When Founders No Longer Need to be the CEO
Today Voray announced that we have promoted our COO to CEO.
Since I was the CEO, that may come as a shock to some people (um….probably the investors most of all).
Yes, that’s right. I have promoted someone into my job and moved on from the CEO position to a new “Chief Community Officer” role (with of course, the fancy “co-founder” designation in the title).
I know, I know. Market moving announcement. Will the Dow hold up? Who knows.
Even though this transition has been going on for a while, and my mom is the only person who reads my posts, writing this article because it’s opened up the door for a quick discussion on “the Founder role”.
Especially since I’ve been getting questions like:
wtf is a Chief Community Officer?
did you get fired?
don’t you want to be the CEO, you are the founder?
what are you going to do now?
The founder role
First, let’s revisit my view of the role of Founder for most any business (yes, this is becoming close to a mantra). Good founders:
Never run out of capital
These are the table stakes.
Sure, early on, you set long term and short term strategy and underlying goals. So the teams know what the business is driving towards.
Yes, you are involved, early on, in product decisions based on user discovery that steers towards achievement of those goals while motivating the correct sales peeps to generate a return (without destroying culture).
But those 4 things above, that’s what founders do at the core, early. That’s your role Founder.
When should founder’s no longer be the CEO?
There’s lots of answers to this question. I don’t know the right one.
Sometimes founders hang on for dear life, even when they are not doing a great job and cannot scale with the business. It’s makes it harder for everyone.
There’s lots of reasons this happens (ego, lack of self awareness, emotion, delusions of grandeur — VCs with no real control, lol).
No matter what, for the best of the business, in a perfect world, it should be up to the founders when this decision is made and it should be pragmatic, strategic, and thoughtful for all involved.
That said, I tend to believe a founder should move on from CEO role when they are doing themselves and the business a financial disservice by continuing to be in it. Here’s when this happens:
They are fully vested
They are the largest single shareholder (so getting more equity will not be too impactful)
They are doing themselves and their family a disservice by continuing to work there vs building equity value in something else
The business will be fine (if not better off) with someone else in the role
They can generate more value for the business in a different role for the business
Why move on from the CEO role at Voray?
It’s the right time for me. And for the business.
It’s been four years and the business is scaling.
I’m leaving the CEO role when the business is well capitalized and the company is scaling quickly.
We did it! We scaled events!
(dear VC: told you so!)
Like most startups, creating this business was a gigantic hustle. When it was just me in 2015, I threw countless events in just a few months to learn if there were specific steps to put on a highly curated (non spammy) event that people wanted to attend.
As an advocated for professionals, we wanted to create a more valuable professional social graph. Where people actually meet in person. Solve their professional challenges and build authentic relationships together.
(I know, I know, holy shit — so unique. I still can’t believe this is innovative in 2019).
Events? That’s not scalable. What a lifestyle business.
(VCs always call things Lifestyle businesses if they can’t see the scale. It reminds me of this 2010 article in Inc Magazine where a bunch of VCs called ShopKeep a lifestyle business. One of these firms did our Series B eventually and became one of our largest and most supportive investors btw.)
Anyway, I was “pointing at the moon while everyone was staring at my finger”
(as Confucius and Jeff Fiala says)
I threw 100 dinners in the first many months.
I did this with a 2 year old and a new born.
(yes, I am still married)
We learned events are scalable!
There are repeatable and, by virtue of that, scalable (automate-able) steps to put on an event (about 97).
Then we went on automating it!
Now…..it’s pretty much automated.
We can do 100s of events a month with very few people. We just had our single largest revenue month ever. The business has a ton of cash and growing rapidly.
So why leave now?
I like to hustle and chase goals. You put a carrot in front of me, I’m going to chew my arm off before I don’t eat that carrot. I’m going to do it with emotion and passion. I love building things from the earliest stages and from a kernel of an idea. Like Steve Blank says, startups are a search and take a lot of hustle and user discovery — I love that part.
I’ve seen this movie many times. $150m+ of venture later, countless boards, advisory roles, investments, and being on the “investing buy side”, I have more to give Voray (and the technology industry) than day to day operations of Voray.
Jeff Fiala architected most of the Company’s more recent scale and processes from the data and learnings we generated. I believe with great conviction that he will be better at running the business day to day than I will going forward - I am not ashamed to say this and am proud of what we built and am excited to learn from him and watch him scale the business (which I know he will).
I will be more impactful to the business by being an advocate for professionals and customers in our network. I want to help founders, investors, and professionals solve their problems — I can get them what they need to be successful. I will still be on the board. I am still the founder fulfilling the founder role. But I want to lead community and be an advocate for my network.
I am doing my family and the business a financial disservice by continuing to be the CEO versus taking on a new role at the business and taking advantage of other opportunities for it (and for myself)
So that’s what going on at Voray.
We have a new capable CEO who’s the single best person to continue scaling the business, a passionate founder who will help him and the business at every step of the way, a terrific board and investor base who are excited about the business, and the business is well capitalized, growing quickly, and scaling nicely.
Most of all, I have the ability to continue doing what I do best and enjoy the most: building Voray and being an advocate for the tech community.
As for what’s next? I dunno. In addition to my Voray role, I will probably try my hand at venture in some way while continuing to invest and advise early stage companies.