Most founders and investors in tech have their opinion on what traits are exemplary of top founders. For example, it could be their capacity to learn quickly, their tolerance for uncertainty and stress, or an inherent chip on their shoulders that provides the intrinsic motivation to build (and be) something of importance.
We have observed some patterns too.
After working with and screening numerous founders, we have identified some common data points on top-tier early-stage founders. But more importantly, we have also observed how some of those traits become shackles as their company evolves to a meaningful scale.
Our observations are empirical rather than being academic or theoretical. And, they have their implicit biases. For example, our observations are skewed towards early-stage tech founders in the US (and generally in the SF Bay Area) with pre-defined metrics for success, such as raising their next round of financing, hiring their core team, achieving meaningful traction, and pleasing customers. Furthermore, the traits we observed can exist within a solo-founder or across a tight co-founding team (typically two).
Nonetheless, we hope to further illuminate this topic because it will continue to be part of an evolving discussion as the world seeks, supports, and funds the founders who are catalyzing human development through innovation.
In this post, we will first summarize specifically what those common traits and threads are. We will cover a bit about historical patterns (e.g., upbringing, initial living conditions, etc.) and psychological patterns (i.e., how they ‘think’).
Second, we will discuss the invisible barriers of belonging and beliefs that inhibit their potential. For example, the ability to rise to ‘run through walls’ or ‘surmount challenges’ is unarguably an important one for any early-stage founder. However, if that ability is baked into that founder’s ability, “How do they know themselves if they don’t have a wall to run through?” It is no surprise, then, that when things in their business are going well, even momentarily, they might find themselves unnecessarily creating walls that don’t exist. They do so to maintain identity coherence.
By understanding these invisible barriers, we are empowered to chart a personal development & growth plan for founders as their companies grow and evolve.
I: Common Traits of Top Early-Stage Founders
Historical
Grew up in a socioeconomic structure that was limited on one of a few fronts: 1) A class system deprived them access to networks and financial resources to realize their potential, 2) The structure disincentivizes people from trying to change their situation, and 3) There was limited economic opportunity and hence limited contexts to practice and hone their talents. As such, they can develop an ability to be creatively resourceful to make the most out of whatever is.
Lived in an environment where attaining things required effort. They didn’t grow up in families that didn’t have to bat an eye to purchase them new clothes, sporting equipment, computers, or the like. When they were given new things by their parents or seniors, they knew those things weren’t easy to come by. This is not to say they had no money or resources. Rather, they were in a context where they were regularly reminded that those resources didn’t come with ease. However, because things could come through effort and merit, that gives them hope that things can get better through their own efforts and merits— this cause and effect function is critical to founder development.
Sufficiently emotionally enriched by birth parents or surrogate parents. This phrase sums it up best, “I knew we were materially poor, but I was never made to feel poor.” The keyword is ‘feel.’ And setting things up for a child to feel some emotional enrichment is no small undertaking. At times, emotional enrichment isn’t available through their blood parents. However, we have observed that the child receives a degree of emotional enrichment from a guardian, a surrogate parent, or a special human being that:
Validates the child's existence but not so much that the child doesn’t feel they have something to ‘prove’ — they need some deprivation here to be motivated to ‘plant a flag’ in life.
Encourages them to freely experiment, fail, and learn without feeling shameful or undeserving, and
Appreciates their being different or unique isn’t entirely a bad thing. As such, the child can sufficiently regulate themselves and provide some regulation (psychological safety) for others. They also have a strong enough platform to grow from. But more importantly, they still have perceived personal voids that they are driven to fill.
Their early and immediate belonging is often in question. As they grow up, they realize how different they are from other children, teenagers, and adults. It could be that they ‘wanted more’ out of life. Or, they value technology and intellect while everyone else might be obsessed with specific sports, music, and other activities. This reinforces their desire to think and look beyond their immediate context to another place that can be a proper ‘home’ to their authentic dreams and desires. It is no surprise that so many of these founders find their way to Silicon Valley and the USA.
Psychological
Sufficiently annoyed by things that don’t make logical sense and are compelled to do something about it. The human brain is a meaning-making machine and can’t stand not being able to stabilize associations between external events and things. Without this function, human beings don’t have the necessary rules of life to guide their internal decision making and hence external behaviors. Top founders have an interesting subset of this conniption. If something doesn’t make sense logically, as there must be a better, more efficient way for things to function, they will continue to ask questions and seek answers to get to the bottom of it. Eventually, their ability to capture and understand problems becomes a market opportunity. Eventually, they form an idea about how an aspect of the world and life should be, which provides a driving force for focused action.
Slightly socially awkward. When you meet them, you can discern this as they often ‘smile at the wrong thing’ because they can’t easily calibrate whether someone is joking or not. Studies on neurodiversity show that while their social skills may be inhibiting in some ways, they have a godlike capacity to process large volumes of data and draw relationships between them.
They are honest to themselves about themselves, and more importantly, honest about what is. The first is obvious; they have developed an understanding of their strengths, limitations, and what they need help with. The second is, while the world and life might not be the way they want it to be, they will take the present state of affairs as is and work with it. This skill also means they don’t necessarily see bad news as bad news— but information that will help illuminate the next steps they must take. Furthermore, they appreciate data, measurement, visibility, and candor because they aren’t afraid of difficult feedback. Jeff Bezos summarizes this best, “Complaining is not a strategy. You have to work with the world as you find it, not as you would have it be." As such, these founders won’t get caught in living in denial or illusions, but always curious about seeking the truth and what they learn from it.
Instinctively default to ‘fight mode’ when placed under duress. To clarify, when someone is in fight mode, that does not necessarily mean they are physically engaging in mortal combat with another person, being, or object— fight-based behaviors aren’t always visible. A more general definition for fight mode is “The instinctive response to increase activity— mental and physical— in an attempt to become the dominant controlling variable in the system.” When under great stress and uncertainty, founders will step up (run through walls, so to speak) to gather information, understand what they are dealing with, and find a way to gain control of their ecosystem again. Put simply, they fire up all cylinders.
A stronger bias for action than analysis. This does not mean they do not think, critique, and analyze. However, their instinct is to learn through ‘doing.’ Especially since what they build typically does not have perfect precedence to model. Therefore, they illuminate their next steps through action, learning, and iteration.
Can see the forest and the trees. These founders have the unique ability to see the high-level vision but zoom in and out as necessary— almost as effectively as double swiping on a touch screen. Mentally, that means they can chunk up and down as needed— focusing on daily activities and use their bigger vision as a guiding mechanism. More importantly, they can easily distinguish what a 'goal' is from the process used to reach the goal.
Optimistic about what can be achieved, pessimistic about how long good results will endure. These founders are typically optimists because they see what can be built, gained, included, and created— this is a mindset that focuses on ‘what can be.’ However, they are equally balanced and pessimistic about how enduring any results they create are, whether that be sales results, fundraising closes, negative churn, etc. Another part of their mind obsesses about what could go wrong and what is missing— now and in the future— and how they can be prepared for that.
Think in terms of criteria and create processes for others. However, don’t typically adhere to them. For example, a product-led founder can document and create a process they use to evaluate what customers need, deliver upon those needs, and prioritize which needs must be shipped first and how. However, they won’t always follow the process themselves in a disciplined manner— they will always change little things here and there to improve it. Think of them like car mechanics who find ways to ‘tune-up’ the vehicle. We elicit this trait using their language patterns.
Independent thinkers that optimize in a collaborative environment. While their intellect and ability to work independently are high, they truly shine in a more collaborative environment where they can elicit diverse input and thinking from others and set a course of richly informed actions by crowds' wisdom. However, they won’t simply accept opinions from other ‘experts,’ they will scrutinize the data and triage those opinions. When these founders talk about their work and their company, they often use 'We' more than 'I.'
They hate losing especially when they know they are capable of winning. They have a strong association between their performance and who they are. As such, they are somewhat identified with their results— this provides the necessary feedback and drive to perform as well as they can because performance feels great. Therefore, the lack of performance feels terrible, and they will do anything they can not to feel that way. All of this manifests as extreme self-accountability for their company’s performance rather than one of blame, shame, and excuses.
The behaviors above and traits are extremely useful in their respective contexts. Especially in early-stage company-building when they are building something unprecedented and confronted with great uncertainty. However, some of those traits have their ‘other side’ too— in the next section, we shall explore some of these ‘other sides.’ Doing so allows us to chart a personal development and growth plan for founders as their companies grow and evolve.
II: Invisible Barriers to Breakthroughs
As a company matures successfully, it attracts more money from investors to capture more market share and build defensibilities. However, what happens when a top founder suddenly finds herself/himself earning more money than anyone in their family ever has? Or, suddenly, that lesser-known founder is in the spotlight, seen as a public figure and role model to other aspiring founders? They are confronted with a slight identity-crisis that we have observed as mental disorientation, mild experiences of panic, and a general feeling of ‘surrealism’ about their life experiences. We have observed a few knee jerk reactions to this identity crisis:
First, they often resist being too ‘seen’ by the press, even though their company needs it for strategic reasons such as social signaling, attracting top talent, and securing great partnerships in the wider ecosystem. Recall also that these founders are often slightly socially awkward. Because they operate with strong meritocratic values, it isn’t obvious to them how important social signaling and status games are for others. As such, avoiding the spotlight also means loss opportunities on the PR front. It’s not that they don’t clearly communicate their value proposition; it’s that the public doesn’t receive the necessary signals to want to even properly learn more about them.
Second, they often feel ‘guilty’ for having more than anyone in their family has before, and feel somewhat obliged to give a part of their wealth away. If that guilt is not dealt with or processed, it corrupts their internal sense of deserving and worth, leading to feelings of fraud or ‘imposter syndrome.’ This fires up their critter neurology— flight, fight, fear responses— because again, their belonging continues to be in question...
As if the founder's journey isn’t lonely enough! When someone’s original belonging is in question, they feel isolated, alienated even. Even though they may have created a strong culture of belonging within their organization!
With their success growing, these founders can now afford to invest in things that would move the needle for them personally and the company. For example, they can move out of their studio and live in more rejuvenating accommodation. They can even purchase a much needed new laptop for themselves. They can afford to invest in more operational assistance, especially for things they shouldn’t do themselves. The question is— do they embrace these new privileges to grow the health and wealth of their operating ecosystem, or do they continue to deprive themselves because of feelings of guilt and undeserving?
Third, if things are going very well, can they resist the urge to artificially create a new challenge to entertain their sense of self? Of course, the startup environment provides an endless supply of mountains and challenges to overcome— however, how do these founders evaluate 1) Their instinctive response to fight for achievement, against 2) Their company’s need for them to fight at that moment?
Suddenly, the catalysts of their upbringing— those that gave them the drive to achieve great things in business— can become shackles to further growth, accomplishment, and, more importantly, fulfillment. Therefore, we find it imperative for top founders to have a ‘frame’ to re-evaluate the strengths that got them to where they are now, and the strengths they need to go where they want to go. Of course, not all founders continue in their businesses beyond a certain growth stage. However, we find the following questioning frame to be illuminating and transformative for the ones who do and are willing.
III: Illuminating the Barriers of Belonging
Bert Hellinger, a famous German psychotherapist, said, “In a family of thieves, the one who does not steal has a guilty conscience.” We can paraphrase that for founders, “In a family of the unambitious, the one who strives for more has a guilty conscience.” Bert touched on belonging uniquely and profoundly, illuminating the hidden rules we use to govern our decision-making in life— rules of belonging. Identify your rules of belonging using this set of questions:
What rules of belonging did you grow up with? (Note: the rules can be about belonging within your friendship circles, family, country, etc.).
What were the consequences of violating any one of those rules of belonging?
The rules of belonging— and their consequences— can come in many shapes and sizes. For example:
Never show you are successful — or others will go out of their way to cut you down.
Don’t complain — or you will be seen as weak and never acknowledged.
Don’t disagree with your elders — your parents will be discredited for the way they raised you.
Always do what you say you will do — or no one will ever trust anything you do or say again.
Never ask for help from strangers — or they will betray you, and you will lose all your precious possessions.
Every child with a loving heart will, in some way or another, make a heartfelt promise to their family and the people they come from, “I will be like you, I promise…” Though those children might not have the words to express that sentiment, they do so in their hearts. These promises become rules of belonging. The rules of belonging are contracts of devotion, “Because I love you… I will [insert rule of belonging].’’ It is important to recognize that these contracts are driven by the force of love, not fear. Furthermore, these contracts often operate beyond the founder’s conscious awareness since they were formed way before they even had the language to describe their experience. As such, they have no volition over their operations until they are brought to conscious awareness.
What does one do once they explicate these rules? First, it is very difficult to break or remove a devotional contract. Our observation is that when people discover their irrational fears, they are willing to let go of them simply because they seem so silly once brought to conscious attention. However, ask someone to give up their contract of love, and you may as well tell a mother to abandon their child or a spouse to leave their soul-partner!
Therefore, it is better to illuminate the founder’s past and their rules of belonging and respect that the past created a future foundation. Furthermore, the consequences of violating those past rules of belonging are unlikely to happen in their current context of building a company. For example, disagreeing with your elders for the sake of innovation is often celebrated and invited by high-performing cultures. And, if that elder is a strong, strategic board member, they are unlikely to discredit your parents just because you instigated healthy debate! Recognizing that old rules of belonging have outlived their use can loosen the hold it has on founders.
The second critical step— these founders must realize that success and well-being is not a zero-sum game. That is, their being well and thriving does not make other people’s lives miserable and negative. Growing their success doesn’t take away from others— even more so, they are founders who create new value in the market and new jobs for people! The corollary of that is that being miserable and keeping themselves limited doesn’t actually improve things for the people they came from either— starving yourself doesn’t take away someone else’s hunger, for example.
Conclusion
We believe that understanding a founder’s personal history is powerful. By appreciating the circumstances upon which a founder grew up, we can understand their motivational drivers and strengths. But more importantly, we can predict how those traits might become shackles over time, especially since all behavior can be advantageous in one context, yet limiting in another.
By closely studying the assumptions that underpin founder behavior and decision-making, we are empowered to chart a personal development & growth plan for founders as their companies grow and evolve. We can then determine the nature of the support— monetary, people, and information— they will need to optimize their efforts towards their goals.
Founders and their teams sit at an important nexus— they serve as a point of conversion between capital and enriched, happy, loyal customers. Specifically, top founder talent is a rare seed, one that, when nurtured with the right operating conditions, can produce incredibly equitable opportunities for human beings across the globe.