The female ‘founder mode’ double standard

After Paul Graham’s viral “founder mode” essay, there’s now a new debate about the double standard that prevents female founders from operating their startups as their male counterparts do.

From the moment Paul Graham dropped his essay on “founder mode,” people online analyzed it like a stone tablet found bearing the new commandment of startupdom.

The essay argues that there are two ways of running a growing company. Founders may turn their organizations into a seven-layer dip of managers upon managers, isolating the entrepreneur from anyone but their direct reports. Or, they may choose to remain tangled up in every aspect of the business, sweating the details and meshing with employees across the organization.

Graham’s meditations on management sparked an immediate debate. From Tobias Lütke of Spotify to Baron Davis, a retired basketball star turned investor, cheered Graham’s rationale from the sidelines. Others, like Chamath Palihapitiya and Jessica Lessin, chastised the advice as unoriginal or too sweeping, pointing to Tim Cook and Satya Nadella as exemplars of manager mode done right.

But there’s one group that has been privately wrestling with “founder mode” since before it had a meme-able name: female founders.

For women whose own companies scale, being hands-on comes with a unique set of challenges and criticisms. Four female founders told Business Insider that a stark double standard prevents them from operating their startups as their male counterparts do. Behavior by male leaders that’s lauded by peers is often perceived as cruel, disturbing, and toxic when there’s a woman in charge. There’s also a looming fear that if these female founders make a misstep and are seen as too demanding or ruthless, they’ll be pushed out by their boards or canceled by the media. Every action and decision is relentlessly scrutinized, leaving little room for error or second chances.

“You could deliver every result in the world and they’ll still find the one thing you didn’t do,” Amanda E/J Morrison, chief executive of Julie Products, a healthcare brand that sells emergency contraception, said of some investors. “But I just think to myself, somebody funded Adam Neumann again.”

Sophia Amoruso, the original #Girlboss who penned an autobiography of the same name, recently wrote on X, “For them, it’s called Founder Mode, and it’s celebrated (a proper noun! With its own merch! And trademarks being filed as I write this!). For women, it’s called ‘toxic.'” Bumble founder Whitney Wolfe Herd wrote on Instagram that she was “in founder mode for 10 years and got attacked for it every single day.”

‘An impossible needle to thread’

When Morrison of Julie Products read the reactions to Graham’s essay, she thought about her lessons at business school a decade earlier. Her takeaway was that something had gone wrong if a founder stayed in the weeds after a certain period. “‘You’re not giving people space to do their jobs, you’re focused on the wrong thing, you’re a micromanager,'” she said. “We’ve made it very negative to be detail-oriented.”

Graham’s founder-mode endorsement implies that a company’s secret weapon is its founder, with his or her sixth sense of what the company needs to succeed. Founders who run their companies in founder mode keep a tight grip and do things their way as the startup grows because of this self-confidence. “This idea that you just find great people and let them run — they’re never going to want it as much as you,” said Clara Brenner, a cofounder and managing partner of the Urban Innovation Fund, a venture capital firm that invests in startups shaping the future of cities. “They’re never going to see the big picture the way you do. And so you have to be involved. They do, too.”

Yet, Morrison said she’s met resistance putting founder mode into practice.

When she first started Julie, Morrison pitched stores like CVS to get her company’s morning-after pill on shelves. Having a retail background, she loved this part of her job. But when her investors encouraged her to hire a head of retail, which would free her up to focus on strategic vision, she obliged.

Then, that employee left earlier this year, and Morrison chose to absorb her responsibilities rather than replace her. “I am supposed to be in this and this is what I’m supposed to be doing for the company right now,” she said. “But the fact that I had so many conversations about it and people had so many opinions, it happens all the time.”

In founder mode, making unpopular decisions for the long-term good of the company is part of the job. Christie Horvath, whose startup Wagmo allows companies to offer pet care coverage as an employee benefit, said some bristled at her plan to bring leadership back to the office. It paid off, she said, and Wagmo’s bring-your-pet-to-work policy is a key differentiator for top talent.

Horvath noted that as a female leader, there’s an expectation for her to be nurturing and empathetic. However, effective leadership often requires taking actions that can sometimes contradict these stereotypes. This can be particularly challenging at Wagmo, where many employees are drawn to the company precisely because it is female-led. Yet, Horvath remains steadfast in her authentic approach, so much so that “keep it weird” has been enshrined as an official company value.

To be sure, not everyone has co-signed founder mode as a better way of running a startup. Anna Barber, an investing partner at M13 Ventures, said the best leaders are those who can switch modes from manager to founder and blend as needed. They evolve to become the right leader that their organization needs at each moment.

“So as an investor, I am not looking for founder mode,” Barber said, “but it doesn’t shock me at all that women are feeling like they don’t have permission to do that. I mean, think about the speech in the ‘Barbie’ movie. It’s an impossible needle to thread.”

Daring to be disliked

Graham’s essay comes amid a recent trend of founders reclaiming control, according to Jenny Fielding, cofounder and managing partner of Everywhere Ventures, a venture capital firm that consistently ranks among the most active pre-seed investors. In a pandemic economy flush with capital, companies that scaled up rapidly hired middle managers with abandon. This led to a spate of mediocrity. “They’ll just toe the company line rather than push boundaries,” Fielding said, “because they’re worried about things like bonuses and moving up the chain.” Those middle managers are now on the chopping block, and founders are standing by to take the load.

Elon Musk’s brutal crackdown at X has given founders, in a way, permission to be tough on employees. To founders whose own companies grew too quickly during the tech boom, Musk offers hope that it might be possible to reduce the bloat and raise the bar for remaining employees as recession fears percolate.

Critically, for female founders, attracting dislike can feel like a career-ending move. In interviews, several founders pointed to the myriad articles over the years that seemed crafted to “take down” female leaders, illustrating the perils of embracing founder mode for women. Sara Mauskopf, the head of Winnie, a startup that assists parents in finding childcare, shared that she refrains from giving harsh feedback on Slack, wary that an employee might leak a screenshot to the media.

Musk has his share of negative press, Mauskopf noted. But unlike female founders, he and Neumann, the WeWork founder, enjoy the luxury of being given second chances by investors. It’s almost seen as a badge of honor to stumble and keep going. The media spotlight shifts away from male founders. “With female founders,” Mauskopf said, “it usually ends with the press cycle. That’s it for them. They’re never heard from again.”

Outdoor Voices founder Ty Haney is now fighting this fate. The one-time queen of athleisure — who was booted from her startup after a dustup with her board and a spate of negative press — has a new startup, Try Your Best or TYB, that helps brands build loyalty programs on the blockchain. It’s raised over $10 million in funding to date, TechCrunch reported.

Haney applauded Graham’s essay in a series of tweets, saying her “number one regret is being too impressionable and allowing myself to believe others knew best.”

She added, “Being ok with not always being liked or understood is part of the job and I wasn’t always comfortable with this. Particularly tricky, I think, for female CEOs, but the more successes we have collectively, the more proof points, the more normal it will become.”