Founder / CEO Succession

Posted by On December 10, 2007 3 Comments

Professor Noam Wasserman has a nice piece on founder / CEO succession in HBS’s Working Knowledge.  To summarize he talks about the heads-you-win-tails-I-lose phenomenon that founders face as they grow their business, i.e. if they fail they get replaced and if they succeed they also often get replaced.  I think what Noam is observing is actually the case, but in the "success" scenario, I don’t think that success is causal with replacement.  More likely it is some new aspect of the larger, more successful business that other board members perceive the founder as not being able to manage (e.g. more of a focus on sales management than new product development).  Either way, the lesson is clear to founders: success in a startup doesn’t guarantee you get to keep your job.