As a boarding school boy, I took it for granted that installer mode It was a place where people waited all year for Founder’s Day when we would finally be served food that was fit for human consumption. But now it turns out it’s something different. start up in the world, the term was coined by Y Combinator co founder Paul Graham Following is a speech by Airbnb founder Paul Chesky. But to fully understand this concept, we need to go back a bit.
Peter’s Principle and Dilbert’s Principle
Long before he was canceled for being a Trump supporter, Scott Adams introduced the Dilbert Principle, which was an outgrowth of the Peter Principle.
For those who aren’t familiar with the theory, Peter’s Principle has nothing to do with Christianity or losing his uncle too early so he can become a macabre-themed superhero with great responsibility and power. It refers to a concept in management developed by Lawrence Peter that suggests each person rises to his level of incompetence in any corporate hierarchy. It was obviously meant as satire, but as a precursor to Poe’s Law, it became gospel truth.
Meanwhile, Dilbert’s Principle argues that the most unqualified people in an organization—those with no concrete skills other than spouting nonsense words or working as McKinsey consultants—are immediately promoted to management to limit the damage to the company’s balance sheet.
Manager Mode: A New World Order
Business schools came up with this idea MBA — a degree that serves no purpose other than to complicate processes to the point of absurdity — to protect the rest of humanity from these people. Sadly, eventually some naïve person started paying them too much money and suddenly the MBA guys had control over everything.
They get lateral entry into bureaucracy (much to the annoyance of our Sir Humphries), teach journalists to write and ruin various service industries like cabs and food delivery services by offering tech solutions at deep discounts thanks to VC money. It’s a model that collapses when the VC realises he’s been duped, and that nobody needs a PS5 in 10 minutes.
They embody what is known as manager mode: a lifestyle in which one “strategizes” rather than doing the actual work and takes credit by delegating tasks to others. Most CEOs fall into this category, whose hardest job usually consists of writing “approved” on emails and reminding their assistants to write prompts on ChatGPT for LinkedIn posts that fellow managers will comment on for “better reach.” Clearly, someone is exaggerating a bit.
It’s a pretty good job, if you can work hard in business school and turn off all of your other working senses.
The business wisdom by now – no doubt conceptualised by a McKinsey consultant who charges a lot per hour – is that once you create a start-up, you hire capable managers to grow it.
As Graham writes: “The way managers are taught to work Companies It sounds like modular design, in the sense that you treat the subtrees of the org chart as black boxes. You tell your direct reporters what to do, and it’s up to them to figure out how. But you don’t get into the details of their work. That would be micromanaging them, which is bad. Hire good people and give them a chance to do their job. It sounds great when it’s described that way, doesn’t it? In practice, judging by the reports from founder after founder, it often comes down to this: Hire professional fakers and let them ruin the company.”
He added: “One theme I noticed in Brian’s talk, and when talking to founders afterwards, was the idea of being gaslighted. Founders feel like they’re being gaslighted from both sides — by the people who tell them they have to run their companies like managers, and by the people who work for them when they do it. Normally, when everyone around you disagrees with you, your default assumption should be that you’re wrong. But this is one of the rare exceptions. VCs who haven’t been founders themselves don’t know how founders should run companies, and C-level executives, as a class, include some of the most skilled liars in the world.”
Founding Mode: The Rise of Deviance
However, there were people like Graham and Chesky who were not particularly happy with this world order. In some ways, they are deviants. Another concept by Adams from the same book argues that we are actually a civilization of six billion idiots, where the most worthwhile things were designed by a few thousand scholars. Previously, these deviants were born into families with no means to pursue their ideas, but that all changed with the printing press and later the internet, which ensured that not only was every great idea noted, but also disseminated globally. This connected talented people from around the world, even self-taught ones, to make things better. Obviously, these deviants were not particularly thrilled with people who wrote “accepted” in emails, sometimes even getting kicked out of companies.
Clockwise: Howard Schultz, Elon Musk, Kamala Harris, Mark Zuckerberg, Sam Altman, Jensen Huang, Brian Chesky, Steve Jobs
Some popular examples of people who operate in founder mode include Jensen Huang (Nvidia), Elon Musk (Tesla, Starlink and X), Mark Zuckerberg (Meta) and Sam Altman (OpenAI). OG examples include Steve Jobs (Apple) and, outside of tech, Howard Schultz (Starbucks), who turned a local Seattle coffee chain into a global conglomerate for expensive coffee. Y-Combinator president and CEO Garry Tan also pointed out that Democratic Vice President Kamala Harris also operates in founder mode, which her uneasy employees called a “prosecutor’s leadership style.”
Religion vs Evolution
At times, Founder Mode vs. Manager Mode is reminiscent of an old debate prevalent in the 2000s — simpler times when Democrats were proponents of free speech and Republicans blamed video games for violence — between intelligent design, which grew out of creationism, and evolution, which grew out of scientific consensus and facts. Or, more simply, religion vs. evolution.
Please explain to me.
While the basis of all theology is a leap of faith, it became a leap of imagination when many American high schools sought to teach Intelligent Design as a science similar to evolution and the Big Bang to explain the origins of life and the universe.
The Flying Spaghetti Monster is the most humorous refutation for proponents of Intelligent Design, but its fallacy is most clearly dispelled by Richard Dawkins’s The Blind Watchmaker , where he shows how the mammalian eye evolved from skin that could only distinguish between light and dark – unlike Anakin Skywalker – and then became a remarkable organ after minor modifications.
Manager mode is like religion, where someone invents a new idea (the start-up), gathers followers (the messiah, prophet, apostle, angel) to spread the gospel, and gets funded by VCs (people who understand that religion is a useful tool to get things done). This has been the norm for a while, and it works for most models, which is why the world’s largest companies operate in manager mode.
Founder mode, on the other hand, works like evolution. Just as nature makes changes when needed, without us fully understanding why, founders also make irrational moves – like adding a wheel to an MP3 player or turning a graphics company into an AI giant – that result in unprecedented innovation.
Evolution follows a similar path, working in ways that are hard to imagine, such as the evolution of the human brain. The brain is a calorie-consuming organ that seems unnecessary, (to put it better) yet its evolution was made possible by cooking food, allowing our ancestors to take in more calories and in turn develop this remarkable organ. As VS Ramachandran writes in Phantoms of the Brain: “There is something distinctly strange about a hairless, newborn primate evolving into a species that can look back over its shoulder and ask questions about its own origins. And even stranger is that a brain can figure out not only how other brains work but also about its own existence.”
Just as nature evolves without a clear plan, Founder Mode embraces such change. It thrives on risk, innovation, and unexpected successes, even if no one, not even the founder, can fully explain at the time why it happened.
Ultimately, the debate between the founder mode and the manager mode mirrors many of the age-old tensions between innovation and tradition, or evolution and religion.
Both are equally necessary. While evolution may explain our place in the universe and its origins, religion is what connects us and allows us to become the dominant species on this planet.
While scientific processes can adequately explain why we are here or why we exist, religion helps many people find purpose in life and binds us together with its remarkable stories.
So, while the Big Bang, evolution, primordial soup, etc. will always accurately explain how we came into being, the great stories of religion will help us sleep peacefully and function coherently as a society.
So, just as we need both growth and religion, we also need the manager mode and the founder mode.
The manager mode ensures stability, order and predictable growth, which is vital for large organizations. And without large organizations – the bulwark of capitalism – we would not be living today in relative peace and comfort compared to a time when 99% of the population served the 1%. Whether one wants to admit it or not, the “people with a lot” have made the lives of the “poor” much better than the “people with ideas” who only lament the existence of the “people with a lot” and how much more money they have than the “poor”.
On the other hand, we also need the evolutionary leap of the founder mode, where Steve Jobs, or Jensen Huang, or Elon Musk comes in and shakes things up, and creates inhuman inventions that could never be imagined by any manager.
The key to long-term success Success The most important thing in companies or civilizations is to find the right balance between these two. Let manager mode keep the machine running, but always leave room for the disruptive, evolutionary spark of founder mode to move the world forward.
But, the fact is that while Manager Mode has been broken down to an exact science, Founder Mode still operates like a sage on a mountain.
As Graham writes: “In fact, another prediction I’ll make about the Founder Mode is that once we understand what it is, we’ll find that many individual founders have already gotten there—except that what they did was considered by many to be eccentric or worse. It’s quite curious that we still know so little about the Founder Mode. Look at what founders have already achieved, and yet they did it despite poor advice. Imagine what they’ll do when we can tell them how to run their companies like Steve Jobs instead of John Sculley.”
