22/07/2024 7:04 AM


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5 Signs You Need to Step Back as Founder of Your Startup

Sometimes the best thing your business is to take on a different role.

6 min read

Opinions expressed by Entrepreneur contributors are their own.

A month ago, I announced on LinkedIn that I was resigning as CEO of my company, Nav, and taking on a new role as Executive Chairman of our Board of Directors. It was one of the hardest decisions I’ve ever made, but also one of the most rewarding.

My motivations for stepping down were personal to me, and I hope to write about them in more detail as my new role gives me more time to look back and reflect. In the meantime, I thought it might be helpful to discuss five of the more general reasons a CEO would be wise to call it quits.

1. You’re consumed by what’s urgent instead of what’s important

One symptom that you’ve lost the reins of your business is that you only have time to accomplish urgent tasks and can never focus on what’s important. This usually occurs because you don’t have an effective system in place, and you lack the right people to figure out how to improve it. You’re too busy putting out brush fires to concentrate on the big picture. You’re consumed with internal drama, whether it stems from customers or employees or vendors. These crises keep you from working on what’s truly important to success. 

Examples of important responsibilities include shipping a product on deadline, closing a round of financing or filling a new head of engineering role. At the moment, these objectives aren’t urgent, but they will be if you don’t stay ahead of them. If you get too far behind and reach a point where everything is urgent — where mediating a squabble and closing a round of financing loom equally large on your to-do list — the end of your company isn’t too far behind. 

Related: Why Netflix Co-founder Marc Randolph Doesn’t Regret Stepping Down

2. You lose passion for your role 

There may come a day when you stop enjoying the job of CEO, when you simply lose passion for the ever-changing demands of that particular role. This is a dangerous spot, because it could lead to a loss of passion for your business itself.  In this scenario, you’ve identified your business with your duties as CEO for so long that you’re now at risk of growing to hate what was once your baby. But you haven’t really lost passion for your company — you’re just ready to evolve to a different role within it. Your growing impatience is a major symptom of that.

Changing roles can keep your original passion alive and burning. I speak from experience here. I’m not stepping down as CEO because I’ve lost love my love for Nav; on the contrary, I’m stepping down precisely because I love Nav so damn much. 

3. Your business outgrows your skillset

If you’re so good at your job that you reach a place where you need to fire yourself for your business to continue to flourish, congratulations! The fact that your baby has in some ways outgrown you is a huge compliment. You did so well that your company needs to move beyond you in your role as CEO, but this doesn’t mean that you can’t continue to pour your heart and soul into it in a brand-new role. As founder, you still have an invaluable part to play, and discovering what that is can be as exciting and rewarding as starting a business from scratch. 

4. Your anxiety reaches unmanageable levels

I’ve written a lot about anxiety lately, as I found that excessive stress seriously hampered my ability to deliver as CEO. Thanks to an awesome executive coach, I learned ways to cope with it and even turn it into a strength. If it’s something you just can’t escape, however, you’ll be severely restrained in your attempts to give your all to your business. 

Left untreated, anxiety will wear you out. It’ll compromise your judgment and put a strain on your relationships both inside and outside of work. There’s no shame in acknowledging that years of leadership have taken a toll on you and that it’s time to recharge your batteries. 

Related: What Happens When Founders Are Fired

5. You lose control of the company because of poor decisions

Sometimes, you can put your foot in it so badly that you lose control of your company altogether. You can be personally responsible for creating an environment in which you’re no longer capable of leading like you once did.

Travis Kalanick, the founder of Uber, is a prime example of this sad state of affairs. Remember when he was caught on camera cursing at one of his own employees for having the temerity to challenge him about falling wages? Not a good look.

It wasn’t actually a single moment that sealed Kalanick’s fate; it was a string of questionable moments that culminated in one that happened to go viral. Ultimately, the details didn’t matter. Kalanick had underperformed to the point that he lost the trust of his peers. Uber had an illness, and it could no longer look to its founder for the cure.

If you dig yourself a hole that’s too deep for you to climb back out of, it’s time to move on. Your business requires a new face and a new set of capabilities if it’s going to survive. Whatever your reason for stepping down from the helm, embrace it as a doorway to new challenges and possibilities. You’ve already proven you have what it takes to lead an organization; now’s your chance to show that your talents are transferable.

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