Your balanced and introspective summary makes me think that you’re probably being fair in your criticism and that there is a problem with your cofounder
There is a minor question I have: why do you need the company to grow? What does that achieve? Is it necessary?
The need (I feel) to grow has to do with a few things. We're in a market segment that most people think is about to die, but it's actually growing. So, we're in a good spot.
I also feel like I owe it to my investors who want this to grow quite a bit, and that is why they give us money is to grow.
Last, I feel like I owe it to the people who work here, as I firmly believe that if you're not growing you're dying.
Based on the information in your post, I cannot judge whether it is actually necessary to grow in order to survive in the long term. If you want, feel free to share some more details, e.g. what industry you are in.
In any case, what is clear to me is that it is very damaging that you and your co-founder don't agree on how to proceed. I'm pretty sure your employees will have noticed the tension by now, and it will certainly have a negative effect on their performance. The main goal should be to resolve the argument as quickly as possible and decide either on growth, or staying a small business.
Does your co-founder not see the same need to grow? Does he prefer to keep the company small, and if yes, what are his arguments?
It is an ordinary thing for a company to grow its sales operation as the company grows. At some point you need to bring in salespeople, either juniors who follow the existing playbook or more senior people who know how to expand an organization, write a playbook, etc.
The title problem can be addressed by giving the co-founder a promotion in name since now they are the nominal head of the sales organization.
There is a minor question I have: why do you need the company to grow? What does that achieve? Is it necessary?