“Do you want to be CEO?” Is one of the key choices that all founders must face.

 

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Editor’s note: In the process of the continuous development and growth of startup companies, they will face the problem of who is the most suitable company CEO. In response to this question, which is the best choice for the product founder or externally hired professional managers to serve as the company’s CEO? This article, the original title is Bringing in an External CEO, the author is the general partner of the well-known venture capital firm A16Z Martin Casado, he combined his experience with everyone in this article to share with you the thinking about this issue, I hope it is useful to you. This is the first part of this series of articles, mainly introducing the confusion behind “Will you become CEO?” And related reference suggestions.

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“Would you like to be a CEO?” may be one of the difficult choices that most startup founders must face. For product founders, the question “Do you want to be CEO?” May be more complicated.

On the one hand, the product founders have gone through the entire process from product concept ideas to product launch, and they have walked through all kinds of difficulties and difficulties before product launch in blood, sweat and tears. Therefore, compared to anyone else, they are the people who know the most about technology, products and markets. From this perspective, the product founder should be the leader of the companyBased on the original vision, lead all employees to work towards the established goals together.

On the other hand, when the company’s development shifts from the product side to the sales side, and the operation scale is also expanded, it will inevitably require leaders to have different necessary skills. If a CEO is “airborne” from the outside to the company, the person with the CEO title can not only attract more outstanding talents, but also bring greater confidence to the company’s internal staff.

But the problem is that many founders may find that holding the role of CEO is not the best place to lead the company towards the established vision (for the company, this is also Not necessarily the best choice). At the same time, many founders and board members also believe that it is only by “airborne” a CEO from the outside that they can finally solve all the dilemmas and problems facing the company (however, their ideas are usually wrong).

So, for the founders, how should they face the question of “Do you want to be CEO?”

In this article, I will share with you my experience as a founder of a technology startup. Before I finally decided to be the CEO of the company, there were actually three other CEOs. Although the specific situation of each CEO is different when he is in office (this situation also exists in different types of companies in other industries), for all founders, whether the company ’s CEO should be served by the founder is absolutely A very important choice.

For this article, I hope it will be useful for at least all founders and help them solve important decision-making problems on the entrepreneurial path. The following content is mainly based on my personal experience, as well as some thoughts and suggestions for your reference.

Technical founder ’s confusion

I used to be the main founder of Nicira Networks technology company (now a company under the server virtualization market giant VMware). Nicira is mainly committed to the realization of software-defined networking Defined Networking (SDN) and network virtualization and other core areas.

Co-founded Nicira with me, as well as electrical engineering and computing at the University of California, BerkeleyScott Shenker, a professor in the Department of Mechanical Science, and Nick McKeown, a professor at Stanford University and one of the founders of the Open Networking Lab.

The reason why I am the main founder of Nicira is because I am the only founder of the company who has been on the job for a long time and is fully committed to the development of the company. For many start-up companies established outside the academic circle, academic consultants or founders will participate in the company’s management, but only a small number of people will be involved full-time, which is also a very common model and practice.

So, although Scott is the company ’s first CEO, he only plans to stay in the company for a year or two. On the other hand, Nick is a member of the board of directors, he does not need to participate in the company’s daily operations and management. And I have the largest shareholding in the company and I am also a member of the board of directors.

In addition, I am also the founding chief technology officer of the company. Looking back now, we have not had much discussion about these titles. I think, as everyone knows, when we start a company that is temporarily unknown, and there are important people in the academic circle among the partners, the internal title of the company is relatively less important.

Scott is a big man in the academic circle. He is one of the main pioneers in the field of SDN. He also has very rich leadership experience. But I did not care about these aspects at all. My concern at the time was that my job was to discover and build what kind of product, and then to build this product, and finally sell it.

During the company ’s development, team members and early investors have repeatedly asked me if I want to be the company ’s CEO. The first time this question was thrown before me, it was exactly when Scott was about to quit and return to academic circles. But to be honest, at that time, I was naive about becoming the CEO.

From observing the work of other CEOs, it is not difficult to find that the main work of the company ’s CEO is inseparable from finance, financing, law, contract, operation, salary and compensation, equipment and other content . As a result, I feel more that I may not have so much time to take up the post of CEO. The company needs me to focus on those core issues.

At that time, we just experienced the economic downturn of 2008. We were struggling with how to survive. We also faced huge difficulties in financing. In addition, we still have to find a match between the product and the market. More importantly, we want to acquire users.

The challenges faced by this series of problems are inseparable from the traditional architectures in the industry at the time. After all, the traditional network at the time did not really accept our software-defined network.

It was a “chess game” based on technology strategy. I also clearly realize that the outcome of this game is related to the survival of the company. As the founder of the company responsible for technology, I feel that this heavy responsibility falls on my shoulders.

Later, before finding a suitable full-time CEO candidate, we hired a temporary CEO to help the company through this transition period. Then, in less than a year, we hired Steve Mullaney, who had also served as interim CEO at Palo Alto Networks, the network security company, to serve as the company ’s CEO.

While working with Molani, we raised financing from institutions, found product market matching, and led the company to achieve scale development. At the same time, in only three years, we achieved record-breaking sales records. To be honest, this is extremely difficult.

After all the ups and downs, one of the most difficult choices before me and the team is the question of who should be the CEO of the company.

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Do you want to be CEO?

In the seventh year after the company was established, I finally decided to take over as the general manager of VMware (the company that acquired us at that time) (can be understood as the CEO of the company ’s large commercial department) One post, full responsibilityTake the company’s leadership responsibility and truly participate in the company’s all-round operation and management.

In the following three years, I led the company to successfully increase its revenue from US $ 160 million to US $ 600 million, and the company ’s total number of employees increased from 400 to thousands Scale.

Since then, I have been thinking about the problem of hiring a CEO from the outside, and I have also considered whether I will have different solutions.

As the only founder in the company who has been on the job for a long time and devoted himself to the development of the company, should I take the initiative to shoulder the CEO of the company when I first set up the company? Job?

I think that even if I did n’t do it, there was nothing. After all, Scott was initially appointed as CEO, and because of his influence in the academic circle and the Internet, it did indeed play a great role in recruiting talents, not to mention that he also helped us obtain some government subsidies.

However, for the company, the CEO ’s succession and transition is very difficult, and we have experienced two transitions. If I count myself, there are three times.

In view of my participation as the actual leader in several CEO successions and transitions within the company, you can say that I should have shouldered the burden of being the CEO of the company. However, because the company was still in the early stages of groping to find that the product was matching the market, and the overall business was also facing a huge challenge to migrate from the academic field to the real industry, so I think I may continue to serve as the chief technology officer (CTO) Better.

At least looking back now, these choices at that time were still relatively appropriate. Perhaps no matter what choices are made, there will always be corresponding solutions. But it is undeniable that the decision to hire an interim CEO from outside is quite wrong.

The background at the time was that Scott was preparing to return to the academic world, and my focus was only on the technology and product fields, and the main concern was how to make the company survive problem. In addition, the external environment at that time was also very bad. That was when the economic environment was the worst since the Great Depression.

However, nowWhen I looked back, I realized that I was actually avoiding responsibility. To be honest, in the difficult period we were in, we hired a temporary CEO from outside to lead the company. Especially in the context of this part-time job and no long-term commitment, it was originally “a road that can’t see the future.”

The interim CEO has also become a “person who has only been in the company for some time”, and he has no real absolute responsibility for all decisions. Therefore, it is very difficult to gain the trust of team members.

Of course, the former interim CEO of our company at least brought us some “guidance” values, but these values ​​can be obtained from other consultants, and they are not It will affect team morale and business.

What I should do is to take on the role of interim CEO, and then recruit the right talents to help me manage my daily operations. As a result, I also have time to continue to focus on finding the match between the product and the market.

In terms of the choices that the company has faced since its inception, the least regretful choice I have made is probably the decision to hire the CEO from outside.

We not only have a strong technology team, they pioneered the development of many core intellectual property rights that gradually promote the development of this industry, but also successfully sold products to those Traditional enterprises that are “following the rules” and have deep-rooted business relationships.

One of the important things that technical founders will always ignore, may be two important aspects of sales demand and market entry. If you don’t pay attention to these two aspects, then you can’t have real users, let alone business.

Frankly speaking, as far as the situation at the time was concerned, we had no internal means and no suitable person to solve this problem. Therefore, in almost a year, we followed dozens of candidates (including the founder of A16Z, well-known investor Ben Horowit), but he rejected our invitation, But agreed to invest in us) The ditch passed, and we finally hired Steve.

Steve has more than 20 years of experience in this industry, so he can use his network resources to quickly set up a managementManagement team. He brings the company’s senior experience in going to market and also makes up for the leadership we just lacked. In addition, he also played a key role in the market and after-sales strategy formulation.

Although Steve just accepted the management of the company, the company ’s “technical taste” is particularly strong, and since the establishment of the user has also received many experiences and lessons, but in the end It does n’t matter how strong the technology team is, or how whimsy an idea is. It is important that users will use and purchase this product.

At that time, Steve was not only the most suitable person to serve as CEO, but more importantly, he completely trusted the entire founding team and technical team. He entered the company to help and promote the company’s growth, not to launch a “game of power”.

He is also one of the team members, which is more important to me who has been in the company since the company was founded. Whether it is financing, talent recruitment, sales, or board management, and company strategy, Steve and I basically work together. Without him, the company’s current development may be very different.