Why is it acceptable for the Founder/CEO to continue leading the company at 40+ employees but not acceptable for the engineer to lead an engineering team at 40+ employees? Seems like a double standard.
> Why is it acceptable for the Founder/CEO to continue leading the company at 40+ employees but not acceptable for the engineer to lead an engineering team at 40+ employees? Seems like a double standard.
It is a double standard, but however it's hardly that cut and dry.
Post Series B, if the board does not believe the current Founder/CEO can take the company to the next milestones of growth, they will replace them.
Typically engineering teams need to scale sooner, so you you see a more experienced manager be brought in before the CEO is considered for replacing.
The CEO may also has the additional benefit of having the investors and board help him or her in their decisions.
reason number 472 to never take funding.. if your business can not be bootstrapped successfully, it's likely your business is going to never turn a profit. Funding is silly, i'd never subject any business i'm involved with to a board room full of investors that don't give a shit about me or my business and only care about PROFIT! MOAR PROFIT! blech.
So glad we're bootstrapped.. we're not doing millions a month in business, but we don't need to.. we've been profitable for nearly a decade, a SaaS service since 2002, and we do about 100k/mo in revenue. Pays the bills, pays our people, and we're all so much happier with life.
>if your business can not be bootstrapped successfully, it's likely your business is going to never turn a profit. Funding is silly...
Well, this just isn't true at all. Many companies have very high costs up front due to the nature of their business. This is especially true in hardware startups, but can also be true in software startups.
I guess, but there are so many better ways these days, if your product is worth building to get it built than to give up a huge piece of your pie. Crowd funding, etc.. if you have 10 years of R&D well you're better off just taking the idea to another company.
This is a generalization, but I think owners get their priorites mixed up when they are sitting on millions in free money.. their burn rate is insane.. they spend money on the wrong things, etc.. fancy offices, whatever, and they aren't even profitable. We work from home, and share a co-working space as well as an office with 2 other companies..
Office life is over rated and is a giant waste of startup funds. =/
The board is just a bunch of old white dudes with money. The fuck do they know?
EDIT:
balls187 suggests they know how to make money--which is perhaps true, but not necessarily in your field of endeavor or business, unless you've picked them.
kelnos is closer to it, which is that the board tells you what to do because they're the board and that's the power you've granted them.
Again, in neither case, do we actually need to assume they are making the best or even informed decisions. There are some great stories of boards I've known locally suggesting really dumb things that hurt and even killed companies.
Assuming you're correct (very debatable), it doesn't matter: they're the ones funding the company, so they get to make the decisions. This doesn't always work out well, but it's not unreasonable.
One BIG reason to start your own company but never ever become an employee at a startup.
EDIT: The only benefit of working at startup (and a significant one) is to learn how startups work. If thats taken away from you then there is no point in risking your career.
Frequently in VC backed companies, founders are removed from the CEO role if they aren't showing the ability to monetize and determine "what's next." Sometimes the founder goes to a glorified secondary tech role like a fellow, and sometimes they leave the company all together.
We are doing it differently. We don't think a tech driven business can be run by non tech leadership. We also don't think it can be run without business leadership. So we have two CEOs, on from tech and one from the business sector we are in. It works really well.
The two are not equivalent, as you need different attributes in each case. The CEO needs to have the product vision and complete information about the company (see http://www.bhorowitz.com/why_we_prefer_founding_ceos for discussion), which typically only the founding CEO can have. You'll note that this is a continuation of the role they had when the company was small, though of course it requires a massive amount of learning.
However, for all other roles in the company, the important thing is having the experience to scale and lead that part of the company: sales, marketing, product, support, engineering. When the company is young, those roles will be filled by allrounders: people a few years experience who do everything in that area. As the company grows, you'll want to hire VPs who have the skills to lead those areas, often people with >15 years experience as a practitioner and/or leader in those areas.
It's not just engineering: you want a VP of Sales, a VP of marketing, a VP of product, etc. Those people will have the skills to take your existing sales/marketing/product/engineering org, and scale it without damaging it. If you have that skillset in your engineer #2, than it would make sense for them to do that role, but it's unlikely that they do, and certainly doesn't seem like it in th OP's case.
I understand, but you are right it's a double standard. The Founder/CEO usually got that position for reasons other than
their their technical know how. Personally, If a CEO doesn't
understand most of the nuts and bolts of the company they are running; bye! bye!(That is unless they are brilliant in other areas in business.)
It is a double standard, but however it's hardly that cut and dry.
Post Series B, if the board does not believe the current Founder/CEO can take the company to the next milestones of growth, they will replace them.
Typically engineering teams need to scale sooner, so you you see a more experienced manager be brought in before the CEO is considered for replacing.
The CEO may also has the additional benefit of having the investors and board help him or her in their decisions.