It’s also true that as one of these disruptive companies matures and faces challenges, the founder has a unique ability to make bold moves and stick to the original vision when others are urging a less risky course. There are certainly cases where companies have struggled when founders have been replaced by managers. Remember Yahoo? And of course there’s Apple, where the founder came back and restored the company to its former glory and more.
But there are plenty of counterexamples. Apple has no problems under Tim Cook. Or consider Microsoft. Its CEO since 2014, Satya Nadella, has been a lifer at the company, toiling in various departments since 1992. Not a founder, no. But he has taken the company to fresh heights. Although Bill Gates is still revered at Microsoft, no one at the company wants him back at the top.
And God knows there are plenty of cases where it wasn’t crooked management but stubborn founders who ruined a company. I suspect Travis Kalanick could benefit from listening to dull managers. His successor, a managerial type guy, made Uber profitable.
The truth is, not everyone is Brian Chesky and no one is Steve Jobs. The expansive majority of companies never get off the ground and instead fall into disgrace. Very few founders reach the point where investors demand that they retain adult supervision to manage growth, because only the rarest of companies reach that point.
It’s fun to talk about founder mode, perhaps for the same reason some of us read Ben Horowitz’s nose-to-window-porn founders. The founder mode that Graham predicts will one day find its way into executive writing actually applies only to the most exceptional founders, the ones Steve Jobs once described as “crazies.” Their companies are called unicorns for a reason.
Time travel
In 2007, I joined a Y Combinator cohort of 12 companies. (Starting next year, there will be four cohorts a year, with hundreds of startups.) It was clear by then that Graham, who was incredibly hands-on, had evolved his views on the primacy of founders. My story appeared in Newsweek under the headline “Boot Camp for Billionaires.”
Every Tuesday during the program, Y Combinator hosts a chili or stew dinner for startups. At the first, Graham and [cofounder Jessica] Livingston hands out gray T-shirts with Graham’s slogan: MAKE SOMETHING PEOPLE WANT. A second, black T-shirt is given only to startups that achieve a “liquidity event”—either an acquisition by a larger company or an IPO. The T-shirt says: I MADE SOMETHING PEOPLE WANT.