The discussion of role dilemmas in The Founder’s Dilemmas brought up something I had not really considered before this class: creating the company and being the best person to run the company are two different things. Those roles probably overlap a lot at the beginning. Someone has to make decisions, find customers, manage the money, solve problems, and keep everything moving. The founder is usually doing most of that because there is nobody else. But what happens when there are 50 employees instead of five?
Research on startups has looked at situations where founding CEOs are eventually replaced by professional managers with more experience taking companies through later stages of growth. That sounds harsh when you first think about it. It is still the founder’s company. Why should someone else run it? The more I thought about it, though, the more I understood the argument.
The skills required to create something are not necessarily the same skills required to manage a large organization. Someone can be incredible at developing a product or spotting an opportunity and not be particularly good at managing employees, building processes, dealing with investors, or leading a much larger company. For the Mindful Money project, I have myself listed as Founder and CEO. At startup, I think that makes sense. My background would also let me cover several finance and strategy responsibilities without immediately hiring additional people.
What I do not think makes sense is saying that because I founded it, I should automatically remain the best CEO forever. That would depend on how the business developed and whether I developed along with it. Maybe I would become a great CEO of a larger organization. Maybe my best contribution would eventually be in strategy, finance, or another role while someone else handled more of the day-to-day leadership. I obviously would not love coming to that conclusion after building the company, but ignoring it would not help either. The part that stuck with me is how much identity can get wrapped up in a title. If being “CEO” becomes more important than doing what is best for the company, the founder can end up creating the exact problem he or she is trying to solve.
References
Wasserman, N. (2013). The Founder’s Dilemmas. Princeton University Press.
Banerjee, P. M., & Cole, B. M. (2012). “A Study of Biotechnology Start-Ups Undergoing Leadership Change.” Technovation, 32(9–10), 568–578.