The 3 Advantages You Have As A Founding CEO

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“Do you think I would be better off stepping down as CEO?” “Wayne”, a CEO I’m working with, said to me. “My investors are offering to make me Executive Chairman or CTO. Maybe I should take the offer?”

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“I think it’s a huge mistake for you to step down,” I said. “I know there are a lot of problems the company has, and I know you’ve got to get better as CEO, but I think if you step down, the company will fail.”

“Why do feel that way?” Wayne asked me.

Founding CEO advantage number one: You’re not going to find someone better than you to run your startup, especially if you’re an early stage startup.


“Who are they (your investors) going to find that’s better than you?” I asked. “Seriously, your revenue isn’t even $1 million per year. There’s no way an experienced CEO is going to be interested in joining you.”

“Did you take a look at the candidates?” Wayne asked me.

“Yeah, I did,” I said. “There’s no one with a great resume. It seems to me that they’re gonna just try and sell the company if you step down.

“Is that what you want?”

“No, I think I can make the company successful,” Wayne said.

“Great!” I said. “Are you ready to fight for it?”

“I am,” Wayne said.


Founding CEO advantage number two: You’re going to be the best salesperson the company ever has.


“Great. Let me remind you that since you started getting actively involved in sales and closing every deal, that sales have exploded,” I said. “And that’s not a coincidence.

“I’ve seen this over and over again working with founding CEO. You’re (the founding CEO) always the best salesperson the company has because you understand the product and the company in a way that a professional CEO never can.

“That’s huge!”

“Yeah, we’re going to exceed our number for the quarter,” Wayne said.

“I know,” I said.


Founding CEO advantage number three: You will understand what your company is trying to accomplish better than anyone else.


“I’m still worried they’re going to replace me,” Wayne said.

“I know, but they would have replaced you already if they could have. Do you want to know what your biggest asset is?” I asked Wayne.

“Yes, I do.” Wayne replied.

“If they (your investors) fire you, they lose all the nuanced knowledge you have about the company. And losing that knowledge can be the death knell for a company.

“My wife worked at a company ten years ago that was doing really well. The board decided to fire the founding CEO. The company went down the tubes.”

Wayne was nodding his head up and down.

“That’s why your investors are wary of replacing you. That knowledge you have can’t be replaced,” I said. “They may be frustrated with you, but they’ll hang in with you because most investors today realize just how risky firing the founding CEO can be.”


Summary: Execute your plan and you will not be fired.


“Let me sum up what you need to do,” I said. “First, you need to meet your numbers and keep growing revenue. Second, you need to keep adding to the team. Third, you need to be able to close the next round of funding.

“If you do these three things, you’ll be fine.”


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