Startup general interest

The CEO’s job in a larger startup

By September 16, 2011 No Comments

Simple descriptions which capture the essence of complex concepts and objects are powerful tools for self analysis and monitoring. They work particularly well within teams of people because they are easy to remember and refer back to.

A long-time favourite of mine in the startup world is Patrick Dunne’s mantra that the role of the board is:

  • Right strategy,
  • Right resources, and
  • Stay out of jail (i.e. good governance, make filings etc)

I often refer back to that when boards start straying off piste, for example into operational matters.  (Boards sometimes need to involve themselves in operational matters, but the point is to make sure it is a short-lived involvement.)

A week or so back Seth Sternberg, CEO and co-Founder of Meebo, wrote a post on Techcrunch about the role of the CEO in a 200 person startup with a similarly powerful (and very similar) reduction.  He sees the job of the CEO as:

  • Strategy
  • People
  • Resource allocation

It makes sense that as companies get larger the CEO’s job starts to mirror that of the board, albeit without the governance piece.

The other interesting thing to note is that in sharp contrast to the startup stage there isn’t anything about rolling up the sleeves and getting involved, rather everything has been delegated.  As startups grow above 30-50 people CEOs and boards should be consciously thinking about evolving the job of the CEO to the one Seth describes.  If that is difficult, for example because there is too much firefighting to be done, then that should be regarded as a symptom of a deeper issue that needs fixing before the company can really scale.