The hardest thing about taking over as CEO from your cofounder

Changing perceptions is the hardest part of taking over from your cofounder CEO. What people see affects how they act, and it can be hard to get them to see you as the CEO. There are several different groups of people you need to consider: your board and investors, your employees, and yourself.

You did your job well as the other cofounder. Your job was to excel at the technical parts of the work, whether that was engineering, marketing, or operations. You calibrated yourself carefully in meetings, on social media, and at conferences so you didn't contradict or outshine your cofounder CEO. You were so good at being second in command that, well, that's how people see you: as second in command.

And that's a problem now.

Your board and investors

Many startups fail when a founder CEO leaves, especially at the earliest stages. There's often no extra cash and little willingness to part with a big chunk of equity to hire an outside CEO. As cofounder, you may be the best choice as the next CEO, but also your board and investors may feel they have little other choice anyway. They've written you and the company off a bit in their heads, so what the heck, let's see what you can do.

Your investors aren't a unified front, either. I had one investor who was calling me "an unscalable CEO" and someone "without any of the skills of a CEO" during the transition. Funny thing is, it probably wasn't personal. He may well have believed this, but more likely he was trying to pressure the lead investor from our last round to commit to bridging us if need be. All so the complaining investor didn't have to mark his investment to zero while they were raising their next fund, probably.

(Also, he was very, very wrong 😁.)

So, this may be what you're walking into. All you can do, really, is make sure you act and sound like a CEO, and drive healthy growth in your startup. At the end of the day, that's what investors want.

Here are a few specific things that may help:

• Realize the board (ironically) has little power over you. They can fire you, and weigh in on a few kinds of decisions. If you're not generating tons of revenue, though, firing you soon after the original CEO leaves will almost certainly tank the company. Embrace this as freeing - you should listen to their advice, but then you should do what you think is best for the company, not what they think is best.
• Think through how you want to act as the CEO with the board. Put it in writing, and review before each meeting. This sounds a little hokey, but it's an exercise my coach suggested way back in the day and I still review my notes before board meetings.
• Make sure your board decks are at an appropriate level for the CEO talking to the board, not too operational.
• If there's lots of negative chatter coming back to you, talk to either your lead investor or whoever else has power. Tell them the gossip you're hearing, and let them know that if you're hearing it, it's probably getting out into the ecosystem. You're concerned that could harm your ability to fundraise next time around. It needs to stop for the future viability of the company. (It's not personal...it's about the company...)

Your employees

One of the hardest pieces of transitioning into the CEO role is shedding your old role. If you're still doing your old job and some of the CEO's job, you're not actually doing the job of the CEO.

You need to figure out what you're going to do organizationally as soon as you possibly can. This may mean hiring someone to replace you, finding a chief of staff, or simply reallocating responsibilities among your current staff. It's really important to make a clear decision, communicate it, and enforce it.

You are going to have less time for your colleagues because you have more external responsibilities. They may feel resentment, like you've deserted them, or even some helplessness. Just keep reinforcing how you expect them to solve problems and which issues should or should not be escalated to you. You should see the negative emotions start to dwindle as everyone settles in. If not, consider whether you made a less-than-optimal decision redistributing responsibility, or if you have an employee or two who can't work independently enough in your new organization.

Either way, act accordingly.

Yourself

This one feels like it shouldn't be hard! Hopefully, you were excited to take on the role of CEO, despite whatever emotions you had about your cofounder leaving. And yet, you've carved patterns of how you do things in your startup that you have to actively undo. So it is hard.

Initially, I kept getting pulled into work I had always done, and I didn't have enough time to do some of the more strategic work. This happens in part because some of what a CEO does is nebulous in output. If you had ten investor meetings and were quoted in the press three times this week, can you check anything off your to-do list? Did you make actual change for your startup? Probably not, and yet the accretion of these over time is exactly what bends the curve for you. Yet the complete-a-task-check-it-off dopamine of the other cofounder's job will keep trying to suck you back in.

My coach had me do an exercise that was really helpful. I wrote a job description my old cofounder role and one for my cofounder's CEO role. Then I highlighted (across both of them) which responsibilities should belong to me as CEO going forward. Then I circled the parts of my old job (plus one or two things from my cofounder's CEO job description) that I was currently doing and shouldn't be.

That told me two things:

1. What tasks I needed to reassign, hire someone for, find a freelancer to do, or stop doing
2. What tasks I should assess my performance against, because they defined the CEO role.

I found I couldn't get into the headspace of the CEO until I dropped the majority of the non CEO tasks on my plate. And once I did, relationships with my board and investors and employees got easier. And, best of all, the clutter in my head eased.

The hardest thing about taking over as CEO from your cofounder isn't the job; it's how perceptions of you shape how you do the job. Work on those and the rest will follow.

I'm not your lawyer, your therapist, your advisor, or your accountant. We're just internet friends, and these are just my experiences and personal opinions. Consult professionals for advice before you make any sudden moves in your startup.

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