FROM STARTUP FOUNDER TO STARTUP CEO - NOW WHAT?

The Pre Money Scenario

In many instances, one founder tolerates the drudgery of administrative functions then gradually evolves into the sole contact person concerning operational issues. Eventually, when the firm develops and operations become more formalized, this founder assumes the title of CEO.

The Post Money Scenario

A heavyweight angel or seed stage/early stage VC agrees to invest in a Startup then recommends the immediate recruitment of experienced Board Members and Senior management staff.

The logical conclusion is usually to hire persons who firstly, have a background in administering budgets similar to large-scale VC funding in a consumer tech or enterprise tech company.

This path is logical and based on historical data that often proves that the money and operations management responsibilities should reside within the hands of an experienced manager. However, it is unlikely that many experienced managers will understand the challenges that present day Startups face in terms of User-centered product development, User engagement, Usability design, and the psychology of youth consumerism.

There is a need for VCs to actively encourage suitable Startup Founders to prepare themselves for the position of CEO at the onset of venture funding.

VCs can significantly reduce the learning curves of Startup Founders turned CEOs by:

Identifying Managers And Academicians To Act As Mentors And Confidants

Requesting Weekly Progress Reports Detailing Strategic And Management Progress Then Offering Timely Feedback

Hire Consultants To Provide Strategic And Management Counsel

Startup Founders need to understand that they can make the greatest tangible contributions to improving the probabilities of the company’s success by taking on greater levels of responsibility and accountability as CEOs.

Startup Founders turned CEOs can significantly reduce their learning curves by:

Actively engaging with Board Members

Forming an Advisory Board of successful Entrepreneurs, CEOs, COOs, CFOs, CIOs, etc.

Choosing a serial Board Member as a Professional Mentor

Choosing a Life Coach or Astute Company Outsider as a Personal Mentor

Reading and Researching Management Principles and Tech Industry Trends Voraciously

Closely Analyzing The Behaviors And Strategies Of Recent Startups

The Need For A New Direction

VCs are having great difficulty deconstructing, understanding, and adapting to the new Startup manifesto that is exemplified by Y Combinator, 37 Signals, Obvious Corp., CRV Quickstart, among others. Successful Startup Founders, usually Under 40, are thoroughly familiar with the cultural, social, and environmental codifiers that signify the new consumerist logic prevalent among prime consumers. With a studious approach to quantitative analysis and business communications, many Startup Founders can become successful CEOs.

What CEO Founders Can Do To Succeed

Founders who become CEOs must evaluate and address a seemingly infinite number of dilemmas. To list many of these problems would be exhaustive. Consequently, I will list a few areas of critical importance where a CEO Founder must make tactical and behavioral modifications in order to lead a company in a sustainable fashion.

The CEO Founder is expected to forge a new vision for the company and scale operations quickly. Moreover, the CEO Founder must work with the VCs to form a new Board of Directors.

Among many things to consider are:

Think ‘Intelligently Designed Growth’

CEO Founders must make a concerted effort to fully understand that the Startups’ success will be judged quantitatively not qualitatively.

Growth is the only way to assure the viability of a Startup.

Even Bootstrapped companies aim to stay small in terms of costs and infrastructure, but scale big in respect to product development, research & development, and User outreach (customer service).

The key is to think big and invest wisely in proven mechanisms and strategies that deliver exponential User Growth.

Know Your Company And Market

Board Members and VCs need CEO Founders to answer the following:

Are you satisfying the needs of your current Users?

Are you selling them a product or providing them with a Solution?

Is your Solution a Vaccine (preventative)?, a Treatment (short term remedy)?, or a Cure (final, unequivocal resolution)?

How will you continue to provide a similar level of User satisfaction when the total number of Users grow exponentially this year?

Will your technological infrastructure and customer service systems be able to handle such a dramatic increase in volume?

Are the next generation of Solutions ready to solve a broader range of User problems and grow the market exponentially next year?

How would you respond to the development of unforeseen circumstances in the marketplace resulting in cataclysms shattering the validity of your assumptions?

What type of events or trends would erode your value proposition?

Do you have a contingency plan to restructure the company and capitalize on new markets?

What is the cost of implementing your contingency plan?

Challenge Board Members To Focus On Users’ Interests

Many new Board Members advocate new technologies and new sales approaches that CEO Founders have not tested or are unfamiliar with. Often, Boards become fixated on the strategic directions and competencies of other firms that are usually market leading public companies.

Consequently, they intentionally or unintentionally, encourage CEOs to implement similar policies and procedures according to a perceived ‘industry standard.’

CEO Founders must execute a strategic plan to grow the company in accord with the needs of their target markets.

CEO Founders must consistently steer Board Members towards empowering the company to focus primarily on anticipating and fulfilling User needs.

Delegate And Monitor

Founders Do.

CEOs Communicate, Delegate, Then Manage.

CEO Founders must forget about Doing and Focus On Managing.

CEO Founders should focus on the development and execution of ‘replicable processes’ throughout the organization.

The key to a Startup’s sustainability is the capacity to scale core operations quickly and efficiently. Scalability is linked invariably to a CEOs ability to implement ‘Replicable Processes.’

Become A Behavioral Scientist

Consume and Use the offerings of your competitors insatiably.

Actively engage with Users at multiple online and offline venues - social media sites, social networks, social shopping sites, blogs, photo sharing sites, video/music sharing sites, dating sites, cafes, tradeshows, conferences, unconferences, sporting events, contests, etc., etc.

Learn to spot trends early.

Produce next generation Solutions that create new markets, and steers Users towards your Solutions.

Build committed relationships between your company’s Brands and Users.

Join The Perpetual CEO Conversation

Work closely with your PR rep.

Join a Speaker’s Bureau.

Get involved. Blog. Attend unconferences, conferences, boot camps, bar camps, etc., etc.

Keep studying your industry and become recognized as an expert. This adds value to your company’s Brands.