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As startups mature, I've seen many a transition from Founder to CEO, as new leadership is needed.

What's the diff? Founders often focus on 'Build' and CEOs often focus on "Grow".

They're two different strategies, two different mindsets, and often two different personalities. You need them both.

How would you characterize the changing of the guard as high growth startups shift to maturing businesses?
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Marija Renić's profile photoYat Siu's profile photoDeep Patel's profile photoFiras Raouf's profile photo
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CEO's tend to build systems and processes -- they focus more on sustainability. Founders often trust a small team that have been with them through thick and thin. CEO's look more for the best player available.
 
+Brad Farris good observations, I agree that founders mentality is often of market disruption and hunting for new opportunities. I agree, CEOs often focus on sustained growth.

However in both cases, I see leaders bringing their trusted prior team with them, their network. I've seen this a number of teams emerging in the same location(s) over and over.
Yat Siu
 
I'm not sure I agree that Founders are always Builders. Strong CEO's are Builders, IMO growing is an aspect of building. Founders are, in my personal observation, more innovators and to some extent opportunists/specialists. I suppose it also depends on how to define "Build", do you mean building a company or building a product? Both are build but have entirely different meaning/skill sets. I see a lot of founders building product, not too many building a company and need help with that. Those who can do both are the special ones IMO.
 
+Yat Siu (so everyone has reference is a successful business leader in Hong Kong that exhibits both traits)

Great to hear your perspective. I agree with your definition around a strong focus on innovation (which I often see causes disruption) and thereby builds something new.

In some cases, I see the founder often staying on, but now with the support of a CEO/President/Chairmen is able to re-focus on building product rather that managing the company. Your thoughts?
 
Had a similar discussion a few days ago with a couple of entrepreneurs and this was the topic. I am strongly pro Founder to CEO shift in the company leadership/mindset after the initial Build is achieved: Founder has achieved the first accumulation of capital/people/know-how and now it is time for a CEO to nourish it.
Kind of like with a country - good founding father is a general but a good president is a politician. If you know what I mean.
Yat Siu
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Thanks for the Kudos Jeremiah, long way to go still IMO!

Must has been said about elder statesman guidance and it should most certainly be valued. The value that a for-hire CEO can bring is experience in scaling a business and growing a business that was tens of people to hundreds if not thousands of staff is critical because most founders will never have had the experience.

However what's ultimately more important isn't the Title but the chemistry with whoever is brought in to bring the support. Guidance can be delivered in the form of a very capable COO with a CEO/Founder still heavily focused on product. There are plenty examples that show success (and failure) either way.

To make it work I think the change must come from understanding the root of a companies culture. For example; is it around the product(s)/idea? or is it built around the Founder? That will more likely determine the kind of management assistance the company will have most success with. Companies who tend to struggle with identifying that understanding of themselves are typically the ones who have rotating CEO's in their more formative years, at least in my observation.

A company that still has the roots and culture of the company firmly around its Founder(s) will struggle greatly when those Founders are abruptly departed because they represent its roots/foundation. Personally I am of the view that the transition to "for-hire" CEO led organization should come first when the company more strongly identifies itself with the product(s) than with the founders which typically means that the business is more mature, has revenues and a clear business path. When it's still "pivoting" around to find its true meaning I think it's roots are with the Founders and should avoid hiring a CEO that isn't product focused and create unnecessary friction due to questions of leadership and direction.
 
I agree there is an evolution from a founder CEO (tactical, hands-on, getting stuff done) to a professional manager CEO (focusing on board, vision / strategy, building senior team and guiding the senior team to execution). The top priorities for an expansion stage software company are

A clear vision of your company’s target market, the pain point your solution addresses within it, and the complete delivery of your solution to the customer.

Building a cohesive senior team that is qualified to propel the company to the next stage of growth…a team that is highly focused on execution, highly accountable, and performance-to-goals driven.
Ensuring that the company resources and funding are sufficient to reach the next stage of growth

I have written more about this topic in these posts:
Building Your First Senior Management Team http://blog.openviewpartners.com/building-your-first-senior-management-team/

What’s a Founder’s Life Expectancy as CEO? http://blog.openviewpartners.com/founding-ceo-life-expectancy-as-ceo-that-is/
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