Why Startup Founders Don’t Want to be Startup CEOs

As a Startup Founder with more than a handful of employees and a bit of traction you are quickly confronted with an obstacle.  You need to be more than a Founder. You need to simultaneously be a CEO.  But what motivates you, excites you, gives you passion as a Founder just isn’t there when you need to put on your CEO cap.  Let me share with you some of the differences in the two roles and offer one piece of advice.

In the career management literature, there are 4 career path preferences. Your career path preference is highly indicative of your overall job satisfaction. They are:

  1. Specialist
  2. Generalist
  3. Entrepreneur
  4. Manager.

These “career path” labels offer researchers a way of grouping people who share a similar set of underlying interests, values, motives and anchors.

Motivational Anchors for Entrepreneurs

As entrepreneurs, we thrive on diverse projects or problems with measurable and visible outcomes. Typical motivational anchors are:

  • Autonomy,
  • Variety,
  • Risk,
  • Challenge,
  • Change and
  • Freedom from constraints

These are the reasons we get up in the morning, get excited about what we are doing, “float our boat”.

Motivational Anchors for Managers

The research literature tells us that people who prefer a Managerial path are interested in increasing power and authority (although you’ll probably need to get them tipsy before they’ll admit it). Typical motivational anchors are:

  • Power,
  • Influence,
  • Leadership,
  • Control,
  • Status,
  • Managerial competence and
  • Directing others

These anchors are not motivating to us.  Most of us have spent our work lives and often our personal lives trying to get away from those who possess and inflict these qualities on us.  Now as a new CEO we are being told we have to demonstrate these anchors in order to be successful.  Not fun.

Motivational Anchors Are Intrinsic Motivators

Intrinsic motivators are strong predictors of what people are able to focus on over long periods of time. There isn’t a lot of overlap between the manager and entrepreneur anchors. If you’re forced to figure out ways to lead, control, direct, etc. when you really want to be doing things like working autonomously, taking risks and thinking outside the box, which set of activities are likely to win your attention?

You could say that you’re managing because you want to build a great company, change the world and be set for life in 5 years. That’s fine, but these are all extrinsic motivators. Extrinsic motivators are very, very ineffective sources of motivation over the long run.

The transition from entrepreneur to manager is made that much more difficult because of the conflict between your external motivators (you want to built a great company and create generational wealth) and your intrinsic motivators.

Even for those who have the intrinsic motivation genetic pre-disposition to be both a great manager and leader, it’s really hard to learn the new skills and behaviors and habits that are actually required to get the job done.

But what if you don’t have the intrinsic motivation?

We’ve all seen the best engineer or sales guy (specialists) who love their job and are killing it for the company, so they get promoted to management.

These “rockstars” turned managers are happy for a while because they got a fat raise and a title (extrinsic motivators), but eventually they realize how much they hate managing/influencing/wrangling others all day. Usually they start to hate life and will either burn out or leave.

Pretty much the same forces are at work when an entrepreneurial founder has no choice but to become a manager. There is a way through it. Leadership can be taught and, once you figure it out, it is rewarding.

So here is my one piece of advice.  Don’t fight it.  Accept it and get on with mastering what you need to learn.  It is the only path available to bring your great idea to life.

In the next part of the series, we’ll explore how you can get started with your own leadership development plan. It will be tough, but it’s up to you to take the first step.

This is part 3 of an ongoing series to help startup founders successfully transition to startup CEO. In part 1 I acknowledged that even though management is a weakness, but cannot be ignored. In part 2 I talked about how startup founders typically aren’t born with a taste for leadership.

2 Takeaways From GitHub Running a #NoManager Company At Scale

Zach Holman has been giving presentations on how GitHub works for the last couple years. If you’re not familiar with GitHub’s organizational structure, they don’t have any managers and they are mostly remote. It’s been pretty fascinating to watch them grow up with this structure and I’m grateful to Zack for sharing their journey along the way.

The last time Zach presented an update, GitHub had about ~75 employees. They’re now up to 217.

Here are my takeaways from Zach’s latest presentation:

1. Retention Rates Are Ridiculously High

As far as I’m concerned, this is the only slide that matters.


199. That’s the number of people GitHub hired before a single person quit. 

There are two mission-critical reasons you need to care about cultivating a developer-friendly culture. First, culture is a form of advertising that can attract the best people you can afford. Second, living the culture that was advertised should retain those people for as long as possible.

GitHub literally had 0% voluntary turnover for years. This is mind-blowingly awesome and the #1 reason tech-focused founders should take a really close look at whether or not they should build a company without managers.

2. Managers May be Be Optional, But Leaders Are Not

Zach revealed that they now have teams:


The slides don’t explicitly tell us how the teams are organized, but from what I can infer it seems like people can join or leave a team based on their interest in what the team is working on.

Some teams have a “Primarily Responsible Person” whose main job is to provide a vision:


Vision is a function of leadership. In early-stage no manager companies, the visionary should be the founder(s). Even though leaders won’t tell employees how to do their work, they should tell them when something doesn’t fit in with the company’s mission or vision. 

When the product functionality and headcount swells, it makes sense to bring in product/team-level leaders. They can inspire others to see the big picture and offer the doers a way to know whether or not that new thing they want to work on next will push the company closer to achieving their stated mission.

For example, Treehouse recently went to a no manager structure. Here’s how they handle the mission and vision (source):

Who decides company-wide priorities? Who sets the general direction for the company?

Alan and Ryan (the Co-Founders) are actively steering the ship and setting company-wide goals, our Mission Statement and areas of focus.

What are the Co-Founder’s roles in this new system?

Ryan and Alan are still very much leaders of the company. They will decide on company-wide goals, make sure our Mission remains relevant driving force, and keep our current areas of focus updated.

This makes sense for Treehouse, but every company and every founding team is going to be different.

Watch the Presentation

The whole presentation + slides is available here. It’s definitely worth the hour-long investment.

Why I Want to Help Startups Build Great Companies

I despise the methods many established companies use in an attempt to “manage” the performance of the builders and the doers. That’s the short answer, but there’s actually a lot more to the story. Allow me to explain.

I cofounded a company called Envisia Learning 10 years ago with Ken Nowack, Ph.D.  Our vision is to increase the quality of people’s work lives by improving the effectiveness of leaders.

Ken is the brains of the business. He’s a highly-respected industrial organizational psychologist, researcher and executive coach. He’s also a soon-to-be-named associate editor of an American Psychological Association academic journal, and he lectures on leadership at the UCLA Anderson Executive MBA program. He’s basically an encyclopedia of evidence-based best practices in organizational development.

I’m equal parts developer and “business guy.” I first met Ken 15 years ago when I was doing freelance web development. I helped him put a few of his surveys online, and we continued working together on various projects for a few years. Eventually Ken and I decided we liked working together so much that we partnered up to focus on building and selling products together.

What Envisia Does

I head up the technology and business side of things, Ken acts as the research and theory side. Together we’ve built a suite of products and services to help leaders learn how to be more effective. Most of our customers are large, established companies.

Leadership development requires leaders to learn new behaviors, which means:

  1. Leaders need to know what they’re doing well and not doing so well. 360-degree feedback is the best tool for the job, but it has to be done properly (if you just cringed when I said “360-degree feedback,” then you are not alone and probably worked at a company that did it poorly).
  2. Leaders need help interpreting their feedback and setting goals to actually do something about it. Usually companies use seminars, workshops or 1-on-1 feedback meetings with a qualified coach or consultant.
  3. Finally, leaders need someone to hold them accountable and provide ongoing coaching or mentoring.

One of our products is called Momentor. It’s a goal setting system designed specifically to help people achieve behavior and habit-oriented goals. It’s taken us over five years to get Momentor right, and there isn’t really anything else like it on the market.

When we show Momentor to prospects at enterprise companies, the response is overwhelmingly positive, but we don’t convert enough of them. We dug deeper to figure out why, and the reason was almost always the same. They had just purchased SuccessFactors for $X00,000 to do their performance reviews, and part of that is a goal-setting module. Even though they like Momentor way better and felt Momentor was more appropriate, they can’t have goals in two places because (insert political reason here). Ugh.

If We Can’t Beat ‘Em …

We decided that, in order to compete for these big contracts, we’d need to extend Momentor’s features so it could do performance reviews as well. That would mean Momentor would have to evolve from a “Talent Development System” to a “Performance Management System.

Performance management systems are what most established companies have been purchasing over the last 10 years to replace old paper and pen or spreadsheet-based performance review processes. They’re designed to support a Management by Objective (MBO) performance review processes that was conceptualized by Peter Drucker in 1954. MBO has become the de facto standard and is used by just about every established company to determine performance objectives, development plans, raises and bonuses.

I haven’t met any managers that enjoy the performance review process and most employees find it to be downright demoralizing. I was hoping we could win by figuring out a tolerable process for doing them.

After reading through the research and brainstorming alternatives, I realized there is no better way. The effect of any form of performance review that is tied to decisions around compensation and bonuses is a net negative. I realized the only right way to do performance reviews is to not do them at all.

There Must Be a Better Way

Next, I sat down with Ken and we listed the intended purpose of the ideal performance review process. Here’s what they’re supposed to do:

  1. Provide a fair way of determining how much of  a raise and bonus each employee receives
  2. Provide a structured and scheduled way to discuss employee performance (good an bad) and come up with a development plan for the next X months
  3. Provide a way to discuss and mutually agree upon a set of performance goals that are linked to higher-level objectives for the next X months
  4. Provide a legal justification for firing
  5. Support succession planning and decisions around promotions

I looked for practical examples of companies that figured out innovate ways to get all the benefits of the performance reviews without the demoralizing side effects.  I figured we weren’t the first people to see how ineffective and demoralizing performance reviews really were. The single biggest problem was that compensation issues overwhelmed and undermined the whole review process.

I could not find a single established company that was doing anything but a variation of the standard MBO performance review process. Dead end.

Until I Found Joel Spolsky

The first glimmer of hope came from a 13 year old article from Joel on Software (by Joel Spolskly, then-CEO of FogCreek Software) about why incentive pay, and performance reviews, were harmful. I dug deeper and found that he instead offers a transparent compensation policy, profit sharing instead of performance bonuses and ongoing feedback/coaching instead of an annual event (all practices that Joel  has carried over to StackExchange).

I started looking at other startups and small technology companies to find practical examples of organizational structures that ditched compensation-linked performance reviews . I found:

  • Companies like Buffer, FogCreek and StackExchange had transparent compensation policies. Compensation at these companies have nothing to do with whether or not employees achieved arbitrary performance goals. People were compensated purely on their skills, scope of responsibility and experience, which should be what they’d earn if they found a new job.
  • For bonuses, FogCreek offers profit sharing. Shopify pays bonuses based on peer recognition.
  • At Buffer and Shopify (and many other startups), employees receive regular feedback to help employees grow and understand where they stand, but the feedback is completely separate from compensation or performance goals.
  • At many startups, agility trumps the need for annual goals. Instead of employees worrying about achieving a list of three things over the next 12 months, the best founders have a compelling vision and a mission that supports their vision. They work with their team to experiment until they find the best way to achieve their mission.

All of the startups I found that shunned traditional management and organizational processes had something else in common. They were all either wildly profitable, growing like a weed or both.

From my research came an epiphany.

As Ken and I discussed how various startups organized themselves and compared them to the latest research and best practices, we realized that a company cannot simply decide to kill a performance review and all will be well. The difference between a company like Buffer and Microsoft are systemic and the chances of making any major cultural changes to a company like Microsoft are nil.

We noticed that a company with a traditional organizational structure that thrives without performance review must have:

  • A fair and obvious compensation policy
  • Bonuses that are decided by someone other than your manager, and ideally not linked to performance at all
  • Managers who are committed to developing their people as a daily part of their job
  • Managers who actively seek ways to serve their people and make them more effective
  • Managers to take an active role in advancing their people’s careers

We realized to have the kind of company that didn’t do performance reviews, you needed to basically change the role of manager. You had to take away most of their power and leave them with the sole purpose of coaching, mentoring and serving their team.

Thinking about the limited role of managers in the ideal company lead me to consider another question …

Do Startups even need managers?

If the goal of any startup is to get as much done as possible as quickly as possible, and the best companies are driven by a strong vision and mission, do the builders and the doers even need someone telling them what to do?

Again, I turned to the technology and startup world to find practical applications. It turns out there are companies like Valve, GitHub and Treehouse that offer completely flat organizations.

These companies are 100% doers and creators. The only direction people have is from the company’s vision and mission. There are no politics, no rumor mill, no one to demoralize or get in the way of what needs to be done.

The #1 business-oriented reason to care about culture is to make sure you are attracting great people and retaining them for as long as possible. In a recent presentation on how GitHub works, they gave the world the most compelling reason to consider a no manager company that I’ve ever seen. GitHub made it to 199 hires before a single person quit. They had 0% voluntary attrition for years. This is unbelievably amazing.

To change the world, we must start with the next generation

Ken and I thought maybe other companies should consider doing what GitHub is doing. We compared our notes on how these no manager companies are run and looked at what it takes to make sure employees still get paid fairly, make sure employees still have opportunities for growth and development and make sure employees are working on things that are meaningful to the long-term success of the companies they work for.

As it turned out, there were some universal processes that companies could follow. Even better, most of these frameworks would benefit both companies with or without managers. We realized that our background put us in a position to develop these processes into frameworks and products that would change the way companies are managed.

We can teach founders why no manager companies make sense and how to implement the organizational structures that support them, then build software that makes it easier to support processes around compensation, bonuses, peer reviews, etc. that are required to keep everything running smoothly.

For founders that aren’t ready to give up on managers entirely, we could teach them how to build companies where managers’ only choice would be to act as great coaches and facilitators who exist to serve their people.

We asked ourselves things like:

  • What if we start a blog that helped people understand why traditional organizational and management structures are outdated and there is a better way?
  • What if we wrote a book to dive deep into the specific research, examples and concrete steps to help them create the kind of company that made it impossible for managers to demoralize and demean employees? What if we wrote the book on creating a company without managers at all?
  • What if we offered coaching and consulting to help startup founders and executive teams with the transition?
  • What if we created talent management software that supported the way companies will be managed in the future?

We not only realized we could actually do all of these things, but they’d be a lot of fun, as well.

 The Game Plan

This blog and the new line of products and services we’re creating for startups is my pet project, fueled by my passion for entrepreneurs and the possibility that we can be a big part of a world-changing revolution.

I mentioned in my previous post that we plan on doing things like coaching, consulting, writing a book and developing products that will change the way companies are managed. This seems like a lot to bite off at once, but they all reinforce each other.

For the time being, the team will be small and I’ll borrow folks from the Envisia side of the business as needed until we’re up and running. Here’s how everything will be tackled.

  • I’m writing this blog myself and will continue to do so for the immediate future
  • I’ve hired a freelance writer who recently retired from designing and delivering management training. He’ll be helping with the book.
  • Ken will deliver all consulting work. We can help founders by offering solutions for hiring, firing, peer reviewing, compensating, bonuses, communicating and professionally developing people in a no manager (or minimal manager) company. This is where you need science on your side because decisions you make today may cause failure over the long-term.
  • Sometimes leaders or founders will struggle with how to lead a no manager or minimally-invasive manager company and require some coaching. We have a few coaches that can help with that.
  • I’ll be developing the minimally viable product for our first SaaS product that support “NoManager” (or minimally invasive manager) companies myself. Eventually I’ll bring in others to help, but right now it is actually easier to explain my ideas and solutions by building them.

We’re both excited and a little bit scared about our mission to change the way companies are managed. If anything in our story resonates or if you’d like to begin the process of building a company that is free from politics, rumor mills and demoralizing management, l’d love to talk to you. Just leave a comment below and I’ll get in touch.


Google People Operations

This is an awesome description of the ideal role of HR in a technology-centric startup:

Made up of equal parts HR professionals, former consultants and analysts, we’re the champions of Google’s colorful culture. In People Operations (you probably know us better as “Human Resources”), we “find them, grow them, and keep them” – bringing the world’s most innovative people to Google and building programs that help them thrive. Whether recruiting the next great Googler, refining our core programs, developing talent or simply looking for ways to inject more fun into the lives of our Googlers, we bring a data-driven approach that is reinventing the human resources field.

Yesterday Ryan Carson shared this article on how Google does managers, which is all sorts of awesome as well.

Everything that Google has learned on their own is consistent with the best practices that we have available to us in the research literature. My company already has a data/evidence-oriented culture and we have developed similar tools that Google uses to assess and develop their managers.

This makes me wonder if we could position ourselves as “PeopleOps as a Service” to bring many of the benefits that Googlers are enjoying to everyday startups.

(via People Operations – Google Jobs.)

My Mission and Committment to Transparency

My team and I are on a mission to change the way companies are managed. I feel a bit absurd saying it out loud, but it needs to happen and we’re in a great position to do it.

We’ll be consulting, coaching, writing a book and building a suite of SaaS products that will enable startup founders build “no manager” or “minimally invasive manager” companies. We believe these management structures will soon be the only options available to startup founders that want to attract and keep the very best people.

Traditional advice and management books won’t help you navigate through all the challenges you’ll face while baking these innovative management styles in to your culture, but we can. My cofounder and I have been working with established companies for a combined 42 years. We have extensive expertise and understand the science behind hiring, firing, coaching, feedback, compensation and measuring performance.

Instead of traditional customer development, I’ll be blogging about what we’re doing with as much transparency as possible. I plan to explain what we’re doing as we’re doing it so I can help you understand the “why?” behind the decisions we bake into our products and services.

I gave this “transparent development” thing a trial run a couple weeks ago. I built a premium newsletter service in a week and live blogged the entire process. I wrote 26 posts outlining every single decision with complete transparency. The blog has been a great way to bring customers closer to the product and help them understand why I made the decision I did. The response is overwhelmingly positive.

I’m looking forward to taking a similar approach here at Great Companies as we build tools and products that help startups build great companies with happy and highly productive employees.

Sign up using that form below to follow our journey and get some discounts when our book and other products are ready for launch.

Be a Minimally Invasive Manager

I literally want to quote the entire article, but this pretty much sums up management’s role in building a great company:

In the world of minimally invasive management, managers have three primary jobs: they need to hire; they need to develop and serve their people; and they need to fire.


When Product Development is Better Than Customer Development

The Lean Startup movement and its reliance on customer development and validated learning is great, but it doesn’t make sense for every situation.

If I have cancer, I don’t want my doctor to ask me if I’d pay for a particular solution to cure my cancer. I want my doctor to tell me how to get rid of it in the most effective way possible given their experience and knowledge based on their access to the latest research, techniques and medicines.

Serious Pain Sometimes Requires a Prescription

If you’re an entrepreneur with deep expertise in a particular domain, sometimes you already know that a particular pain point exists. You don’t need interviews to confirm the pain.

And sometimes your domain expertise allows you to understand whether or not you have a solution to the pain that is better than anything being offered. You know everyone hates the solutions that exist, but customers are stuck because there isn’t anything better to choose from.

And sometimes you know your potential customers are willing to pay for existing solutions designed to fix their pain (even though it doesn’t) at a price-point that you’d be happy selling your superior solution at. You don’t really need to bother with the “would you pay $10 if I could take this pain away?” type questions.

If this is the case then whole-hog customer development feels like a round peg/square hole kind of situation. A prescribed solution may be in order.

Customer Development Isn’t Always The Answer

37 Signals built Basecamp and launched it as a fully functional product to solve project communication problems. They didn’t ask what we’d pay and they didn’t ask if we wanted it. They understood the pain that some project managers felt every day and they built something to take away that pain.

Amy Hoy built Freckle and launched it as a fully functional product to solve agencies’ time tracking problems. She didn’t ask what we’d pay and she didn’t ask if we wanted it. She understood the pain that some agency owners felt every day and built something to take away that pain.

Apple built the iPhone and launched it as a fully functional product to offer the greatest technological advancement of the century. They did it again with the iPad. They didn’t ask us what we’d pay or if we wanted it. They understand the pain that we felt with our phones and built something to take away that pain.

There are countless other examples, but you get the point. What all these examples have in common is that the creators used their domain expertise to identify a real pain point, they had strong opinions around the best way to alleviate the pain and they had the ability to create great products to solve those problems.

I’m Leaving Customer Development Behind (at least for a while)

My team and I are creating products designed to help founders build great companies and ease the transition from founder to CEO. I’ve been trying to follow the lean startup methodologies and ask what founders need to solve the pain, but today I realized it doesn’t make a lot of sense for what I’m working on.

The pain that founders experience around leadership and management as they build their companies is very complicated. It’s very real and I don’t need interviews to confirm it. The solutions are even more complicated than the pain. A decision you might make today around compensation policies or culture because it seems neat or trendy can have adverse effects that don’t show up for maybe 10 or 50 hires down the road.

Asking a founder what they need to solve their leadership and management pains is sort of like a doctor asking cancer patients how they want to cure their cancer. Asking them if they’d rather pay for chemo, radiation or both is just as ridiculous.

There is no panacea for building a product (or business). My approach to what I’m doing and this blog are about to change. Stay tuned.

Startup CEOs are Born Bad Leaders

Entrepreneurship sucks. I know it’s not cool to say it, but it’s true. And everybody wants to be an entrepreneur these days. That’s probably because they haven’t actually tried it (note: a couple WordPress installs doesn’t count).


Entrepreneurship is a constant roller-coaster filled with stress and ambiguity and joy and pain. Let’s be honest. If you could be or do something else, you would… Because entrepreneurship sucks.

But you’re different. If you’re the CEO of a budding startup with at least some traction, you’ve probably made it this far because you’re unemployable (and I don’t mean that in a bad way). You just don’t know how to be anything but an entrepreneur.

And, you may not realize it, but you probably have the perfect storm of genetically influenced personality traits that are well-suited to the job of running your own startup.

Unfortunately some of these strengths are also weaknesses when it comes time to transition into manager and leader so you can build your business.

You Were Born to Build a Startup

Some people say entrepreneurship is in their blood. It turns out there is some truth to that.

The flip-side is that you probably weren’t born to lead or manage… There’s some truth to the idea that good leaders and good managers are born as well. Let’s dig a little deeper into the research and what it implies for you and your ability to transition to great manager and leader.

First, it’s definition time. Psychologists have narrowed down the human personality to five main dimensions. Wikipedia has the full scoop, but here are the 5:

  • Openness to experience: (inventive/curious vs. consistent/cautious).
  • Conscientiousness: (efficient/organized vs. easy-going/careless).
  • Extraversion: (outgoing/energetic vs. solitary/reserved).
  • Agreeableness: (friendly/compassionate vs. cold/unkind).
  • Neuroticism: (sensitive/nervous vs. secure/confident).

I’m going to use these definitions and extrapolate meaning from dozens of academic studies on personality through the work of Tim Judge and colleagues at the University of Florida as well as Hao Zhao of the University of Illinois at Chicago and Scott E. Seibert of the Melbourne Business School .

You’re Probably an Introvert (I know. Stereotypes.)

If you don’t understand what it’s like to need to spend a day alone after Thanksgiving weekend  or a week at home with the in-laws, you’re probably not an introvert. If you aren’t an introvert,  you can skip this section and celebrate that you’re having a much easier time with the transition to an effective leader (lucky).

Extraversion is strongly correlated with leadership. It’s  the most important dimension for determining whether someone is likely to emerge from a group as its leader. Extraversion also has some predictive power for whether or not someone will be  an effective leader (Note: Extraversion was more strongly related to leader emergence than to leader effectiveness).

These results for Extraversion make sense, as both sociable and dominant people are more likely to assert themselves in group situation. The most talkative appear the most “leader like” initially.

Have you ever noticed how on Survivor (or any collaborative reality show) the person that is the first to speak up about what to do next winds up being the leader for at least a little while? That’s extraversion at work.

Often the early leader in the reality show becomes the most hated by mid-season. The luster of the energetic leader wears off quickly as people look for substance.

Without  a strong set of interpersonal skills (aka emotional intelligence), it’s impossible to actually be a great leader. Luckily, many of these skills and behaviors can be learned and have little to do with extraversion or introversion, but we’ll get to that later in the series.

Entrepreneurs Rule! Managers Drool!*

The research tells us there are statistical differences between entrepreneurs and managers in four out of the five personality dimensions.  Most of them are awesome. Let’s start with those:

  • In general, entrepreneurs can be characterized as more creative, more innovative, and more likely to embrace new ideas than our manager counterparts (Openness to Experience).
  • We score higher than managers on Conscientiousness (i.e., drive and work ethic).  The main difference was due to entrepreneurs having a higher achievement orientation when compared to managers.  Entrepreneurs and managers do not differ on other aspects of the Conscientiousness factor such as dependability, reliability, planning and organizational skills.
  • We score significantly lower than managers on NeuroticismEntrepreneurs appear to be more self-confident, resilient, and stress-tolerant than non-entrepreneurial managers.  These results make sense given the highly stressful, demanding, and changing  work environments in which we usually find ourselves. Entrepreneurs are able to tolerate a greater amount of stress without anxiety, tension and psychological distress.  This may help us handle ambiguity, take risks and feel greater comfort with failure.

*Except For the One Area That Matters Most When It’s Time to Grow Up

Here’s where the differences hurt our ability to transition from founder to CEO. Entrepreneurs tend to show lower scores on Agreeableness, meaning we are tougher, more demanding, and more likely to use more negotiation and influence skills than managers.

This is a nice way of saying we have a tendency to steamroll people. Instead of asking for ideas, building consensus and allowing people to be their best, we tend to feel more comfortable with command and control leadership styles.

Command and control actually has a place in a leader’s tool-belt. It is quite effective in the short-term and during some dire situations, like when you’re on a sprint to build your company and get that traction before you run out of money. But that doesn’t last forever. Eventually command and control leadership turns into a cancer that can kill your company.

At some point the natural inclinations that got you to where you are today become a liability. Fred Wilson sums it up:

The skills that get you from idea, through initial product, past product market fit, and into a market leading company are very different from what it takes to manage a 200-500-1000 person global business that needs to execute well across a range of dimensions and keep everyone aligned, motivated, and working well together.

Leadership and Management is Hard

The point of understanding your personality isn’t necessarily to try to change who you are. It’s possible, but it’s extremely difficult. Personality, as psychologists define it, are tendencies that live inside you. People don’t see your personality, they experience how you behave…

And personality has a huge impact on behavior, which is why it can be so hard to transition into the kind of person that Fred Wilson describes.

Later on, we’ll talk about how to become more self-aware. We’ll also talk about how to use what you learn about yourself to find ways to counter-act the things you do (or don’t do) that get in the way of being a great startup CEO. For now, rest assured that you’re not alone in your struggles.


This is Part 2 of my ongoing series on the startup founders struggle with the transition to startup CEO (and what to do about it). In Part 1 we introduced the idea that for startup CEOs, it’s important to recognize that the transition is hard, but you need to focus on preparing for it ASAP. The next addition covers career preferences and how motivational anchors trip us up when it comes time to learn how to be a great startup CEO.

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