Start-ups succeed despite, not because of their founders’ management skills.

Many of the world’s greatest founders are pretty terrible at management, and yet their companies work wonders. The Jobs, Bezos, and Musks of this world are simply too many to ignore.

If you’re following the start-up scene, it is impossible to have missed Paul Graham’s essay on “Founder Mode”. It shook the waters in Silicon Valley, and sparked a wave of hot takes across boardrooms, tech Slack channels, and LinkedIn feeds around the world. 

In his essay, the investor and entrepreneur proposed a daring thesis. He challenges traditional management advice that emphasises hiring good people and delegating tasks, claiming it often leads to failure when founders apply it. Instead, he advocates for founders to stay deeply involved in their companies—a hands-on approach he dubs “Founder Mode”, and a stark contrast to professional management practices preached at business schools and management textbooks. 

“Whatever founder mode consists of”, Graham concludes, “it's pretty clear that it's going to break the principle that the CEO should engage with the company only via direct reports”. Pointing to the success of founders like Steve Jobs -a leader equal parts brilliant and relentless- he suggests that the new mode may be more effective for growing startups.

Even for Graham’s standards, nobody could have predicted the heat of the debate that would follow. 

Within days “Founder Mode” seemingly became both the cure and curse of business management. Some found Graham’s new framework brilliant and necessary when running a company, others blamed him for creating a cult that legitimises toxic micromanagement.

Graham’s tone may have been quite polemic towards managers, and his rough sketch of “Founder mode” a broad generalisation. But there is something in his argument that undeniably sticks: founders often defy the management playbook, and yet their companies work wonders. The Jobs, Bezos, and Musks of this world are simply too many to ignore.

In fact, if we’re being truly honest, Graham’s observation could go even further. Many of the world’s greatest founders don’t just ignore conventional management wisdom - they succeed despite actually being pretty terrible at people management. Musk is notorious for his erratic behaviour and overworking his teams. Bezos is known to have blistering outbursts against his employees. Jobs was famously abrasive, demanding perfection in ways that bordered on cruelty. In all three cases, that didn’t stop them from building companies that become world-beaters in their respective fields.

Regardless of your stance on the debate, it is impossible to deny that Graham’s essay sparked a necessary dialogue around the different styles of leading a company. In this week’s Uncensored, we highlight our own four key takeaways from the conversation around “Founder mode”, and explore what it can teach us about challenging established corporate thinking and improving the way we work.

🚡There’s no one way of running a company

Whether you agree with his take on “Founder Mode” or not, there was a deeper point in Paul Graham's article that is difficult to ignore: there simply isn’t a single blueprint for running a company. This stands in stark contrast to the standardised playbook approach laid out by management bibles and MBA programs, which champion very clear reporting lines, detailed managerial best practices, and insist on delegating tasks through hierarchical structures as the only path to success. 

The truth is, there are more ways to build a company than traditional corporate wisdom would have you believe.

To take this one step further, one possible flaw in Graham’s argument is that there probably isn’t one “founder mode to rule them all”. Founders are not a monolithic group. The most successful ones have brought their own personalities, industries, and unique pressures into the equation. As a result, their management styles have differed widely even if they all kept a founder’s attachment while running their companies. 

Steve Jobs’ obsession with product design was central to his leadership at Apple, while Jeff Bezos focused ruthlessly on data-driven decisions and scaling Amazon’s logistics. They both diverged from management textbooks when running their companies, but in different ways, and they both succeeded for different reasons.

All of this is to say that questioning or challenging the status quo of management shouldn’t simply be a subset of a newly found “founder mode”. It should actually be an essential part of improving management practices and optimising the ways we work. Conventional management principles have been practised for decades, but there’s no reason to believe they can’t be improved upon, or that all rules should remain rigid at all times or stages of a company. 

Founder-led companies often operate in this liminal space due to the pressures of scaling up - constantly trying to figure out what works best, and not just what’s been done before. This experimental approach may produce mixed results, from motivation to chaos or mass burnout. But if more corporate leaders were willing to experiment, innovate, and rethink their approach to management the way some founders are, it’s not difficult to imagine we would see more breakthroughs and improvements in the way we work.

🍼Defining founders: parents and other metaphors

It is very difficult to lump all founders under a single definition. It is almost impossible to come up with a single “founder” behavioural pattern. But if we want to take a look at what would characterise a potential “founder mode”, we must take a stab at defining what makes them unique. 

Brian Chesky, the co-founder of Airbnb whose talk largely inspired Graham’s essay, recently offered a metaphor that really resonates: founders are like the biological parents of their companies. They have a unique, visceral connection to the entity they’ve created. They’re not stepping into a pre-existing structure like professional managers, who assume the role of the caretaker or babysitter. They’re building that structure from the ground up, and their deep connection to the company means they can often steer it in ways that no one else can.

Chesky breaks down what distinguishes founders from managers into three key traits. First, as the company’s “biological parent,” the founder has a deep personal commitment to its success. Second, founders have full permission and legitimacy to promote change—they don’t need to seek approval or worry about stepping on toes. And finally, founders know how to rebuild the company, pulling the company through tough times and reinventing it when necessary.

A manager combining experience in companies led both by founders and by managers shared a similar, interesting insight with REBORRN.

“The biggest difference I noticed is that when you work in corporate mode with a manager-CEO at the helm, they are usually there for a limited number of years, so they tend to prioritise self-growth or the next step of their career,” she explains. “They bring a lot to the table that founders may not have, like best practices, but their decisions tend to be opportunistic and short-sighted. Founders on the other hand stay focused on impact, keep their eyes on the long-term, build a continuity mindset and can make quick decisions when it matters”.

Beyond the visceral, parenthood-style attachment to their companies that may lead them to success, there is an additional trait characterising most of the world’s great founders. They often possess a singular skill that sets them apart as outliers, a “superpower” that can propel their companies to success if they zone into it, despite unorthodox or bad management practices. 

For Steve Jobs, this may have been his unrelenting vision for simplicity and beauty in product design. For Mark Zuckerberg, this could be his innate instinct for building a social media that people really wanted to use - even though he recently admitted his preferred superpower would have been teleportation. For Jensen Huang, CEO of Nvidia, it may be an extraordinary speed at processing information: how else would he be able to receive over 50 direct reports, a complete violation of conventional management wisdom, which suggests that any leader should limit themselves to six or seven?

Founders are definitely not great at everything, but they are usually exceptional at one thing. It is this ability that often becomes the driving force behind their company’s success, even when their management practices leave a lot to be desired.

💀 The myth of toxicity

One of the loudest critiques against Graham’s essay was that when founders stay too involved, they inevitably become toxic leaders. It’s easy to see why many were led to that conclusion: examples like Elon Musk’s overbearing style have created a stereotype that “founder mode” equals micromanagement, overworking, a big ego and a lack of empathy. 

But there are also too many exceptions to make toxic micromanagement a rule. While some founders have fallen into these traps, others manage to strike a balance between involvement and autonomy. Some have even steered the “founder mode” leadership style into a completely different direction: offering a lot more autonomy than what “manager mode” would traditionally dictate.

Look no further than the example of the great, late Kazuo Inamori, the charismatic founder behind Kyocera and KDDI, two major success stories from Japan. Inamori coined a completely unique management model called “Amoeba Management”, under which companies were vastly decentralised entities by dividing the organisation into numerous autonomous small teams, with each team being held entirely responsible for its own results. Inamori’s managerial success was actually allowing all employees to get actively involved in its management, a complete antithesis to the paranoid hands-on approach that many associate with “founder mode”. For this to work, though, Inamori insisted that companies should rely on a certain type of person, the so-called 'spontaneously combustible employee”, meaning somebody that can get naturally fired up without much input or nudging.

Interestingly, some founders exhibit the opposite of the so-called toxic style in a different way—they can end up being too sentimental, as a manager who has worked for both professional managers and founders recently remarked. 

“A trap I’ve noticed with founders is their sentimentalism with people who may have helped them set up the business, and their difficulty understanding that they may not be the best people after a company has scaled up and grown” she said. Founders can become overly attached to early employees, even when they’re no longer the right fit for a growing organisation. 

In these cases, the issue isn’t toxic micromanagement—it’s actually loyalty to a fault. 

📚Studying how to rip the textbook

Not every founder’s unorthodox management style may be worth studying or replicating. But there are plenty of examples where founders threw the management textbook out of the window in ways that should at least pique a manager’s interest. Some of them show how management styles could adapt and evolve to make big companies replicate the energy of start-ups.

Graham includes a fascinating example in his essay when referring to Steve Jobs’s insistence to run an annual retreat for what he considered the 100 most important people at Apple. You probably already guessed it: these were not the 100 people highest on the company’s organisational chart. 

It is a practice that goes against the traditional playbook - but it is easy to see why it could help Apple maintain the dynamism and culture of a start-up.

If you weed out some noise, and some admittedly bad behavioural traits, there are actually a lot of similar case studies that could better inform management textbooks. Below are just three interesting examples to get us started:

🫡Reed Hastings’ “No-Approval Culture” at Netflix: Netflix’s famous culture of “freedom and responsibility” has become globally renowned, and a big part of that actually comes from Hastings’ own rejection of micromanagement. Managers at Netflix don’t have to sign off on decisions, and employees are empowered to make multi-million dollar decisions on their own without running them up the chain of command. The idea is that if you trust people to be smart enough to join your company, you should trust them to make decisions as well. This is the polar opposite of the command-and-control style of “Founder mode” and it simultaneously defies most traditional management playbooks. But it’s been a highly effective strategy for Netflix, fostering a culture of high performance and innovation without the typical corporate bottlenecks.

🔕Jack Dorsey’s “Silent-Meetings” at Square: Jack Dorsey, co-founder of Twitter and Square, insists that before any meeting starts, participants are required to read a carefully prepared document in complete silence for the first 10-15 minutes. This is a pure rejection of the typical PowerPoint-heavy starts at meetings, and the management doctrine that argues that getting people in the same room should always involve discussion, brainstorming or active use of their time in some capacity. But by front-loading the meeting with quiet, focused reading time, Dorsey argues that his teams are aligned, informed, and ready to engage in meaningful discussion. It’s an unusual tactic, but it’s cut down on the inefficiency and lack of focus that plague many corporate meetings.

🥾Jeff Bezos’ “Giant Shoe Award” at Amazon: It may as well be the most Amazon policy ever: every year Jeff Bezos personally handpicks an employee or two who exemplified the core values of innovation and bias for action, by creating something impactful outside their “day job”, and hands them a coveted internal prize called “Just Do It Award”. The award isn’t money, or a fancy placard: it is a Size 18 Nike shoe. But what may come across as pedantic or patronising is something really valued by Amazonians in their corporate culture, as evidenced by this testimony by a former Amazon principal engineer who received the famous shoe. It goes to show that there could be real, positive value in singling out impactful employees and rewarding their efforts in public, creative and humorous ways.

“Founder mode” may not yet exist as a separate school of thought for management - and it may never fully do. But beyond the grit and some terrible management practices, there seems to be more wisdom in the way founders run their companies than we have allowed ourselves to see. 

The shining examples of many founders should be enough to show that traditional management is not the only route to building world-building companies. Their trajectories prove that staying attached to your company and tapping into your superpower can help drive vision despite shortcomings. They also show that toxic micromanagement is not an inherent founder trait, and that some unorthodox management practices should really start becoming part of our textbooks. For every Jobs, Musk & Bill Gates, there's a Tim Cook, a Satya Nadela and an Eric Schmidt.

But whether you are a fan of “Founder-mode” or not, one thing is for sure: start-ups succeed despite, not because of their founders’ management skills.