The CEO is the business guy. As a CEO, you don't get to code. Instead, you'll get to do the paperwork, answering phones, making cold calls, a lot of meetings, and a lot of traveling. It's fun at first, but gets boring quickly for technical people. You have to be comfortable with that role and must be a good communicator and marketer.
It's a fancy title, but don't let that tempt you against your good judgement. The founders of a lot of technology startups go out and hire an outsider to be the CEO. Google is a good example. Even Steve Jobs hired a CEO in the early days of Apple.
If you're in the very early days, then just put Founder as a title for all founders. You don't need to get into conflicts too early.
For us, giving the ceo title actually helps. I think even for startup you need that one guy who gives constant thought to the big picture. At the same time, you don't want your chief coder to be day dreaming too much about all the non-technical issues.
So having a ceo as the guy who brings together everything is a good way to establish responsibility and SOME structure in the startup.
I will say that while most ceos of big companies don't spend much time coding, for 2-3 person startups it is very common to find the ceo doing coding and/or designing IN ADDITION to business work.
Makes perfect sense for a 2-3 member startup, where all the founders wear multiple hats and structuring the different efforts seems like an important undertaking.
In my first company (founded 9 years ago) we were three founders and I was CEO. The decision was easy - the other two were better technologists, and I had better people skills.
In my new start-up the first thing I did was bring in a friend I trust, with business experience relevant to the venture (but no technology experience) as partner and CEO.
So, what gives?
It was fun holding the title back then, and I didn't do a bad job, but eventually I realized that the technology is more interesting for me, and as CEO you simply don't get to deal with that. Now that I'm a much better techie than I was back then, it was just obvious to me that I shouldn't be CEO.
Being CEO has its downsides like any other job. It means you are the one that shields everyone else from verbal beatings if customers are unhappy.
You're the guy that takes the heat if something is not going well. Especially at a small company, if someone is going to get chewed out by the customer, its going to be you. It often means you have to stay later and work harder than everyone else.
So. With power (the final say) comes alot of responsibility.
So who should it be? It probably depends alot on the business but lots of styles could work.
If you're in an early stage and seeking seed funding, then you should have everything thought out before talking to investors. Don't ask investors to help you decide which of the founders should be CEO because they'll take it as a sign that your partners and you can't work things out on your own. Investors want confident people who know what they're doing and go for it; they can smell fear and they'll disappear before you finish asking the question. Remember, it's YOUR company and it's YOUR responsibility. Investors help you with funding, introductions, and, maybe, some advice; but don't let them run your company for you. On the other hand, if you're in a later stage and seeking big VC funding then it's a whole different story. Talk to experienced entrepreneurs or close investors about the specific details of your situation; theyll give you great insight. Although the key princeples are the same: it's your responsibility and you're expected to have strong leadership.
It's a fancy title, but don't let that tempt you against your good judgement. The founders of a lot of technology startups go out and hire an outsider to be the CEO. Google is a good example. Even Steve Jobs hired a CEO in the early days of Apple.
If you're in the very early days, then just put Founder as a title for all founders. You don't need to get into conflicts too early.