Entrepreneurs and founders have a unique knack for bringing ideas to life, but sometimes those skills can hold back a growing young company, as Ian explores in this article.
Founders are usually pathfinders, visionaries, and risk-takers, with the energy and passion that differentiate them from the herd as they turn their ideas into real things, driven by a conviction that they can beat the odds.
However, that vision, passion, optimism, and decisiveness often naturally result in building a centralised, slightly autocratic organization, with the founder deeply identified with the business.
Industry observers and investors have coined a new term for this, “founder syndrome”, to describe the point when the founder's skills and talents that brought the company success are working against continued growth and scale.
The bottleneck
In an article for Raconteur magazine, serial entrepreneur Pat Lynes shared his experience:
“I’ve seen so many CEOs let their own ego get the best of them and end up becoming part of the problem. They end up holding their business back ... I never wanted that for myself.”
And of course, as an organization grows beyond a successful startup, this type of organizational structure creates a bottleneck that impedes growth.
This bottleneck is not just about how decisions are made, or even what decisions are made; there’s often a more fundamental challenge of time.
As the founder's time is now taken up with working in the business rather than on it, the innovative ideas and relationships that led to market-share gains have slowed, as they are now running deals, operations, and HR, spending a great deal of their time on tasks that don’t play to their strengths.
When success becomes the problem
Overcoming this inflection point for any ambitious business is critical.
Founder hero sellers, with loose positioning, “finger in the air” pricing, and ad-hoc campaigns, can muscle their way to early-stage revenue, but beyond that, scaling the business requires the discipline to address “founder syndrome”.
The symptoms are usually clear, even if they're uncomfortable to admit. The founder is in every deal, every hire, and every client escalation. The pipeline stalls when they're unavailable, and it’s hard to make strategic decisions as everyone is firefighting. If any of this sounds familiar, the inflection point isn't coming; this is founder syndrome, and it's already here
Yes, many companies are happy to plateau comfortably with a founder at the helm and a small team, but, in our experience, those looking for Series B funding and beyond, investors are underwriting future growth, not past performance.
Investors are looking for a credible GTM model and a leadership team capable of scaling and not exposed to a single point of failure (like the founder, who is critical to every part of the business operations).
The obvious answer at this point is to hire or to get external support, but this is also where founder syndrome can strike.
Getting help feels hard
For an entrepreneurial founder with the instincts that got them here, hiring feels like a dilution of ownership, a loss of control, or asking someone else to raise their child.
Asking for advice can feel like a signal of uncertainty, especially in the tough environment of investor meetings and the board. It can present a perceived threat to that clarity of vision, or be dismissed, as their success bias leads them to believe that what got them here will get them there.
And when it comes to hiring for the skills that would amplify what the founder has built, particularly in sales and marketing, it's unfamiliar territory. They know what they've achieved, but it's hard to know what 'great' looks like in someone else.
A smarter way to scale
In today’s talent market, founders are not restricted to the old process of deciding what level of hire they need, running a lengthy selection process, and crossing their fingers that all the time and money invested in a full-time hire will be a great fit.
There are more flexible options, which can preserve a start-up's agility without that overhead.
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Non-Executive Directors, especially those with experience in the kind of business this aspires to be, can quickly serve as a strategic sounding board, particularly on business growth, financing, operations, and investment.
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Fractional sales and marketing leaders can quickly diagnose demand-generation and pipeline bottlenecks and instantly take up the execution load, freeing up founders' time, without a long-term commitment or equity stake.
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External expertise can help a founder figure out the next steps for the leadership team, the skills and execution gaps, and what a good CEO, CRO, or CMO that would complement a founding team’s skills, style, and approach would look like.
The syndrome is a signal of success (and risk)
Founders don’t need help because they’re failing. They need help because they’re succeeding, but what made them successful won’t scale.
Overcoming “founder syndrome” is key to that.
