Insights: To be or not to be CEO of your own startup

Image: Getty Images/ For illustrative purposes

The journey from start-up to a thriving and sustainable business is challenging and complicated, requiring entrepreneurs to wear many hats along the way. From visionary to operations manager, human resources director and chief marketing officer, business owners are required to fulfil all these roles and more, until the entity has gained a foothold in the market and has a real fighting chance of survival in its sector.

But now, as founder, you’ve reached a crossroads, wondering whether you should stay on as CEO or step down. As passionate as you are, this is the time to remove emotion from any decision regarding the future of the enterprise. Should you take an early exit and leave the day-to-day running of what is your baby to someone else, or should you stay at the helm as CEO and steer the ship yourself?

Should I stay or should I go? How to decide.

At this stage in the company’s development, the question is, what is needed to take it to the next level? Where does the business sit in the competitor landscape? Is it performing optimally, and what are the projections for sales of your product or service? Is the company adequately resourced to achieve your goals and objectives? Take a long, hard look at the facts and figures and build an honest needs assessment that might – or might not – include you in a leadership position.

At the same time, a skills analysis of everyone working for the company – some of whom may have come aboard at the very beginning of your journey – is also required. You may need to move people around, redeploy them as the company’s growing needs demand, ensuring they are working where their skills will be best utilised. Take your personal growth into consideration and decide what more you can bring to the company now that it’s achieved a certain level of stability and even success.

What it takes to be an effective CEO

Entrepreneurs are not always wired to be business leaders. They are big ideas people, often ill-equipped to manage a functioning operation. An effective CEO needs many essential qualities. They need to lead from the front, taking a strategic overview, putting systems in place but delegating actual operations to key staff members. CEOs need to manage investor relations, ensuring that financial partners get the ROI they were looking for. A CEO also needs to explore opportunities to scale and to guide the company through transitions of size or operational focus. Above all, CEOs need a certain level of detachment to make the tough decisions that ensure the longevity and profitability of the business.

To be…

As the company founder, you clearly have an advantage should you choose to be the CEO. You’re the only one with the product and institutional knowledge – not to mention the agility – to get this done. You are deeply invested in the company, both emotionally and financially. Maybe the company is still too young or small for you to relinquish control, and you are the one driving momentum and morale now that things have started to happen. Perhaps you are only just growing into your role and have a lot more to give.

So, if your objective view of the company’s needs and of your own skills leads you to believe you are the best person for the job, and you are ready to stop doing and start leading, delivering on your original vision for the company, then the CEO role should fit like a glove.

…Or not to be

But perhaps the reality is that you’re not the right person to take the company forward. You might be feeling burnt out from the crazy ride you’ve been on so far, and maybe you’ve lost the strategic vision you once had. Perhaps you’re receiving negative feedback from the board or staff and have skills gaps that are hindering the company’s progress.

If you had a succession plan in place from the outset, hopefully your replacement is ready to step in and take over the reins in a seamless handover. Alternatively, if there is no one with the necessary skills, start the recruitment process and begin planning your exit and new role.

Defining your new role (whichever way you go)

Your future – inside or outside of the company – depends on your plans for your business. Perhaps that plan is to scale and sell, in which case your job will be to ensure the growth and expansion of the business and to guide the new leadership through change. If your goal is to build a legacy for your family or children, you need to plot a steady course and look further into the future while keeping an eye out for new markets or product diversification. In this case, the growth trajectory does not need to be as steep or urgent, and you can afford to explore many different opportunities. You may stay involved as a founder member or take a position on the board. Whichever path you choose, forge a role for yourself where you will have the most impact.

Rashid Mohammed is the head of Revenue & Strategy at SPC Free Zone.