Dear Founder: Here’s what to do when your board wants to replace you as CEO

By Maynard Webb

February 02, 2022

Q. My board is talking about replacing me as CEO. They asked me to be a part of the interview process. How to do I handle this?

-Founder and CEO of a growing company

Dear Founder, 

I understand this is hard. VCs used to routinely bring in more experienced CEOs to replace founder CEOs, but the good news is that this has changed in recent years. We’ve all found that it’s not necessarily experience that makes someone the best leader. There were times that I hired accomplished people who had done the job before, and it didn’t work out well. 

 
 

Typically, today’s boards don’t want to change out the CEO. They want to make it work with the founder, but one of the things that boards must worry about is succession—what if the unthinkable happens? Boards need to consider who will take over and detail a good succession plan for all sorts of scenarios. Is it possible that is what is going on here?

If you haven’t already, make the case for you to stay as CEO. Lead and execute so well that you quell the board’s appetite to take the risky step of replacing you with a new CEO. It is up to you to do such a great job that the board is not thinking about whether you are the person to lead the company. You need to do more than make them happy—they need to be delighted. 

Your very best move right now is to be a mature adult and stay above the fray. However frustrating this may be, always keep your professional demeanor. Make sure the board knows your point of view, but show wisdom and maturity and make your case with grace and dignity. I am not suggesting that you can’t be human and feel disappointed, angry, or frustrated, but save that for your family or friends or a therapist. It won’t help to have your raw emotions come out in front of everybody. 

I think it makes sense for you to be involved in the CEO search process from the beginning. Help with the interviews and help decide who is interviewed. 

When you meet the candidates, handle everything objectively and fairly. Talk about what you like and what can be improved on at the company. Paint a picture of where the company is and its future prospect in the best possible light. 

When you give the board feedback about the candidates, include what you like and what can be improved. Share with the board where you are with the candidate. Maybe you now see what everyone is talking about and are inspired to move to a new level. Or perhaps you remain uncertain, but will give the candidate the benefit of doubt. There also may be a scenario in which you feel you couldn’t stay if they joined. 

Taking a giant step back, another way to solve for this is to find a way around it. Go out and get enough money so the unhappy investors can’t push you out. Can you get enough votes to stay? Can you find new investors who love you and the company and can help you raise enough to buy out the current investors? If you have a firm grasp on where you are going, you are equipped to handle it, and you are convinced that you can do it, this is another option. 

 

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