Founder Mode: Surviving Your First 365 Days in Business

Founder Mode - Surviving Your First 365 Days in Business

Starting a business isn't just about having a great idea—it’s about surviving the highs and lows of building something from scratch. In a talk at Y Combinator, Brian Chesky of Airbnb emphasized the concept of Founder Mode. It’s the mindset needed to endure the early stages of a startup, and it contrasts sharply with Manager Mode, which can be detrimental in the first year.

At Chesky’s speech, many other founders shared similar experiences of being advised to hire more corporate managers and executives after their initial growth stages. This shift often led to significant setbacks, with some companies even nearing bankruptcy. While finding a balance between both methods is possible, it’s essential to remember what led to initial success. Jeff Bezos and Steve Jobs have both famously stated that they would run Amazon and Apple like massive startups, emphasizing the importance of retaining that entrepreneurial, risk-taking spirit even at scale.

Founder Mode

In Founder Mode, the stakes are deeply personal. Founders are not just financially invested but also emotionally and personally committed. Every decision made impacts their livelihood, their vision, and their future, creating a powerful sense of urgency. This mode of thinking prioritizes a long-term perspective; founders are willing to endure immediate challenges and discomfort because they believe in the bigger picture they are building. They have a vision for where they want their company to be in 5, 10, or even 20 years, and this vision becomes their compass.

Additionally, founders in Founder Mode have a profound emotional connection to their business. They see the company as an extension of themselves and care deeply about its culture, people, and outcomes. This emotional investment fuels their resilience and determination, pushing them to navigate setbacks and challenges creatively. A key characteristic of this mindset is the willingness to take risks. Founders in this mode understand that achieving significant growth often requires bold, decisive actions, even when outcomes are uncertain. They view risk as an opportunity for innovation and growth, not a threat to be avoided.

Manager Mode

On the other hand, Manager Mode prioritizes stability and short-term gains, which can be at odds with the needs of a startup in its early stages. Managers, especially those who join after a company’s initial growth, often prioritize career advancement and short-term performance metrics that enhance their resumes or performance reviews. Their focus tends to be on achieving immediate results rather than building towards the long-term vision that originally fueled the company’s success.

This approach can lead to risk-averse behavior, as managers prefer maintaining consistency and predictability over experimenting with new ideas or strategies. While this may create stability, it can also stifle the innovation necessary for a young company to scale. Furthermore, managers may lack the same level of emotional connection to the business as founders do. Without a personal stake, they may not push through challenges with the same tenacity or passion, potentially slowing down the company's growth. In the crucial early stages, a risk-averse mindset can hinder the progress needed to capitalize on opportunities and pivot swiftly when necessary.

To dive deeper into Founder Mode and how to navigate your first year in business successfully, check out my new YouTube video where I break down this topic in detail. Watch it here.

How to Win the First 365 Days

To thrive in Founder Mode and set your company up for success in the first year, there are key strategies you must adopt:

1. CEO Actually Means Chief Sales Officer: In the early days, your company’s lifeline is sales. Prioritizing sales above all else fuels growth and momentum.

2. Focus on High-Output Tasks: As CEO, your focus should be on tasks that yield the highest return on investment (ROI). Identify what moves the needle for your business and concentrate your efforts there.

3. Be a Decisive Leader: Quick decisions are crucial. Test hypotheses rapidly and pivot when needed. Engage with everyone in the company, as insights from all levels can reveal simple, scalable solutions. Remember, simplicity scales.

4. Build a High-Performance Team: Surround yourself with people who thrive under pressure and are motivated by incentive-based compensation. If someone isn’t a fit, fire fast. Trust your gut and act swiftly when needed.

5. Manage Expectations: Setting and managing expectations is vital. Be clear about targets, communicate openly, and adapt as you gain new insights about the market and your customers.

The first 365 days are about proving your vision and building a foundation for long-term success. Staying in Founder Mode allows you to remain agile, take necessary risks, and maintain a relentless focus on your mission.

If you’re ready to take your startup to the next level, I offer personalized 1-on-1 coaching to help founders navigate these early challenges. Book a clarity call here and start scaling today.