In today's startup environment, this one question has plagued countless founders: as their company grows, should they stay on as CEO or hire a professional executive to handle the challenges of a growing company?
When difficult leadership questions like these arise, entrepreneurs often look to their successful predecessors for guidance. However, in this case, success stories exist to support both models. Legendary figures like Steve Jobs, Jeff Bezos and Larry Ellison stand out as founders who were able to lead their business through the scale-up process as effective CEOs, while companies like Google, Twitter and eBay all leveraged the experience of professional CEOs to seize—and retain—dominance in their markets.
This lack of consensus has left room for discussion surrounding the topic. Perhaps no one has been able to sum up the difficulty of the question with quite as much focus and elegance as Reid Hoffman, a co-founder of LinkedIn who has twice stepped down as CEO to hand the reigns to a professional executive.
In "If, Why, and How Founders Should Hire a 'Professional' CEO," Hoffman explains that as a company becomes more successful, the responsibilities of being the CEO begin to mount up, eventually eclipsing "the things most founders love […] solving interesting problems, developing new technologies, devising a unique strategy."
An immensely difficult choice to make, Hoffman decided this was reason enough to relinquish his position on the c-level staff to focus more on his vision for the product. This ended up paying off for Hoffman, whose eventual partnership with Jeff Weiner gave the company the logistics expert it needed to reach the next tier of growth.
While he acknowledges that the decision won't be easy, Hoffman encourages founders to entertain the idea of hiring a professional CEO. Of course, when they do so, founders will want to take care to find the perfect person to continue the vision for their product. To guide them, Hoffman offers founders these three characteristics to choose the ideal successor:
- Visionary: Although they are brought in to take charge of organizational challenges, ideal startup CEOs will share the founders' passion for the long-term vision of the product. This, Hoffman says, is what separates the successor CEO from the COO.
- Accountable: While founders should look for an executive who will shares their vision, they should be sure that person will not simply defer to the founder. The CEO needs to be willing to proactively take ownership of company operations, what Hoffman calls "owning the ball."
- Founding spirit: Hoffman describes the hiring of a successor CEO another "founding moment" for the company. In this spirit, the CEO should embody all the knowledge, moral authority and commitment of a founder so that his or her role can serve more as a co-founder than an outside consultant.
It can be hard work finding someone who both embodies the above traits and has experience leading large organizations through rapid growth, especially while carrying the responsibilities of both a founder and a member of the c-suite.
Working with executive recruiting firms can help startups identify these candidates, no matter where in the world they are working and whether or not they are actively looking for a job. Finding people is easy, everyone has 'a network,' but finding the RIGHT people (or in this case the RIGHT CEO) is a completely different ballgame. YES Partners has helped to search, find and place countless such professionals in successful positions — see them here!
Finding people is easy, but finding the RIGHT people is not. YES Partners helps companies FIND the right people – for all company functions, across many industries and globally.