This post is related to what I read over at AskTheVC regarding founders looking for a new CEO. I believe it’s not just about the founders looking for a new (non-founding) CEO but also if a CEO is what they want or a COO.

Over the last few years of my entrepreneurial journey, I had to come to terms with a simple fact. No matter what the resource constraints, a CEO and a COO’s (Chief Operating/Operations Officer) jobs are fundamentally different and usually require clear borders.

For example, I’ve broken down a sample startup that is bootstrapped and matures to get funded sometime in year 3.

Startup Qtr 01:
Everyone is an everything. The intern is the finance person, the founder is the receptionist, the founder’s spouse is the tech support person.

Startup Qtr’s 02-04:
Depending on the growth (or not) of the startup, the only few people who are a jack of all trades are the founders and the interns. The founders run the company (bosses) and the interns get coffee and answer the phone. Everyone else has atleast some structured job profile.

Startup Year 2 onwards:
This is where the lower order roles are more structured. The only people still doing a little bit of everything are the founders. If one of them is technically inclines, he/she is the CIO/chief developer. If one of them has domain experience, he/she is the Sales manager and marketing guru.

Still, the founders are doing a little bit of everything.
Now, suddenly, the company has two needs …
1) Someone who can look long-term, like a sports team manager. Who can decide who to bring in to fill different niches, etc. The same someone who has enough bandwidth to look for investment, plan on spending 3 to 6 months in meetings, on the road, giving presentations, using his network to find a friend of a friend of a friend of a cousin of a friend who happens to go to the same gym as a popular VC.
2) Someone who can think short-term, deal with day-to-day problems and detail out plans a week, a month or a qtr. in advance. A get-it-done person.

This is where the CEO and COO roles collide and need to be quickly and surgically split.

Very often, I’ve seen startups (having offices in an incubator helps) that cannot perform this sepration of roles correctly or at the right time.
What was their mistake? Is it that they didn’t see it coming and so are bad businessmen? Or were they just so busy keeping the business running and applying bandages all the time that they didn’t know when the need became an emergency.

So might be what many founders really want is a good COO, but are somehow confusing this with the role of a CEO.

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