Being A Great CEO

Matt Blumberg’s new book, Startup CEO: A Field Guide to Scaling Up Your Businessis about to come out. If you are a CEO and haven’t preordered it, I recommend you go get it right now.

I had a chat with a CEO I work with who has had a challenging year scaling up his company. He – and the company – have made a lot of progress after hitting a low point this spring. After the call, he sent me the following note he has pasted on his desk.

1. Lead by example by holding myself and all accountable, no matter how hard.

2. Set the overall vision and strategy of the company and communicate it to all stakeholders.

3. Recruit, hire, and retain the very best talent and inspire them.

4. Makes sure there is always enough cash in the bank.

5. Be the advocate for the customer over the company’s short-term needs.

6. Drive the execution and evolve the operating system.

7. Champion the company and our mission to the world.

You might recognize #2, 3, and 4 from Fred Wilson’s magnificent post What A CEO DoesI give a talk for many of the Techstars CEOs called “How to be a Great CEO” and I focus the conversation around Fred’s points. Matt’s book also uses Fred’s three points as a framework. And when I think about how a CEO is doing, I always start with 2, 3, and 4.

I’ve come to believe that you can’t be a great CEO if you don’t do these three things. But, great CEOs do many more than just these three things. So – I view them as “price of admission” – if you can’t / aren’t doing these three things, you won’t be a great CEO.

I always encourage the CEOs I talk with to create a clear framework for what they are doing. What you are doing, and spending time on, will change over time based on the stage of your company. When you are 10 people, you’ll have a different set of priorities then when you are 100, or a 1,000 people. But having a clear framework for what you, and how you do it, is powerful.

I love what this CEO has done to make Fred’s framework his own. Notice that each sentence starts out with the imperative form of an action verb (Amy told me that – doesn’t it sound smart!) – basically a statement of action. Lead, set, recruit, make, be, drive, champion. Great words.

If you break it down, it also defines a value set for the CEO, and for the company.

Finally, you are going to hear a lot more from me about the Company Operation System (what you see in #6). That’s the essence of what Matt Blumberg has figured out in scaling up Return Path, and uses to define his approach to scaling a business in Startup CEO: A Field Guide to Scaling Up Your Business.

My experience with all of this is that it’s incredibly hard, breaks regularly at different points in the life of a company, and requires a great CEO to continually grow and learn from mistakes, adjust course based on new information, and work diligently at being honest with himself, his team, and his board about what is going on. But, if you get it right, it’s magical.

  • http://John.do/ John Saddington

    purchased. thanks for the link!

  • http://blog.printfection.com/ Casey Schorr

    Purchased the book. Love Matt’s blog. And, most of all – love the note on the desk idea.

    When we first started Printfection, I had a note with a $100 bill as the background saying “$100,000 in revenue, three months in a row”. Everyone else on the team copied my note, and low and behold we hit our goal faster than we thought possible. Simple things like a note you look at every day are really powerful to remind you of the framework you’re working within.

    Personally, as a “creative” leader, I underestimated the power of working within a framework for way too long. I resisted, thinking it would hinder my creativity and turn our environment too “corporate”. But luckily, my more logic-focused co-founder (the first developer) pushed a framework down our team’s throat without my permission. So glad he did that. Now we have 90 day plans, weekly, quarterly, and annual meetings. It’s amazing how a clear framework allows you to be more creative while also remaining focused on what everyone agrees are the top priorities.

  • http://mattamyers.tumblr.com/ Matt A. Myers

    I can’t foresee how you could function without a framework. I certainly need a visual representation to verify and check back on what I decide to focus on – and to make sure I’m not neglecting any areas.

    This mostly is currently in my head, as I’ve not needed to share it with a mass amount of people yet – and not having to educate people on it yet. I imagine your whole team would need to use this framework – if you are to adequately “communicate” (#2) to the company – employees being stakeholders too (not sure if this is implied?).

    • http://www.feld.com bfeld

      Employees are definitely stakeholders. Some would say they are the most important ones.

      • http://mattamyers.tumblr.com/ Matt A. Myers

        I assumed you meant that, just not directly stated here. :)

  • http://www.justanentrepreneur.com Philip Sugar

    Here are mine:

    I have always looked at my job as five things (I’m a simple guy and can only keep track of things on one hand)

    1. Get rid of all obstacles for my people to get things done.

    2. Orchestrate between departments: Sales, Marketing, Development, Delivery, Support, Finance: No one department drowns out the others.

    (actually I think I am very good of that because of my educational background in Development and Finance and self taught sales skills, and I take a call from each customer every year)

    3. Make sure people do the hard stuff they don’t want to do and keep them accountable for doing it.

    4. Find the best people and keep them.

    5. Define the strategy which means what we do and just as importantly what we don’t do.

    • http://www.feld.com bfeld

      #2 and #3 are great adds to the list.

  • Founder

    I think founding team is equally responsible for lot of the tasks you have mentioned. So how about “how to be a great founding team”? :)

    • http://www.feld.com bfeld

      Ultimately, there has to be one person who owns this. There are other things great non-CEO founders should do – I’ll cover them in a separate post.

      • Founder

        I agree with you that someone needs to be answerable. That said I may not agree with you particularly in the case of early stage startup (~ 10-15 employees or less). I feel there is lot of glorification around “CEO” as a role. In some cases, CEO gets all the glory even though other founders have taken equal amount of risks and work equally hard. Sometimes other founders get second class citizen treatment from media as well as investors.

        Moreover, lot of times CEO may be the person who becomes CEO because he may not be specialist in other roles in really early stage startup. He/she may not be best product/technology person so someone has to do operation/sales. And that person is CEO. Seth Sternberg (from Meebo) had interesting post on it (http://techcrunch.com/2011/05/30/pre-launch-startup-ceo/).

        In short I’m not against CEO. But I’m against the culture of glorifying the role of ‘CEO’. Even if I’m a CEO I prefer to call myself as founder. I think for success of any startup you not only need exceptional CEO but also exceptional founders and employees.

  • erict19

    Thanks for sharing Brad – RE:2, I remember consulting with startup of a CEO who used to hand out a note card to all employees and most guests with the 5 steps to focus on to achieve their vision.

  • http://www.startupmanagement.org/ William Mougayar

    You nailed it. I don’t what else to add.

    • http://www.pointsandfigures.com/ pointsnfigures

      Have the courage to delegate and trust your employees; Have the courage to show vulnerability in front of them when it’s appropriate.

      • http://www.feld.com bfeld

        Vulnerability is such an awesome word – and powerful thing to display and embrace.

  • Jeffrey Hartmann

    Just curious Brad, how do you feel about CEO’s that also focus on a functional role (especially early)? Specifically things like maybe a very product focused CEO (either from a design or engineering perspective), or a CEO that also fills in the shoes of say a Chief of Marketing or Finance, or maybe even Director of Engineering or Chief Scientist? In your experience how have you seen this work/not work? Sure there are lots of success stories (Apple, Facebook, etc.) where the CEO is cross functional, but I’m curious if you have seen any trends worth mentioning with people who are purely CEO’s and those that are cross functional. Any specific advice for the cross functional CEO’s out there?

    • http://www.feld.com bfeld

      I love love love product focused CEOs. But – don’t stay in the functional role too long – e.g. I’m CEO and VP Engineering – that’s a great way to be unhappy. Same with I’m CEO and VP Sales.

      • karen_e

        Isn’t this the truth. You aren’t doing anyone a favor by wearing too many hats. Remember the corollary to Fred’s three points, “Everything else should be delegated to the team.”

  • http://www.lisaabeyta.com/ Lisa Abeyta

    Thank you for this. I recently acquired a technical team, bringing on three cofounders with far more technical skill and experience than I will ever have. But the experience of working together has proven to me that everyone and everything works better when the CEO drives the vision, culture, and timeline. CEO’s who balance a sense of security with a sense of urgency foster teamwork, and when a CEO can do this, the speed and quality of development benefits everyone.

  • http://startuphappiness.com/ Dale Larson

    Love this personalized take on Fred’s points, especially as we refer to them all the time. Great idea for any CEO to make it their own this way. Comments by point:

    1) High performance teams are great at giving and receiving feedback as well as holding each other accountable. (Frankly, Friendly and Frequently)

    2) As my partner Marcy Swenson loves to point out, a critical piece of communicating vision is constantly providing context. Context is the why that helps each team and team member apply the vision to their work, priorities and decisions. It is the backstory for why we do things the way we do– and includes everything historical we know about customers, product, our employees, and our choices.

    5) I love 5. If the CEO isn’t strongly advocating for the customer, how effectively can anyone else? If no one advocates strongly for the customer, how can the product possibly be as good as it needs to be to realize the vision?
    6) I can’t wait to hear more about your thoughts on execution and operating system. (As coaches, we are used to thinking of the operating system of the founders as the beliefs and assumptions they hold about the world that drive their behaviors.)

  • Richard Leavitt

    Good list with something missing. I’ve been close to a successful “Culture 1st” CEO
    for some time. They are not, in fact, owner of #2, and instead rely on
    the leadership team to fulfill this, although they are a strong
    communicator (#7). Where does defining, installing, protecting and evolving the company’s culture belong in this list?

    • http://www.feld.com bfeld

      Great point Richard. The “servant leader” – which Tim is most definitely – approaches it this way. And – while semantics – is a powerful distinction.

    • http://startuphappiness.com/ Dale Larson

      You could certainly make a good argument for emphasizing this with its own item on the list, but it’s also a crucial part of #3. One of the best ways to attract and keep the best is with values, culture and mission that appeal to them. And perhaps for a more servant/less product CEO, this is just another form of #2 (which is sometimes phrased in such a way as to indicate it’s sometimes about communicating and championing the vision more than personally setting it). Communicating about culture is just as important as communicating about product and they are both vision (especially if you see the company you are building as being as much the thing you are creating as whatever you’re selling).

  • http://www.theequitykicker.com brisbourne

    Great post Brad. I wanted to put it on my blog, but couldn’t think of anything much I could add so I satisfied myself with a retweet.

    • http://www.feld.com bfeld

      Thx!

  • Shane Schieffer

    Thanks Brad, a subject very much on the top of my mind!

  • Kalsoom

    Love the action words lead, set, recruit, make, be, drive, champion – I think the learning just from those words alone is significant. A good CEO has to be action-oriented, intentional & introspective. Excited for the book! We love you in Pakistan, Brad!