Over the past month, I’ve talked to four founders who are looking to hire CEOs to run their companies or who’ve already done it. Two are early-stage; two, later-stage and more mature. This isn’t abnormal. Lots of founders transition away from being the CEO for one reason or another in the company’s life cycle. Some founders even come back and reassume the role.
The early-stage founders’ thoughts around this really struck me. They described hiring a CEO as if they were hiring any other employee. I don’t think they fully understand how hard it is to find the right CEO for an early-stage company and set them up to succeed.
Hiring a CEO for a mature company makes lots of sense. Product–market fit has been achieved. The team is stable. Processes are established. There’s historical data to help inform future decisions. The machine is already built. It may need tuning, but it’s there and working.
Hiring a CEO for an early-stage company is a different story. The pieces to the machine are scattered all over the place, and the new CEO must figure out how to assemble it. It can be done, and it has been done, but it’s harder. Trying to find product–market fit can be challenging if you’re not passionate about the problem or don’t have deep experience in the space. CEOs are the glue holding small companies together, which is hard to do if you didn’t write the blueprint or understand how all the parts work together. There’s usually little historical data, so decision-making can be harder for a non-founder CEO. Most founder CEOs don’t leave in the early innings because everything is going well. Cleaning up someone else’s mistakes is a tight spot to be in.
If you’re an early-stage founder, be mindful of these and other variables if you try to replace yourself.