Leadership at your startup: The founder plus one philosophy

Founders aren’t afraid to fail and pivot their way to success whereas others think of risk mitigation. Illustration: Chaitanya Dinesh Surpur

Founders are a force of nature. They take risks whereas most others just accept the status quo. They aren’t afraid to fail and pivot their way to success whereas others think of risk mitigation. And they dream big, shake up fundamental industry structures and disrupt the status quo. So I fully support the primacy of founders. However, there were three problems with Paul Graham’s framing of the ‘Founder versus Manager Mode’ debate.

First, the concept was framed incorrectly as a mutually exclusive choice between a ‘founder and manager’. We all know the success formula morphs greatly at various stages of a company’s growth—$0-1 million, $1-10 million, $10-100 million and $100-500 million are very different journeys. And further still, the context around each stage (for example, regulatory environment, available talent, cash on hand etc.) dictates one’s degrees of freedom. So I’d contend that every good leader must operate at different points of the founder-manager spectrum depending on what the situation demands (now popularly known as the ‘Versatile Leadership model’). As per the Harvard Business Review, the percentage of overall leadership effectiveness related to versatility has spiked ~2x over just the past decade given our increasingly VUCA (volatility, uncertainty, complexity, and ambiguity) world. Success here comes from figuring out the key questions to answer plus a maniacal focus on prioritising which to solve and when.

There is another issue with the way Graham has framed the manager paradigm. When all professionals are cast with a broad brush as “skillful liars”, “fakers” and those who “drive companies into the ground”, clearly one should only embrace the founder mode. Yet, the 2023 CB Insights Venture Trends report estimates just 0.1-0.2 percent of startups reach $100 million-plus in revenues. Should that be interpreted as saying most founders are incompetent? If the Harvard Business Review finds that <9 percent of all leaders worldwide manage to truly nail versatile leadership, I’d argue perhaps a combination of complementary skills between founder and manager can help increase these odds.

Using Graham’s example of Steve Jobs, it’s worth noting Apple may not be as huge a scale success without Tim Cook’s contribution. Clearly Jobs was a once-in-a-generation visionary and created hugely disruptive products and a hallowed brand. But it was Cook who worked in the background organising Apple’s supply chain, procurement and ‘go to market’ to make each scalable, repeatable and predictable. This same partnership paradigm can be seen underpinning almost all of tech’s greatest growth stories (Facebook = Zuck + Sheryl, LinkedIn = Reid + Jeff, Google = Larry/Sergey + Eric). How many 100x companies can you name where just the founder made things happen solo?

Finally, the last gap centres around the envisioned partnership model itself. Graham’s description was inherently adversarial (‘micromanagement’). Yet, having been a founder myself, a scale-up operator and now a VC (each with their own successes and failures), I can personally attest for the fact that the trick lies in how the partnership gets constructed. There are times when the founder intuition trumps all else yet others where a manager’s systematic research and data lead to the big unlock.