Every founder eventually reaches a point where the skills that built the business are no longer the skills the business needs next. That’s not failure; it’s evidence of success, as Ian explores.
Founders are 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.
I love working for these people; however, we need to recognise that the vision, passion, optimism, and decisiveness often naturally result in building a centralized organization, with the founder deeply identified with the business.
But there comes a point when the skills that built the business aren’t the same ones needed to scale it.
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 can create 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, quite understandably, increasingly spent running the business rather than building 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.
Overcoming this inflection point for any ambitious business is critical.
Most of us who have worked with founder-led businesses have seen it. The founder can out-sell everyone, make decisions in minutes, and keep the whole company moving. Those are superpowers until the business reaches the point where everyone is waiting for that one person.
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.
Yes, some companies are happy to plateau comfortably with a founder at the helm and a small team, but, in our experience, for 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 (such as the founder, who is critical to every part of the business).
The obvious answer at this point is to hire or to get external support.
Except that’s often much easier to say than to do.
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.
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.
Great founders don’t build businesses that depend on them. They build businesses that can outgrow them. The transition is uncomfortable because it means letting go of the very habits that made them successful.
But that’s what scaling looks like.
Great founders don’t become less important as their businesses grow. They become important in different ways.
Need help making that transition? We’d love to help.