Founders Mode” we are hearing about this week. They both are very accurately describing “Scaling Mode.”

Notice how both espouse how documenting everything and “writing it down” is the key to transparent leadership and transparent communication which leaves very little room for being disconnected or everyone not rowing in the same direction.

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My 3 asks for everyone who has read this far:

1. Understand what Founder Mode really IS and IS NOT - based on Brian’s own words and my own comparisons here to Cook’s PlayBooks and ”Scaling Mode”

2. Embrace Scaling Mode as Brian, Ben, and I describe in Cook’s PlayBooks

3. Now go connect them both. Founders Mode + Scaling Mode= LEADERSHIP MODE.   

You don’t have to be a founder to be in Leadership Mode. Any external “professional executive” can and should also be in Founders Mode for their area. Yes, if you are a “Traditional Manager” or an unconnected founder from your business, you need to change now and to implement most of the best practices described here.

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More reading for those that want to continue the research:

Paul Graham’s Original Essay:  

Dave Feldman: Founders Mode - Tech Leadership Crisis

Steve Newcomb:  Product-CEO Paradox

Dave Kellogg: Founders Mode

RawSignal Group: When Somebody Tells You There Are Only 2 Types of Leaders I worked very closely with Johnath and Shappy at Mozilla. Their take on most everything is amazing and their take on Founders Mode is as they say “very spicy”

Please feel free to leave a comment or additional good links and I’ll happily update the list above.