The Hero’s Journey for Founder CEOs
Over the last few months I’ve been fascinated about the ontological status of LLMs. Clearly, they’re a more sophisticated form of “intelligence” than what’s present in a typical air conditioning control system. Yet they’re clearly not “people”. So what are they?
What is the relevance and importance of our embodiment to our intelligence? There seems to be a lot of diverging opinions. Frankly, after examining each opinion I’m left with more questions than I have answers.
I’ve been wondering if there’s a more systematic way of exploring the similarities and differences between the intelligence present LLM-based systems and human beings. Amusingly, I realized that a very “grounded” form of comparison might be the participation of human beings in free markets.
In this post, I’ll articulate a connection between the internal dynamics of a founder CEO’s personal growth and the internal dynamics of their relevant companies. To essay means to try. And I’m definitely fumbling my way through all this. But anyway, once such an articulation exists in subsequent posts I’ll try to explore:
Swapping out the human with an AI. We’ll therefore be able to explore the similarities and differences between humans and AI-based systems.
The implications for how people could be organized in a world with rapidly improving AI.
By writing “in the open”, I hope to get feedback and comments in real time as my argument develops. Once I feel like I have a good handle on everything (e.g. I’ve stress-tested these ideas with many folks), I’ll create a much more formal artifact.
Backdrop
Many founders have anecdotally reported to me that their company’s success has been gated by their own personal growth. In my own life, I’ve been deeply curious about the nature of personal growth and framing it in terms of naturalism. I’ve also been studying more about business strategy. For example, Michael Porter’s work on differentiation and competitive advantage. Putting these ideas together have yielded a framing which provides a deep continuity between the dynamics that take place within the founder and the dynamics reflected within the companies they’ve founded and led. It accounts for a number of disparate phenomena that multiple founders have anecdotally reported to me. For example, they start to identify with the company itself, take on the perspective of the company and that it starts to appear as a “living thing” to them.
This post lays out a high-level map for this connection between founder and their company. It starts with the highest level of abstraction by considering adaptivity at the level of a company, and then subsequently connects it at the level of the individual.
Competitive Advantage
There’s tons of really great books on the nature of corporate strategy. I’ve found myself finding a lot of resonance with Michael Porter and Hamilton Helmer’s work. Understanding Michael Porter by Joan Magretta has been my introduction to Porter’s work, and I’d highly recommend it! I’ve yet to read Hamilton Helmer’s book, but I’ve voraciously consumed his podcast interviews and articles online.
Porter focuses on the question all CEOs should care about - why are some companies consistently profitable while others aren’t? Everyone knows the equation Profit = Price - Cost. But I love the way that Porter systematically and from first principles decomposes the various forces that influence this equation.
In his view, a strategy informs a specific position that a company chooses to occupy in the market, downstream of some specific set of value-generating activities. A company’s strategy is normative. That is, it provides clear trade-offs for what the company should or shouldn’t do. He points out that there are companies within a market that achieve profits comparable to the market average, and companies that seem to consistently beat the market average. In his view, the mechanism by which companies gain this competitive advantage is via the process of differentiation. Specifically, by engaging in different chains of activities (i.e value chain) that ultimately provide value for the buyer. Or as he puts it, seeking to win by being different, rather than being “the best”.
Helmer echoes this point, but seems more focused on the underlying categories of differentiation that companies engage in. For example, he focuses on the seven “powers” that companies wield which allow them to sustainably engage in radically different activities.
It’s also worth pointing out that implicit in a company having a repeatable “value chain” is that they’ve actually integrated with a broader value chain external to themselves. So there’s a pattern of not just differentiation, but also integration. As a result, the system as a whole increases in complexity.
What Drives A Company’s Differentiation?
Porter and Helmer’s work has been invaluable in understanding business strategy (to the extent that I actually do!). But their work seems more descriptive than prescriptive. That is, I wasn’t sure what specific activities individuals in these companies engage in to figure out how to differentiate. Most explanations I received for this process articulated it as an ineffable process of “creativity”. Some mentioned that it can’t be taught. Others mentioned that it can, but only in limited ways.
It might well be the case that it can’t be taught, much in the way that the process of attaining insight can’t be taught. But insight can be proactively cultivated over time. That’s something I’m quite confident of. I’ve spent half a decade exploring practices for the proactive cultivation of insight, and they’ve radically transformed my life. I suspect there’s a connection between the two.
We can explore this connection via a thought experiment. Let’s consider the “minimal” case of a founder CEO of a single-person company. Suppose that their company succeeds in differentiation and achieves integration with the broader market. That is, the company is alive, humming and making money!
Where could the inspiration for differentiation have come from? By process of elimination, it has to be the founder. The founder then iterates upon this pattern until they manage to grow it into what Porter articulates as a sustainable competitive advantage.
As the company grows, this pattern of differentiation needs to be maintained and evolved. The founder’s role shifts from being the sole source of differentiation to creating an environment where the entire organization can participate in this new way of being in the world. We can pull in ideas from the enactive approach to cognition to articulate this process more formally. Mind in Life by Evan Thompson is an excellent textbook that covers these ideas.
The enactive approach to cognition represents an individual as a dynamical system that’s self-organizing and seeks to preserve itself (i.e. it’s autonomous in the more general case or autopoietic for unicellular organisms). When a founder CEO hires more people into their organization, they instantiate a social autonomous system that they co-create their world with. Each individual brings with them their own embodiment. But by participating in reciprocally constraining this social structure, they begin to identify with it and change their participation in the world.
An autonomous system in the enactive approach must have a few vital markers that are most relevant for this post:
It is able to create and maintain its own boundary with the environment, representing a clear “inside” and “outside”.
There is a circular chain of causation between its internal processes and the disposition of the boundary. That is, the disposition of the boundary at any moment in time is a function of the internal state of the system, and the disposition of the internal state of the system at any moment in time is a function of the state of the boundary.
The internal processes of the system form a closed graph of dependencies that are dynamically coupled with each other. That isn’t to say that the system doesn’t interact with the external world. But they always do so through the boundary.
This isn’t an academic paper, so I’ll just put it to you that modern companies satisfy this criteria. They have a clear boundary that demarcates an inside and an outside. They have clear norms that govern and maintain their behaviour, with the base norm of keeping themselves “alive”. For typical for-profit companies, this means not running out of money. Moreover, the processes inside an organization evolve in a circular causation.
There’s a lot more that can be said about this connection to enactivism in future posts. I have some really rough streams of consciousness here. For now this language can be used to describe the unique role that the founder CEO has within an organization. They sit on the boundary of the organization itself. They have a stereoscopic vision that affords them insight into the activities both inside and outside the organization. Moreover, because they sit at the boundary, they simultaneously engage in circular causation with both the organization and its environment. This provides them a unique vantage point from which to:
See opportunities that others might miss.
Frame market dynamics in novel ways that best serves the continued evolution and complexification of the social autonomous system that is the company.
Wield their credibility as a founder to metabolize these insights and turn them into concrete changes in strategy, and therefore the organization of people, etc.
The founder CEO is the source of the original insight that informs the initial positioning and strategy of the company (in the Michael Porter sense of those words). But this insight isn’t something that can be arrived at propositionally. It’s something that the founder is a participant in. This overall process is similar to the transmission of mystical experiences that I explored in this post. The embodied and ineffable nature of the original insight means that it can’t be articulated in a neat set of propositions. However, it’s necessary for the founder to attempt this to more effectively shepherd the pattern of interactions inside the company. So the founder locks themselves within a chain of reciprocal opening both within the company and externally to the company.
The Hero’s Journey
We have a very high-level account of how the internal activities of a company (and its founder) lead to the company’s differentiation. But what causes the founder to achieve such an insight in the first place?
My best answer for now - the founder embarks on The Hero’s Journey (i.e. the monomyth) as laid out by Joseph Campbell in The Hero With A Thousand Faces. There’s a lot of pop-culture references to what the hero’s journey is. I’ve found that they’re mostly quite superficial and misunderstood. But once I started studying the monomyth I realized why. I found it to be an incredibly profound idea! It isn’t merely a cool literary device upon which Star Wars was written. It seems to reflect a deeply true pattern in the nature of personal development, and perhaps reality itself. Campbell’s book is far too rich to effectively summarize here. I’m not audacious enough to try. If books are not your thing, I’d recommend a documentary made about this material called The Power of Myth.
The process involves a “hero” voluntarily answering the call to adventure, and to leave the comforts of their tribe. They experience trials that facilitate their growth, overcome some final metaphorical dragon that guards some ultimate treasure which they eventually bring back to their tribe. The journey grows and complexifies them as an individual, to set them up for their next journey. Moreover, it helps to revitalize their original culture with their hard won gifts. The Buddha was a hero that left his palace of comfort to follow the call to adventure. He gazed deeply into the depths of reality, and brought back his gifts of insight. The book argues that every famously remembered sage in history has played a similar role.
Similarly, the founder embarks on a hero’s journey to differentiate from consensus thinking in some way. They struggle and iterate within that process of discovering differentiated activities that nevertheless integrate value back to the whole. At least initially, the founder acts as the bridge connecting the internal reality of the company with the external reality of the environment. They gain insight from both inside and outside their company and metabolize it within their bodies. They then communicate this insight to the rest of the company in a way that’s legible to them. This shared participation with the insight allows a broader dynamical system to form around it. Once the founder’s role is framed in this way, there are many business books that seem consistent with it. For example, Peter Drucker’s The Effective Executive mentions that an effective executive seeks to cultivate the sort of stereoscopic vision that we’ve articulated here.
So what does it take to actually follow the hero’s journey? My favourite paragraph from Campbell’s book points the way:
The agony of breaking through personal limitations is the agony of spiritual growth. Art, literature, myth and cult, philosophy, and ascetic disciplines are instruments to help the individual past his limiting horizons into spheres of ever-expanding realization. As he crosses threshold after threshold, conquering dragon after dragon, the stature of the divinity that he summons to his highest wish increases, until it subsumes the cosmos. Finally, the mind breaks the bounding sphere of the cosmos to a realization transcending all experiences of form - all symbolizations, all divinities: a realization of the ineluctable void.
Many thinkers have noted that religions are essentially millenia-long conversations, arguments and debates on what it means to live a good life. Campbell points out that the hero’s journey is their shared consensus.
One must “follow your bliss”, as Joseph Campbell put it. He’d argue that within all of us, there’s a soft still voice that beckons us towards adventure, novelty, curiosity, and breaking past our limiting beliefs. Or to put it another way, the acceptance of adventure, leaning into the mystery, and mutual disclosure with one’s reality is the pathway towards differentiation and personal transformation. As he puts it, “If you can see your whole life’s path laid out then it’s not your life’s path.”
The process of discovering differentiated value-creating activities affords personal transformation within the founder. But it also necessarily changes the dynamics of the environment. The two two spin in circular causation facilitating the reciprocal opening of each other. As a consequence, it enlivens the individual’s culture and sufficiently complexifies the culture to form a stable niche for the individual.
Capitalism
Capitalism is by no means perfect. Especially the way it’s instantiated in the US. Specifically, in the US, it’s easy to point out its many flaws.
However, it seems to have a functional aspect that’s worth calling out within the ideas discussed in this essay. It seems that a system of free markets allows people to organize and exchange value in ways that more closely matches the underlying biological processes that take place within an individual. That is, an individual’s journey of complexification. I suspect that it allows the bottom-up differentiation at the level of the individual to more readily integrate with the top-down consensus and norms of society as a whole.
I suspect that centrally planned markets err too much towards the direction of top-down processing at the cost of bottom-up error correction. Libertarian anarchy likely errs too much towards the direction of bottom-up processing at the cost of top-down error correction. I suspect that both are much more workable at smaller scales, but don’t scale as the number of individuals nested within a culture substantially increases.
Again, this isn’t an academic post so I don’t have hard citations/data/etc for you here. That will be an endeavor for future posts.
Future Work
The connection explored in this post leads me to a number of questions:
What does it mean to swap out a human with an LLM-based system with the framing presented in this post? What would the overall design of such a system look like, and what would be its path for “continuous improvement”?
If we apply the enactive approach to companies, are there better ways of organizing people and thinking about company cultures? Especially the evolution of these cultures as the overall needs of businesses change over time?
What are the implications of this connection with the broader economic trends taking place specifically for software engineering? For example, the rapidly decreasing cost of LLM inference.
What implications does this have for how human beings can continue to provide differentiated value in the overall labor market? For example, does this overall connection have anything to add to posts like this one?
Acknowledgements
Thank you to Ryan Barton for his many thoughtful comments!
Also, the product sense reading group that’s been reading Understanding Michael Porter with me!