Chapter 15: How to transition gracefully from founder to CEO -
Tomorrow Toolkit for Entrepreneurs
How to transition gracefully from founder to CEO By Tajha Chappellet-Lanier
Yes, you’re #blessed that your company is growing. But transitioning from doer to enabler can be tough.

“Nowadays, the main value that I can provide for the company is hiring really great people.”

This is how Zvi Band, cofounder and CEO of Contactually, describes his job. But this hasn’t always been his role — “When I was starting the company, I was writing half of the software code,” he said. “I was one of the cofounders, I was writing the code, I set up the website, I was building everything, doing all of this work.”

As Contactually — a relationship-tracking software service — began to grow and the company hired engineers to work with Band, more engineers were hired to work for him. “All of the sudden I’m now managing a VP of engineering,” Band said.

Now, in contrast to the early stages, he also spends a lot of time thinking about things like long-term goals and “company culture.”

This is very good news from a company perspective — it means that Contactually is now out of the “initial startup phase,” as Band put it, and into the growth phase. However, from a personal perspective, it means that Band’s job description has changed in a major way since he and two partners founded a company looking to transform the way businesses stay in touch with clients in 2011.

This is a challenging shift for a lot of founder/CEOs because founders, often doers by nature, face the task of learning to be enablers once they take on a CEO role.

“I guess it’s like being a parent,” Joel Holland, founder and CEO of VideoBlocks, said. Whereas once you found yourself taking care of every piece of the company, now it’s all (or getting to be all) grown up.

So how should you navigate this transition?

Hiring is not only about adding people to handle the increased workload, but also the role in the company’s success that initially fell on the founder’s shoulders. Adding accountability is also important, said Star Cunningham of Chicago-based 4D Healthware.

“You have to enable them to be empowered, to make decisions, and to contribute to the company as a whole,” she said. “And don’t ever forget, if for some reason a member of your team is not performing, it is your responsibility to assure that you’re taking the time to communicate effectively, to help them to be the best employee they can be.”

Band returns to the idea of hiring good people, then setting up clear frameworks for feedback. “Now we’re 60 employees — I still make sure that I have quarterly one-on-one check-ins with every individual employee,” he said. “I might not know what they’re doing day-to-day basis, but on a quarterly basis I want to check in with them.”

It’s also important to articulate a very specific set of metrics for what success and/or failure look like in different parts of the company. Holland feels strongly about this step. Learning not to micromanage can be a challenge, he said. But when every member of the company has clear goals for their role, a CEO can comfortably take a step back — at least until the next check-in.

Other tips Band has for the founder to CEO transition center on defining the employee-CEO relationship — something unnecessary back when you are your company’s only employee. Band said he’s found it helpful to distinguish between an opinion, a strong suggestion and a mandate, and make sure his employees recognize this difference too. This allows Band to give opinions without entering into the territory of micromanaging.

In the end, though, making a graceful founder to CEO transition depends on willingness to grow personally, and as a leader.

Make no mistake that there is a challenge involved. “The biggest part of it is just letting go,” said Margaret Martin. The CEO of Atlanta augmented reality company CN2 noticed a change when her own responses to people asking questions changed.

Instead of answering questions, she said, “I’m sorry, you’re going to have to figure this out on your own. I trust you. I think you’ve got great judgment. I think you’re a really talented individual. You wouldn’t be part of the organization if I didn’t trust your decision-making.”

Jay Marwaha, president and CEO of Syntasa, said at some point many companies will need a professional CEO, and that’s OK. A founder might not want to make this shift in job description and lifestyle.

But assuming you do, you’ve got to be humble and continue learning. “The leader you are now might be very different than the leader your company needs you to be, or will need you to be in the future,” Band said. “If you want to continue to be that person, you have to be always leveling up your skills.”

Just because you founded your company doesn't mean you'll always be the best one to lead it, says Jay Marwaha, the president and CEO of Syntasa.

Your Checklist:

  • Make sure there are clear mechanisms for feedback. As your company grows, you won’t be able to talk with every employee every day. Make sure you stay in touch with what’s going on at lower levels and that your employees know how to get in touch with you by setting up a regular and recurring structure for feedback.
  • Know what success looks like. Know what failure looks like too, and make sure every employee is clear on what success and failure look like for their role. This gives employees agency, and will enable you as CEO to step back and not micromanage.
  • Define the CEO-employee relationship. Be conscious about how the power dynamic informs your interaction with employees. Be careful to define when you’re giving a mandate versus a simple opinion, otherwise you could be micromanaging without meaning to. Look for opportunities to give employees ownership of the problem that the company is solving.
  • Be humble and continue learning. You’ll go through a lot of personal growth as you make this transition, and you’ll need to always learn new skills. Be motivated to learn. Prepare to let go of some of the responsibilities that were so important to forming the company, and instead focus on transferring the passion behind that work to the rest of the team. Not interested in making this transition? There’s always the option of hiring a professional CEO.

The point is that there is a distinct set of responsibilities between a founder and CEO. They are different roles, that require different skills. Be mindful of making that transition.

Sign-up for daily news updates from

Do NOT follow this link or you will be banned from the site!