
What’s the Second Job of a Startup CEO? - craigcannon
https://blog.ycombinator.com/the-second-job-of-a-startup-ceo/
======
neom
Spot on, and it's really really hard. I had the privilege of working for a CEO
who scaled his business from < 20 people when I joined to ~300 when I left.
You really feel each of these stages and it's very difficult to ride the
transitions through them, especially if you've done a good job in phase one
and you have strong product fit with your market, the business kinda just gets
sucked along for a while and it's hard to "feel" the break points if you will.
There is a transition from the tactical CEO to the thoughtful CEO that is hard
to describe and seems hard for many of the CEOs I coach to execute. Not
transitioning quickly enough through these stages and steps, and remembering
to somewhat modulate your message regarding the vision mission and purpose
stuff results in very uncomfortable periods of time, _especially_
uncomfortable if your company has caught up to your thought. I do think CEO at
scale is an incredibly difficult job.

~~~
hkmurakami
Coincidentally, I think the 300 number is another transition point. Until 300,
you can be a CEO who really holds the wheel on many aspects of the company.
Beyond this, you really have to be comfortable with delegating to your
lieutenants, and empower rather than control.

The CEO at my previous employer successfully took 3 companies to exit, each at
around the 300 mark. Terrific starter and operator capable of making really
tough calls (like saying no to ominous AAPL supplier terms despite the obvious
upsides), but quite bad at delegating.

Still wondering many years later if there are any predictors for someone who
can make this transition.

~~~
danieltillett
I am not sure that it is best to be able to make this transition or not. We
all have our strengths and weaknesses.

~~~
hkmurakami
Agreed. Can't dispute his track record!

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GCA10
I wish this piece had spent more time on the art of "Making Sure They Work
Well Together." This is huge -- and underappreciated by 95% of founders. Here
are four dimensions that would be worth exploring in a subsequent post:

Who does what? What happens when we disagree? What are the ground rules for
revisiting a decision? Do we understand one another's approach to time
management, prioritizing, delivery targets, conflict resolution, etc.

Members of the early-stage leadership team aren't clones. There will be
differences. Can we calibrate smoothly, or will we forever need to "talk it
out"? When there's a lot of churn in the founding team, usually it's because
one of these four issues isn't being handled well. In severe cases, cycling
new people into the job just starts the fail loop afresh -- no matter how
amazing each new candidate might be.

~~~
neom
Here are some great books for that:

[https://www.amazon.com/Art-Facilitation-Essentials-
Meetings-...](https://www.amazon.com/Art-Facilitation-Essentials-Meetings-
Creating/dp/145965739X) [https://www.amazon.com/Creativity-Inc-Overcoming-
Unseen-Insp...](https://www.amazon.com/Creativity-Inc-Overcoming-Unseen-
Inspiration/dp/0812993012) [https://www.amazon.com/Five-Dysfunctions-Team-
Leadership-Fab...](https://www.amazon.com/Five-Dysfunctions-Team-Leadership-
Fable/dp/0787960756) [https://www.amazon.com/Overcoming-Five-Dysfunctions-
Team-Fac...](https://www.amazon.com/Overcoming-Five-Dysfunctions-Team-
Facilitators/dp/0787976377) [https://www.amazon.com/Communication-featured-
Necessary-Pers...](https://www.amazon.com/Communication-featured-Necessary-
Persuasion-Conger/dp/1422189864)

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sskates
This took me a year to really internalize- I wish I had read this a while back
when we were 20 people. It wasn't until we passed 45 that I really took a
thorough look at how I was spending my time. I intellectually understood the
transition to delegation and leverage but a lot of the rest of the company
didn't and it caused me to take longer than I should have to refocus on
recruiting an exec team and defining the company strategy. Excellent writeup.

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simonw
This essay is absolutely fantastic - one of the best pieces of writing I've
ever read on growing a company. The description of the phase one/two/three CEO
Model makes a ton of sense, and the examples given (SpaceX mission, Pixar
culture) were enlightening.

I have just one criticism: I think the headline under-sells the rest of the
essay. I see this more as the YC guide to growing your startup beyond phase
one.

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bastian
I took me a while to figure this out but i agree with Ali. However, i'd argue
that as a CEO with a product background (the same probably goes for
engineering) you can still spend time with your product teams through Phase 2
and maybe even in Phase 3. It is just a slightly different role, a more
guiding function.

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hardtke
The second thing a CEO should focus on is building a repeatable sales model.
Some products "sell themselves" but most products need a lot of
experimentation with the sales model until they become profitable.

~~~
vinceguidry
That's arguably part of building the product. But I agree that it's very
important and is one thing a lot of engineer-founders miss.

~~~
valarauca1
One could say it is impossible to _ship a product to market_. If you don't
know where that market is.

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vsloo
The second job of a startup CEO is actually everything outside of building a
product. Everything from hiring the right team, to making sure people are
happy, to finding sales/distribution channels, marketing channels. It's not a
question of what else the CEO should be doing but a question more of how long
he/she should be doing those things.

~~~
thinkingkong
Its their job to do those things by building the right team to do it too.

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davidu
My three priorities when I was a CEO: Team, Vision, Cash.

Easier said than done.

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greenspot
> Doer-in-Chief. You must be deeply involved in both building the product
> (observing/interacting with users, writing code, designing product specs)

I slightly disagree here, I would rather start with the Second Job or Phase 2,
'Hiring a Leadership Team and Making Sure They Work Well Together'. The more
you focus on finding and setting up the best team early on the better. You can
do yourself a prototype, write code or do market research to see if you are on
the right track. However, I recommend to setup the founding or leadership team
before anything else. Once you have the team in place the project gets
momentum and pace will be 100x compared to before. And finding the team plus
setting up all legal matters will be a full-time job your first weeks if not
months.

~~~
sgarman
How do you pay all those people?

~~~
greenspot
Good question and this will be the biggest challenge. The answer is equity.
But be careful before giving too much equity too easy away. You should have a
big pipeline of candidates and know exactly what you expect from whom and how
much you are willing to give away and on what conditions. At the beginning
some might join your venture full-time, some not. Latter ones are easy to get
but eventually it might be hard to get them out of the current jobs if the
prospects are not to positive or let's say the first round is rather small.

Once in later funding stages (A, B) you have much better financial power and
thus, you'll update or upgrade your senior management team anyway.

~~~
Lordarminius
> The answer is equity

How realistic is it to bet your company on people working for equity? In its
early days most rational people will not join a startup for equity alone. A
few will join for cash and comp; for most,cash alone is good enough.

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koga-ninja
The stereotypical image of the CEO is that they are Backslappers and they play
golf.

Not so in Silicon Valley I suppose.

The main factor I see for CEOs in a startup is Time horizon. If you want to be
around for thirty Years, have fun, and incidentally build a useful Product -
you will do things differently.

The Steve Jobs/ Sun Tzu type of anecdote is the best. If you spend 50 percent
of your time on strategy or Thinking, it is for the best.

A final point is that keeping a good attitude is Important, not just for you
but also for your team. This is often underestimated.

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kriro
I'm not so sure about the implicit assumption that growth/phase change should
be measured by head count. Sure you need some estimate but I do find the
stage3 = 400 employees a bit strange. Especially given WhatsApp happened.

I would have preferred if the article used some other measures to indicate the
state changes (profit, net promoter whatever) or at least discussed this a bit
more.

That being said it's a pretty good article. I think it makes the
product/market fit -> company building shift pretty clear.

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untilHellbanned
Why did YCombinator blog switch to Wordpress from their own "free forever"
Posthaven solution?

Their new site feels tacky and generic kinda like this blog post. Taken
together with less news on larger batches of startups in recent years, it
feels symptomatic of a slow dilution/degration of the YC brand.

~~~
vintageseltzer
I don't have first-hand experience, but I would guess it would be the same
reason most people do: (1) when you roll your own CMS, you have to build all
of the features your editors and designers request yourself, the scope of
which people tend to underestimate significantly and (2) when you use a hosted
solution, you can't customize the site to be exactly the way you want it to be
— WordPress offers self-hosting and full customization.

Despite its warts and un-sexy image, WordPress _just works_ for most people's
needs when it comes to a simple blog, has a wide range of plugins that solve
most anything someone would need from a CMS, can be truly customized, and
allows them to move on and spend time on more important things.

~~~
fredley
I usually end up recommending Wordpress for the same reasons: it's the least
awful option for writing a blog that has your own template.

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yladiz
Caveat, I'm not the CEO of a company, but I feel like the priorities in this
are wrong (but maybe I don't strictly prescribe to the SV/startup mentality).
At first, especially if you are technical CEO, it makes sense to build the
product either alone or with your CTO/co-founder. However, I wouldn't consider
this a "first job" because while it's necessary at the beginning it isn't the
job of a CEO. For example, this post says, "Delegation should not be a word in
your vocabulary." This is really not true; good leaders and those who get lots
of things done are the ones who can delegate extremely efficiently and who can
trust those they delegate to do get the job done. In my opinion, building the
product is maybe 10% of the job of a CEO, even in the beginning. The 90% of
the job is actually building the company, building the brand, getting the word
out, delegation.

I would say that the first job of a CEO is building the company, the second
job is building the product. If I have time after all of my other priorities
were done, then I would help with the product (as in commit code, create or
collab on a design or product workflow, etc.). The title CEO isn't just a
random arrangement of letters: sure, it's fine to be part of the product in
the beginning when there's only a couple or few people, but once it moves
beyond that (and not at the 20 person level like this post says) the CEO
should really trust that the CTO and the product team can do their job while
the CEO handles all the other non-product aspects.

~~~
vinceguidry
> I would say that the first job of a CEO is building the company, the second
> job is building the product.

The problem with this is you don't really have a company until you have a
product to sell. And not all products can support companies. The roles in the
company have to orient around the product. Product _has_ to come first.

~~~
rkho
Exactly this. I associate "company first, product second" with the kinds of
organizations that seem to exist for the sole reason of playing company.

The mentality that important decisions within a new company boil down to which
friend gets which corresponding C-level title is just trivial to me. You don't
have a product and you're wasting time on the unimportant things. Literally,
your startup needs a CEO to guide the ship and a team who can help build the
product. Not a CEO, a COO, CTO, CMO, a Director of Engineering, a SVP of
Marketing, and who knows what other fancy titles you can come up with.

Product is king. Without a product, you don't have customers nor revenue.

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sandworm101
Lol. The job of a CEO is to implement the will of the board, of the people who
actually own the company. It is normal for startup CEOs to also be an owner,
or to know them all socially, but that doesn't mean they aren't a CEO.

If the board wants to expand, the CEO works to expand. But increasingly boards
fear rampant expansion. Some aren't looking to cash out via an IPO or buyout.
That path is becoming exceedingly difficult. Some want to see profit much
earlier. I know one startup with TWO customers, big customers, that is totally
focused on them and isn't seeking to grow. That board places customer focus
above anything else and instructs their CEO accordingly. He isn't happy. His
dreams of rampant expansion and market dominance have been quashed, but he is
still doing his job as CEO.

