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i have the idea for this events based website but how do i know if i need to hire a CEO or if i can be one.

1: i am not that social but i can communicate clearly on the topics of my interests/ideas. 2: i have never managed people but i know i tend to be a micromanager

what are the qualities/skills required for one to be a CEO.

this will help me focus myself to be complete technical guy or hone my management skills to execute my idea myself and not think about hiring a CEO.

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i have done the market validation/research, built a business plan etc and ready to pitch to investors, the reason i am asking this question is when will VC's bring in an external CEO, i mean what will they see and evaluate me and decide to take that decision. i dont have any problem in that but external CEO might drastically change the whole strategy. – Syed Dec 18 '09 at 22:32

9 Answers

up vote 15 down vote accepted

Having been a CEO of several small tech companies in Silicon Valley, here is a summary of what I've found the job to be:

  1. A CEO's #1 job is to empower his/her team to do the job that needs to be done. It is the CEO's job to put energy into the business.
  2. A CEO is responsible for drawing out, synthesizing, and articulating the vision for the company both internal and external. This is not necessarily the same thing as creating the vision.
  3. A CEO is responsible for creating a culture that is high integrity, high performance, but humane. Balancing these three is tougher than it looks.
  4. When it comes to raising money, key customers and key partners, the CEO is the top salesperson and representative of the company. By virtue of your position, especially to investors, you are the face of the company.
  5. A CEO is responsible for ensuring the company has a coherent strategy for winning in the marketplace and that the company is executing. At the startup level that means ensuring that the company creates a business model that works and understands how to acquire customers.

So what skills does it take?

  1. You should be able to pick people. Get this right, and a lot of issues go away.
  2. You need to be an effective communicator of your ideas.
  3. You need to be able to empathize with people and be able to put yourself in their shoes.
  4. You need to have the guts to stick with your ethical values (just look around to see what happens when CEOs don't have this).
  5. You need to have the ability to face the facts as they are, not as you wish them to be.

What you don't need:

  1. Brilliance - you don't need to know everything or be the most knowledgeable person in the room. In fact, that can actually be a handicap.
  2. Charisma - I know a lot of plain vanilla, even dull CEOs who are nevertheless very effective. We can't all be Steve Jobs. CEOs come in many flavors.
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+1 This is an incredible description of what it takes to be a CEO in a growing and maturing company. This may be the best answer I've seen to any question on this site. Outstanding. – Michael Trafton Dec 20 '09 at 2:30
Being a somewhat non-typical CEO I was ready to read this and argue with the normal stereotype but I really have to say I 100% agree with all of this. Very well stated. – Dane Dec 20 '09 at 5:37
How do I vote for this answer twice? - Well done! – Tall Jeff Dec 21 '09 at 1:10
very interesting, i'd be interested to know how possibly it could be a handicap to be brilliant/most knowledgable person in the room. – Syed Dec 21 '09 at 3:23
Syed, brilliance can be a handicap if it stifles the willingness of your people to present views that might be contrary to yours. I've found that people spend a lot of time trying to "read the CEO". You may have to create a safe environment for people to put forth their true opinions even to the point of playing dumb. – edwinoh Dec 22 '09 at 23:33
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up vote 3 down vote

Problem #1: You believing "being CEO" is some magical thing which requires special skills you don't possess. That's a compliment, BTW! :-)

There are many kinds of successful CEOs, once a company is going:

  1. Sales-oriented: Moves product out the door
  2. Tech-oriented: Unites market need with tech feasibility
  3. Money-raising: Keeps the doors open by raising money
  4. Famous: Gets attention because they themselves are famous; they just need to be themselves.
  5. Accounting/Finance
  6. Operations

Of course these are also things traditionally thought of as CTO, COO, CFO, ... but usually the CEO "naturally leans" one way or another.

I've seen companies with all sorts of leaders, both successful and unsuccessful. Point being: there's no formula or correct set of skills.

Result: Like others here have said, your job right now is to match product to market need, without putting a label on it.

After revenue appears, there's plenty of time to figure out what kind of leader you are, and plug your weaknesses with others you trust to help out.

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up vote 2 down vote

If you are at an idea stage, then your biggest problem is not whether you'd make a good CEO or not, but creating a demo / product so you can start getting users / customers. If you have enough technical skills to build it, I'd say that's #1.

In general, I'd say #1 skill of co-founder CEO is ability to sell, whatever that may mean for your business. Also, since you'll be focused on technical work, your CEO can do a lot of other things, like talking to potential clients, evaluating product / market fit, etc.

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i want to evaluate product/market fit and then get into coding/technical work – Syed Dec 18 '09 at 19:46
Fair Enough. Then you probably have all you need to start validating it. Just go out there and start talking to people. If this is your baby - don't outsource all of it - talking to people will help you hone the idea. – Jean Barmash Dec 18 '09 at 20:17
+1 on all this. – Jason Dec 19 '09 at 0:24
up vote 2 down vote
  1. Passion for your product
  2. Do what your good at
  3. Hire other people to do what your not.
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up vote 2 down vote

Syed, the most important step towards launching any product is market validation. You need to talk to potential customers of your products. To as many as possible. Entrepreneurs who miss that step and end up building products that miss the mark.

Depending on what the product is, if you are not a domain expert in that field, then you should surround yourself with people who are experts. This could mean hiring an expert in that field as an executive.

In a startup environment, particularly if you are bootstrapping, there are no clear role demarkations. You need people who are willing to roll up their sleeves and get stuff done. Sometimes it is talking to customers, pitching to potential investors, brain storming on marketing strategy, or even testing the code.

Instead, if you are a VC funded company, then the VCs may force you to bring in an external CEO if they think you are not experienced enough.

Your question is too hard to answer without knowing the specifics of your situation.

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i have done the market validation/research, built a business plan etc and ready to pitch to investors, the reason i am asking this question is when will VC's bring in an external CEO, i mean what will they see and evaluate me and decide to take that decision. i dont have any problem in that but external CEO might drastically change the whole strategy. – Syed Dec 18 '09 at 22:09
Do you have enough expertise in the industry? Do you have strong relationships within the ecosystem (with vendors / customers / partners)? What kind of projects have you lead before? Why do you say external CEO will "drastically change" the strategy? If your business plan is strong, why would a CEO disregard it and pursue a different strategy? The VCs will do whatever is best for the company / their investment. If you can convince them that you are the best to lead the company, then they will make you the CEO. There are no strict rules for any of this, all depends on the specific context. – Jagath Narayan - Ordoro Dec 18 '09 at 22:51
up vote 1 down vote

I agree with the above answer. Just worry about being the technical guy for the demo/alpha and then worry about the CEO role. My biggest qualification for a CEO is the ability to present (investor presentations, sales) and to make decisions with the team. Also, the business-know how. A lot of people claim that business people are useless in Tech companies but I don't agree fully. I see the point, but some business sense helps.

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up vote 1 down vote

You really do need to find a CEO type on your own. That will be the best thing for you. VC's want a team and having a solid CEO and Technical Guy (You) will be better than you going by yourself.

In terms of characteristics of a good CEO, my list is:

  • Raised VC Money before (which means been at a startup before)
  • Understands the technology
  • Understands the market
  • Knows their limitations
  • Surrounds themselves with people smarter than themselves
  • Is honest, straightforward and does not BS.
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up vote 1 down vote

I'm writing a series on my blog on exactly this topic. I've published the first 6 out of 11 traits and the other 5 are written but will be published early in January. The first 6 are below. If you click on this link Entrepreneur DNA it takes you to a page where you can click through and read each article in full:

  1. Tenacity – the most important attribute of an entrepreneur is never being willing to give up.

  2. Street Smarts – getting out and understanding customers is far more important than book smarts or computer research.

  3. Ability to Pivot – it’s not good enough to be tenacious and smart. You also need to be sure you have a great product/market fit and that it is a big enough market to make money. The best entrepreneurs fine tune their product and their business model until they find this groove.

  4. Resiliency – being an entrepreneur is sexy … for those who haven’t done it. In reality it’s gritty, tough work where you will be filled with self doubt. Entrepreneurs are survivors.

  5. Inspiration - Tenacity + street smarts is not enough without inspiration. You need to lead teams and convince others to move mountains when by all means they shouldn’t believe they can.

  6. Perspiration - We all know people who can stand up at a conference and deliver a rousing speech or who sound awesome in front of customers. But it takes more than inspiration to build a successful business. It takes perspiration also.

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up vote 0 down vote

Syed,

Are you kidding? At your stage of business development you get to be the CEO by default. Oh, and the Director of Maintenance Services as well. Would you like to know what it takes to be a good custodian too?

Just kidding and having some fun.

Read the E-Myth Revisited, by Michael Gerber and strap yourself in for an adventurous and breathtaking ride. Enjoy the journey.

Good Luck, Tommy Jaye

P.S. Great post Edwinoh!

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