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The Change of Plans Issue September 2021

There's no going back to normal

There's no going back to normal

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From creator to coach: Founders share lessons from the transition to CEO

Founder to CEO

While there’s no one right way to navigate the transition to CEO, there are lessons to be learned from other founders who have made the shift successfully.

    Amy Peterson, co-founder and CEO of Rebel Nell, has taken on almost all of the responsibilities in her company over the years — some more successfully than others (her years with Quickbooks were not a highlight, she joked).

    Having managed everything from production to accounting in the startup, she has worn all the hats. “I’ve always joked that my title should actually be ‘chief plate spinner,’” Amy said. 

    Now, seven years in, as Rebel Nell continues to grow, Amy is intentionally refocusing her time and energy. She has moved from handling a wide range of daily operational tasks and processes to setting strategies, strengthening culture, and promoting the mission inside and outside the business.

    In other words, she is doing the work that she is uniquely positioned to do — and responsible for — as the company’s CEO.

    As a first-time founder with a legal background rather than a business degree, Amy has been learning as she grows. Since launching her Detroit-based jewelry company — which provides employment, equitable opportunities, and support for women with barriers to employment — Amy has gone from a founder bringing an idea to life to a CEO scaling a small business into a nationally recognized brand.

    “Honestly, I’ve learned most of what I know by failing fast — learning hard lessons and adjusting as I go. It’s hard and not for the faint of heart, but it’s also really fulfilling,” she said.

    Amy’s experience transitioning into the role of CEO reflects that of many mission-driven founders who are building and scaling companies. It’s a significant milestone to shift from spinning all the plates to prioritizing the responsibilities and leadership qualities that will propel your company’s growth. Wrapping your head around what the role of CEO will require and look like day to day can be overwhelming.

    The good news is that many founders have navigated this transition before, and they have insights to share.

    So whether you have embraced the title of CEO from day one or you find yourself considering how to transition from founder to CEO effectively now, we’re here to share some notes to help you. We’ll help you understand the responsibilities, skills, and mindset of a founder versus those of a CEO so you can use your strengths and energy to grow your company and deliver on your mission.

    The why and when of the founder-to-CEO transition 

    Spoiler alert: There’s no prescribed time or trigger — in terms of revenue, headcount, or other key metrics — for a founder to make the transition to CEO. Leaders and companies have different priorities and grow at different rates.

    And if you’re looking to check a box in terms of your qualifications for the role before deciding if it’s the right time to make the leap, that can also be a moving target. While there’s consensus around some common leadership traits (drive, resilience, and risk, for example) among successful CEOs, that list also varies widely.

    It’s not a job you can really train for before your first rodeo. A McKinsey & Company article noted that the company’s long-time leader, Marvin Bower, considered the CEO’s job “so specialized that he felt executives could prepare for the post only by holding it” — a view that many CEOs share.

    But while there’s no definitive point in time or checklist of accomplishments to set a transition in motion, there’s a lot to learn from founders who have successfully made the shift.

    The mission-driven founders we spoke with shared a common experience: They recognized that at a certain point, a commitment to growth meant shifting from working in the business (managing processes and functions) to working on the business (strategy, culture, mission, and vision). The transition they describe is a shift in mindset as much as it is in responsibilities.

    You can think about the distinction between the two roles — to use sports terminology — as a change in position on the field. Moving from a founder mindset to a CEO mindset requires an intentional shift from the mindset of a creator, or individual player, to that of a leader or coach. As a coach (or CEO), you will direct, inspire, and empower a team of players, who will assume many of the responsibilities you may have owned to this point (as a founder).


    From founder to CEO: 5 tips from mission-driven leaders

    For specific advice on how to best navigate this transition, we sought out interviews with mission-driven founder/CEOs who revealed some common insights into the steps and strategies that contributed to their own successful shifts. Here's what they had to say:


    1. Know what you don’t know, then build a team to fill the knowledge gaps

    If you're going to make an effective transition from founder to CEO that will allow you to get out of the weeds and prioritize the big picture, you need the right team on the field.

    For Jennifer Harper, founder and CEO of Cheekbone Beauty, an Indigenous-owned and founded Canadian cosmetics company, committing to a first key hire set her transition in motion.

    “It's really important to be humble and understand what you're capable of doing and what you're not capable of doing and to make choices based on that to meet the business’ needs,” Jennifer said.

    “As a founder, I was passionate about the vision I had for Cheekbone from the beginning, but there came a point where I realized I couldn’t do everything well to see that vision become a reality,” she said.

    Recognizing that she needed to build a team to support the mission, Jennifer took the leap and hired a human resources lead. “I needed help finding the right people to fill the gaps,” she said. Bringing in that crucial expertise at the beginning set her up to build out the larger team, which quickly expanded to include finance, product development, and operations leads.

    Now, with leaders in place, Jennifer has been able to focus on her CEO role, developing long-term strategy and making the key decisions that drive growth.

    2. Build your management muscle by seeking out feedback

    If you feel overwhelmed thinking about learning all you need to know to take on the responsibilities of CEO, you’re not alone. Many founders who transition into the role don’t have management experience or leadership training.

    While that can feel like a roadblock, know that there are tons of great resources for information, training, and leadership development.

    “Remember to treat management skills as muscles you can build through experience and gut checks and good mentors and coaches,” said Lara Hogan, founder and coach at leadership training firm Wherewithall.

    One strategy Lara advises leaders: Tap into the existing knowledge base among your team, mentors, and wider network by requesting specific feedback on issues you’re working through.

    “You need people who can tell you where you need to grow, where your gaps are in skills or experience, and help you understand where to start and what to prioritize when it comes to growing in your role,” she said.

    It’s important to put an intentional focus on seeking out these conversations as you transition into the CEO role, Lara added, because it’s likely that people will feel less comfortable offering unsolicited feedback (especially to their CEO). Approaching people with genuine curiosity and actively listening to the insight they offer will go a long way toward building trust with your team and helping you develop as a leader.

    3. Leverage your time and delegate

    Transitioning from the role of individual contributor and builder to leader of a team means handing over responsibility — and trusting your players.

    “I think it can be tough for founders to relinquish control,” Amy at Rebel Nell said. “It was for me, at first.” But she also knows it’s important to focus on the things that she’s uniquely positioned to do as CEO if she wants to see the business continue to grow.

    For Amy, delegating has allowed her to step away from daily management of the business and prioritize the creative work of building networks and forging partnerships to grow the brand.

    While she acknowledged that she still gets brought into some operational issues as CEO, she’s removed herself from day-to-day management for the most part. “It allows me to focus on doing the things that are the highest and best use of my time — and the company’s time,” she said.


    4. Prioritize both mission and business goals

    For mission-driven founders, a transition to CEO means taking your mission on the road and integrating it into strategy and key decisions as you plan for the long term. But mission alone won’t propel growth, so keeping your eye on both prizes — mission and growth — is key.

    As co-founders and co-CEOs of auto-insurance startup Loop, which is using technology and data to offer consumers more equitably priced insurance, Carey Anne Nadeau and John Henry are each using their unique skills and strengths to drive mission and growth in parallel.

    “Mission has driven everything we do from day one,” Carey Anne said. “If that mission —  building trust in financial services — isn’t reflected in everything from messaging to how we treat customers to the culture within our team, we risk losing our way.”

    Carey Anne and John chose a co-CEO structure when they launched Loop because they knew that, specifically in their industry, it was important to prioritize technical expertise alongside marketing to build community around their mission and reach growth goals.

    “My background is in data science and statistics, and John understands how to build community, engage in the venture capital markets, and share the mission and value that we’re bringing to market,” Carey Anne said. “We knew we needed to be at the leading edge of both disciplines to be able to grow and reach people at scale.”

    5. Stay curious, reach out, and look inward to learn and grow

    All four founders we interviewed shared a commitment to learning about themselves and about the skills they needed to grow their businesses.

    “I like to surround myself with people who are smarter than I am and have been down this road before me. I ask a lot of questions,” Amy said of her work at Rebel Nell. “The amount of money I’ve spent taking people to coffee is insane,” she added, but personal connections and honest feedback have translated into growth for her business.

    Jennifer read over 100 books between the night in 2015 when she first dreamed of starting her sustainable beauty brand and the launch of Cheekbone Beauty in 2017. “I didn’t go to business school, and I didn’t know anything about entrepreneurship, so I just started reading and soaking up knowledge.”

    She continues to systematically plow through business books today, taking inspiration from other founders. “Reading as much as I have has helped me learn that there’s no one path, no one metric or solution to business success,” she said. “I learn something different and important from every book I read.”

    Loop’s co-founders have very different approaches to learning. “I gravitate toward practical, book-based learning, and John likes to jump in the ring and get bucked off the bull to learn the lesson,” Carey Anne said, “but both are effective and are central to our ethos as CEOs.”

    Seeking out professional coaching can also provide a powerful, objective perspective to shift mindset and learn in the founder-to-CEO transition. Lara at Wherewithall reflected: “Having an outside point of view — whether that means a leadership coach, a business coach, a therapist, a mentor, someone who doesn’t have a horse in the race in your company and can help you unpack whatever blockers you may have, understand where you need to grow, what kind of leader you want to be — can be invaluable.” 


    Take the field

    At the end of the day, the transition from founder to CEO — like so many aspects of building a business from scratch — will force you to learn and adapt. There’s no prescribed game plan, and any good coach knows that anything can happen on the field on any given day. But with an intentional desire to learn, genuine curiosity, and a focus on the mission that got you this far, you’ll be ready — with your team — to take the field.

    Written, recorded, and designed by doers & makers © 2021 In the Works