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Keith Rabois Says PayPal Was the Original 'Founder Mode' Company

By Keith Rabois · Leadership · 2 min read

At PayPal, they never promoted anyone based on management skill. They promoted everyone based on their craft. If you wanted to run design, you had to be the best designer. That's founder mode.

Key Points

At PayPal they promoted based on craft, not management skill — the best designer ran design
Brian Chesky reinvented and repopularized ideas that are actually pretty old school
Apple's model: you get promoted by mastering something, not by being a generalist

We never promoted anybody based on their management skill. We promoted everybody based upon their craft.

Promote by Craft, Not Management

Rabois: At PayPal, we never promoted anybody based upon their management skill. We promoted everybody based upon their craft. If you wanted to run the design team, you had to be the best designer. Engineering team — the best engineer. Product — the best product person. CFO was the best finance person.

Maybe that's why PayPal thrived. Maybe that's why my friends and colleagues went on to do very interesting things — they brought those tenets with them.

We never promoted based on management skill. You had to be the best at the craft.

Brian Reinvented Old Ideas

Rabois: Brian Chesky reinvented and repopularized ideas that are pretty old school, actually. Founder mode is the antithesis of hiring a general manager — someone whose expertise is at managing versus someone whose expertise is actually at building.

When you hire for founder mode, you're looking for different people. Different traits, different skills. Elon has always been in founder mode.

Founder mode is the antithesis of hiring a general manager. You hire builders, not managers.

Apple's Model

Rabois: Apple has basically been in founder mode through most of its history. At Apple, you get promoted by mastering something, not by being a generalist. People have done the same thing for 15 years — they are the world-class expert at that one thing.

Apple collects a bunch of people who are literally the best in the world at 26 different things and mixes them together. That's a much better model.

Apple collects people who are the best in the world at 26 different things and mixes them together.

Promote the Best Salesperson

Rabois: Sometimes the most talented IC doesn't become the best leader. I actually think they should be able to — sometimes it's mentoring, pairing them with the right person.

If you promote the best salesperson, you're not going to demoralize your team — everybody knows they were the best. You bring in someone who's never hit a quota, never proven they can sell your product, and everyone's like — who the hell are you? That's a very valid critique.

Promote the best salesperson and the team looks up to them. Bring in an outsider — everyone says who the hell are you?