3 ms·
Let's give founder mode the mathematician's treatment, generalizing it to something more well understood and then reexamining the specifics. To my ears, the dis
by knuckleheads 2y ago
Let's give founder mode the mathematician's treatment, generalizing it to something more well understood and then reexamining the specifics. To my ears, the discussion around founder mode can be heard as a discussion around a qualified principal-agent problem, where the principal is the founder and the agent is anybody and everybody else the founder has to bring on in order to further the founder's vision and desires for the business.
>The principal–agent problem refers to the conflict in interests and priorities that arises when one person or entity (the "agent") takes actions on behalf of another person or entity (the "principal"). The problem worsens when there is a greater discrepancy of interests and information between the principal and agent, as well as when the principal lacks the means to punish the agent. The deviation from the principal's interest by the agent is called "agency costs".
- https://en.wikipedia.org/wiki/Principal%E2%80%93agent_problem https://en.wikipedia.org/wiki/Principal%E2%80%93agent_proble...
This isn't a conflict that can be escaped, only managed, something inherent within any large organization, notwithstanding the specifics of the startups in discussion here. Hiring employees is hard and costs money that could otherwise be spent on the business or dividends back to founders and investors, and if founders could avoid having to hire others, they would. But, founders having a limited amount of time and specialization, must hire others lest the business die on the vine as opportunities pass them by for lack of available people/time to perform the necessary labor to take advantage of them.
The second and third sentence in that definition from Wikipedia is why I am writing this comment. Within the terms introduced above, I think PG is advocating that founder's should work harder to reduce agency costs by getting better at punishing their agents.
Punish is a strong term here to use for sure! However, if you ask the agents, i.e. the employees of the founder, much of the behavior advocated by proponents of founder mode is punishment. Micromanagement of projects, subverting the established lines of communication, second guessing the details of the agents' work and opinions, all of these things are often seen by agents/employees as undermining their agency and feelings of security within the organization.
Ask a product manager whether they actually want the founder to read and comment on all of the technical specs and reports the PM and their team produce and I imagine most of them would grimace. They would much prefer if the founder stuck to being given the "right" information by the PM and the founder presenting their feedback in the right settings/meetings. Going outside of that would restrict the agency of the product manager and might very much feel like a punishment. I've most often seen founders/higher ups get involved in a team's work directly and it was often as the result of the team fucking up and the "principals" feeling like they had to step in, do some light to heavy punishment through their involvement, and set things right.
Punish is still a harsh word to use here, but there is a fundamental conflict of interest that can't really be escaped. I'll make the assertion that most employees do not directly share the founder's interest in making the founder wealthy. Employees have their own interests, whether it be working on something cool, furthering their own careers, getting their own slice of wealth, or just having a steady job while they live life outside of work. The founder wants tools to win the conflicts that occur between the founder's desire to increase their wealth and the employees sometime desire to do an action that, in the founder's opinion, harms the chance of that happening.
To me, in my eyes, founder mode has been a implicit discussion of this conflict at the heart of the principal agent problem, with both sides talking past each other about the necessity and efficacy of common punishment techniques. Principals keep saying they need more ways to correct deviations from their visions and agents replying by saying that often times those corrections do more harm than good. Neither of them are wrong per se, but it does feel like a misunderstanding between the two groups that'll just cause more harm than good in the long run. Founders giving themselves leeway to indulge in punishing their employees for perceived deviations from the founder's interest will likely end in nothing worthwhile, while agents/startup employees resisting outright or implicitly any punishment/correction from the founder will likely cause the employee to get even more punishment.
The ideal successful founder experiencing success goes through a rapid metamorphosis from exceptional individual contributor, to team lead of a small team, to team manager of a large team, to a manager of managers of many teams, to department head of many such managers, to chief executive officer of many hundreds or thousands. At each stage, the founder needs to learn how to correct and prevent their employees from deviating from the founder's desired outcomes.
A lot of the replies from employees has been from within the context of their experience at the hands of founders who did not manage this transition and learning process well. The CTO that had to approve every pull request of the hundred person technical team, the CEO who had to interview every incoming employee and slammed the recruiting process to a halt, the founder who showed up to the team meeting and threw the product road map away and started over to the dismay of the engineering teams. Each time, the founder trying to keep the organization headed in the right direction, i.e. making the founder and the investors wealthy, but not really knowing how to do this well and fucking up in the process.
MBA's have a set toolbox for how to punish at scale in very large organizations that has been refined over centuries. Founders have tried applying this to their startups and found them to be lacking, too heavy handed and lacking in refinement for the smaller scales they are often operating on. Eventually, the founder hopes that they might lead an organization successful and large enough that they might need to use such tools, but for now, they are stuck making it up on the fly while also trying to do literally everything else. Part of the discussion of founder mode to me has been around founders having a discussion about how to actually effectively make these corrections at various stages of growth of a business.
I'll wrap this up by restating PG's point: the best founders know how to punish in ways that don't scale. The principal-agent problem will always be there, cannot get around it. My hope is that the discussion around founder mode is less about founder's giving themselves license to do whatever they feel like whenever they feel like it, and more around the development of a toolbox for founders to punish employees for deviating from the founder's goals that precludes what could broadly be considered abusive or ineffective.