Every business needs that ultimate leader and decision maker at the top, commonly given the title of Chief Executive Officer (CEO). Sometimes it’s the business founder, and in other cases the CEO is recruited by the founder or investors to complement the skills of the technical team. Everyone recognizes that even the best idea needs a great execution to assure success.
So what are the key attributes of the CEO you need? How does a startup founder know whether he or she has the skill and bandwidth to fill the role, or what and where to look for outside candidates? Of course, every business has unique requirements, so there is no candidate that fits all businesses, but in my experience there are a basic set of expectations which define the role:
Attract, incent, and manage great people. This role is quite different from the initial challenge of conceiving and developing an innovative product. Even the best founders soon find that they can’t physically do everything required to start and grow the business. Failure to move from the “do-er” role to a “manage” role kills many promising businesses.
Be the role model for effective leadership. Real leadership is much more than managing people and projects. Peter Drucker famously said, “Management is doing things right; leadership is doing the right things.” A good CEO must do both, while all the while providing a positive model to propagate these actions through all levels of the team.
Set the company culture and communicate goals and values. All team members look to the CEO as the model and driver for company culture, both internal and external. Everyone watches how employees are treated and decisions are made, and actions speak louder than words. Customers and investors listen for a consistent message.
Drive the financial strategy, including checks and balances. In the beginning, the CEO is the chief fund raiser, starting with setting the strategy for organic or leveraged growth. Beyond that, he or she must balance the constant demands for more resources from marketing, development, and support. Proper delegation to a CFO makes this work.
Negotiate and close key deals with partners and customers. A good CEO is always the top business development person, both strategically and tactically. They are expected to know the market and the marketing process, and build relationships with industry influencers, peer executives, community leaders, and even competitors.
Always forward thinking and planning for the future. The initial stages of every new business require a focus on tactics, but long-term success requires more strategic thinking, and the ability to “see around corners.” The best CEOs focus on where the market will be tomorrow, and are willing to change and take the risks to be there first.
No one is born with all these attributes, but they can be learned from experience in similar roles in other organizations or prior businesses. Every startup founder should start networking early with peers, advisors, and industry organizations to check their fit, and build relationships with other potential candidates.
These days, in addition to networking, you should also be exploring one of the online business matchmaking sites that have sprung up in the last few years, like FounderDating, or scour LinkedIn and funding sites like ProSeeder for candidates. Putting yourself on these sites may also be beneficial to your career down the road, not matter what happens.
Finally, executive recruiters are still a reliable alternative. Unfortunately, in my experience, many startups and small businesses really can’t afford this route, considering that the fee to find a qualified CEO may be in the $50,000 range.
In all cases, it takes more than a good resume and experience to make a good CEO for your company. The chemistry, culture, and values need to match yours, and be compatible with all the key members of your team. Just as in personal relationships, these things won’t all be evident in a first meeting. Take your time, and get to know the candidate outside of work before you commit.
So start developing and practicing these disciplines on the day you create your business, as they will serve you will, whether you decide to run the company for the long-term, or whether you plan to find that CEO of your dreams. Your investors will love you, your career will prosper, and the company’s chances for success will dramatically increase. It’s the win-win outcome we all want.
*** First published on Inc.com on 11/27/2016 ***