How to transition from entrepreneur to CEO in 2023
In this guest article, Rachel Turner, Co-founder of VC Talent Lab, explains how entrepreneurs can transition to CEOs as their businesses scale in 2023.
The founder to CEO journey is fraught with difficulty.
The typical CEO of a large corporation will have spent 15 to 20 years growing and developing first as a manager, then as a leader, before they get a crack at the top job. The founder of a fast scaling start-up in the meantime, may be expected to shift from entrepreneur to CEO in 12 months not 12 years.
What founders typically do as their business scales is to double down on the things that made them successful as start-up entrepreneurs. They work harder, pitch more furiously, run from problem to problem putting out fires. The problem is, what made you a great entrepreneur will make you a dreadful CEO.
To shift from founder to CEO you need to first understand what your business is going to require of you as a leader as it grows, and the style of leadership which is best suited to that:
|At the start up phase, the fledgling business needs you to:||As you start to scale the business, you need to:||And as the business grows to maturity, it needs you to:|
|Be single-minded in pursuit of a goal||Be thoughtful about people and process||Be the inspiring figurehead|
|Have bulletproof self-confidence||Have a high degree of emotional intelligence||Have enormous gravitas and presence|
|Be a brilliant tactician||Be a brilliant systems thinker||Be a brilliant strategist|
|Convince people one-to-one in pitches||Build consensus and high performance in their team||Inspire/reassure large groups of stakeholders|
|Have lots of ideas and be able to flex between them||Assess and implement a few new ideas||Identify and implement one or two game-changing strategic ideas|
Entrepreneurial Leadership (Brave Warrior Mode)
(Considered Architect Mode)
(Wise Monarch Mode)
Most founders are natural Brave Warriors, which is why they’ve been successful at the start-up stage. The challenge for the founder of a scaling business is to change gears effectively, and at the right moments. One of the biggest problems a scaling business faces is when the founder keeps warrioring when the business needs architecting or monarching. Here are some examples:
A client complains. As a Brave Warrior entrepreneur you jump in the mix and fix the problem. As a CEO, this approach causes chaos. Instead you need to pause, think about who else needs to be involved in the conversation. Speak first to your team, collectively agree on a way forward, then act.
You have a big event coming up. As a Brave Warrior entrepreneur with a couple of people working with you, it’s all hands to the deck, late nights, flurries of emails. As the business grows, this causes chaos – your head of marketing thinks they should be in charge, the head of sales thinks they should, no-one has a plan and you’re annoyed. Instead slow down and make a plan, ensure everyone is clear on their roles and responsibilities, and hold the team accountable for the delivery of the plan. Stop warrioring, start architecting.
You’re tired, hungover and grumpy, and have just had a bad meeting with a supplier. As a Brave Warrior entrepreneur it’s OK to let off steam in public. If you do this as a CEO of a large organisation, you’ll cause all sorts of problems. People will panic and gossip, culture will suffer. As a CEO what you do and say is magnified 10x, so let off steam in private, then deal with the challenge with a cool, calm head back at the office.
You come up with a new idea, the third this month. As an entrepreneurial Brave Warrior – no problem. You and your few direct reports can flex and bend on a daily basis. As the Considered Architect or Wise Monarch, you can’t do that. Instead you need to pick just three or four big ticket strategic ideas which you will implement over the next year.
If you recognise yourself as a Brave Warrior who needs to grow some Considered Architect or Wise Monarch muscle, here’s where to start:
- Slow down. Before you plunge into action pause and ask yourself ‘Who needs to be involved here? What impact will this have elsewhere in the team? How would what I’m about to say sound if it was on the homepage of our website?’
- Stop doing, start architecting. Whenever you want to leap into action, ask yourself ‘How can we solve this problem, at source, with a process or a system or a team?’
- Implement ‘Minimally Viable Management’. You need to plan with your team at least once a quarter, track progress with them at least once a month, and huddle with them at least once a week. You need to ensure each of your direct reports is crystal clear on their role and your expectations of them in that role.
- Manage yourself. The biggest enemy to your success at the scale-up stage will be your impatience, resentment, intolerance or tiredness. Hire a coach or a therapist, take epic care of your physical energy and practise some simple deep breathing.
- Build a personal support network who can advise and inspire you. Include in your network a peer, a mentor, an expert, an industry insider and a role-model.
- Learn about leadership. We give every founder we work with two books: The Founder’s Survival Guide (which will show you how you need to show up as a leader) and The Advantage by Patrick Lencioni (which will show you how to build a high-performance team and a healthy culture).
As the founder of a scaling business, you have achieved something extraordinary. You took an idea and from it you created something real. You have a combination of vision, passion, commitment, bravery and determination that is awe-inspiring and I salute you.
As you think about the future of your business know one thing: what got you where you are, won’t get you where you want to be. But you are tenacious beyond belief, and with willingness, a dab of humility and the tools outlined above, the next stage of your venture can be as successful and thrilling as the start-up was. Go well on the adventure with my admiration.