As 2015 draws to a close, we thought we’d offer you another round of lessons from the Founder’s Mentality 100 (FM100). The FM100 is Bain’s initiative to assemble some of the top insurgents in the world into a single forum to co-create solutions to what we call the growth paradox: Growth creates complexity, and complexity kills growth.

Last year, we examined what the lessons from the FM100 meant for incumbent companies (you can read part one and part two here). This year, we focus on further defining the elements of Founder’s Mentality and illustrate them with examples from the FM100.

We define companies with high Founder’s Mentality as those with an extraordinary sense of insurgency, a frontline obsession and an owner mindset. Within those three overarching elements are nine sub-elements (see Figure 1), and it is within those elements that the richness of the Founder’s Mentality truly comes to life.

Figure 1

The most sustainably profitable companies nurture and maintain three traits

Insurgency typically comprises three elements:

1. The team is at war against their industry on behalf of underserved customers. This means every employee understands the company’s bold mission, and can answer the big “why?”—“Why does the company exist?”
2. The leadership team embraces “spiky” capabilities—being world class at those things that really matter for customers and decidedly average at the rest.
3. The leaders have a limitless horizon, refusing to be defined by or constrained within the industry in which they first competed.

Learn more

About the Founder's Mentality

The three elements of the Founder's Mentality help companies sustain performance while avoiding the inevitable crises of growth.

Let’s take a look at the first of these insurgent traits: bold mission.

Almost all great companies start as insurgents, with a bold mission to redefine their industry on behalf of underserved, or new and emerging, customers. This sense of bold mission gives employees answers to all the key “why” questions—“Why do we exist?,” “Why should I work here?” and “Why does this company deserve my discretionary energy?” Our blogs are filled with examples of insurgent missions at companies like Discovery, Nando’s, Yonghui, D’Decor and Jaipur Rugs.

But let’s focus on the example of CavinKare, a FM100 member from India that became a radical rule breaker in consumer goods by inventing the concept of using low-cost, single-use “shampoo sachets” to give the poorest Indian consumer access to shampoos. Its success redefined consumer marketing in India.

Here’s CavinKare’s chairman and managing director CK Ranganathan:

“We had a very clear mission that defined who we were—‘Whatever a rich man enjoys, the common man should be able to afford.’ This was extraordinarily aspirational for our team. The sachet was the first real innovation that allowed us to do this and drove our growth. And, of course, that led us to have shampoos strategies and hair-care strategies and think about price ladders and classic ways to compete in the space. But that wasn’t who we were—we had to learn the game and skills of fast-moving consumer goods companies, but we didn’t have to play by their rules or even always play their game. In fact, over the years, returning to this original insurgent mission has led to new innovations across categories. We are introducing radically new packaging for juices that allows for ambient temperature storage and new price points. This is a completely different category and a radically new packaging solution, but it is part of the mission.”

Too often, companies lose their insurgent mission as they grow.  Does this matter? Yes, a strong insurgent mission keeps you externally focused—forcing you to check how well you are keeping your promises to customers, and how well you continue to innovate and disrupt on their behalf.  A strong insurgent mission helps you capture the discretionary energy of your people—the energy they choose to give your company, because they believe in its nobler purpose. And a strong insurgent mission demands a much higher ambition for the leadership team. It is not enough to meet financial targets–you must continue to redefine markets on behalf of under-served customers. You must continue the revolution instead of retreating behind your walls to protect your competitive position at the expense of your customers and employees. CavinKare’s mission is to fight for the common man and woman, ensuring through radical innovations in packaging that it can deliver to all people the luxuries previously enjoyed by the rich alone. Is your mission as clear and as motivating?