Ask HN: Getting Rid of the Founder?
29 comments
The first thing I would advise is to be as transparent as possible with the founder, you can't go on like this. Don't go in as the whole team, it'll probably be a hard time for him, you need to break the news but let him time to digest before going into the details. Keep in mind without him you probably won't be working together on this great product.
I see 3 probable outcomes:
- he does not see the situation as you do, but does not want to leave. this would make leaving the company easier for you if your disagreement is too profound.
- he understands the misalignment won't be solve and quit (either by choice or following investors pressure)
- he agrees to try to change things, this will be hard because it won't happen instantly. Your team will need to set checkpoints with dates, which if not met bring you back to the start.
Anyway for your own mental state (and your teammates) you cannot go on like this.
I see 3 probable outcomes:
- he does not see the situation as you do, but does not want to leave. this would make leaving the company easier for you if your disagreement is too profound.
- he understands the misalignment won't be solve and quit (either by choice or following investors pressure)
- he agrees to try to change things, this will be hard because it won't happen instantly. Your team will need to set checkpoints with dates, which if not met bring you back to the start.
Anyway for your own mental state (and your teammates) you cannot go on like this.
I think this is sound advice. What I’d add builds on this point:
> he does not see the situation as you do
At the moment you may be lacking the perspective of the founder, perhaps the coaching and input they’ve had from investors and other advisors on the direction of the business. I would go into a conversation with the founder but seek to gain a true understanding of their perspective as much as to emphasise your own point.
> we unanimously felt that the product works, and the team is amazing
It takes more than a working product and an amazing team to make a startup succeed. The product might be amazing but do the unit economics work? Is there a market fit? Does the market fit scale? Is there something that needs to be hit to secure the next round of funding? Maybe you have this info and omitted it for brevity in your post… but if you approach your investors for a dialogue without a complete understanding of this side of the equation I’d say your in for a rough time.
> he does not see the situation as you do
At the moment you may be lacking the perspective of the founder, perhaps the coaching and input they’ve had from investors and other advisors on the direction of the business. I would go into a conversation with the founder but seek to gain a true understanding of their perspective as much as to emphasise your own point.
> we unanimously felt that the product works, and the team is amazing
It takes more than a working product and an amazing team to make a startup succeed. The product might be amazing but do the unit economics work? Is there a market fit? Does the market fit scale? Is there something that needs to be hit to secure the next round of funding? Maybe you have this info and omitted it for brevity in your post… but if you approach your investors for a dialogue without a complete understanding of this side of the equation I’d say your in for a rough time.
> He is constantly changing directions without consulting the rest of us, and is very opaque and autocratic about the whole thing. Many of the team members have left or developed serious mental health issues because of him.
Have you talked to him, voiced your concerns? What was his response?
Going to the investors could be a toss-up, especially if you haven't interacted with them beforehand. It may well be that the investor doesn't the capability to do anything or make any good judgement on the situation, or they don't care about attrition rates. Cruel but that's the way the world works, that's why investors don't really care about layoffs.
In any case, if you're going through with this, you should draw a line in the sand, know what you want, deliver an ultimatum to your CEO and follow through on them if he doesn't comply. Either you get fired, or he gives in. That's all there is to it.
Have you talked to him, voiced your concerns? What was his response?
Going to the investors could be a toss-up, especially if you haven't interacted with them beforehand. It may well be that the investor doesn't the capability to do anything or make any good judgement on the situation, or they don't care about attrition rates. Cruel but that's the way the world works, that's why investors don't really care about layoffs.
In any case, if you're going through with this, you should draw a line in the sand, know what you want, deliver an ultimatum to your CEO and follow through on them if he doesn't comply. Either you get fired, or he gives in. That's all there is to it.
Are investors majority shareholders? If the founder owns the majority of the company, I don't see how he could be removed. Are you all prepared to possibly lose your jobs over this?
It is very easy to get rid of the founder of an early stage startup that you disagree with: quit. You have no skin in that game, even with share options.
Quit and get a regular job. Start building your own version of this and release it shortly after the founder runs out of money.
Try to improve the situation if you're able to, don't make it personal, pursue other endeavors otherwise (and don't fall into the sunk cost fallacy).
And best of luck :)
And best of luck :)
When I was that CEO and a key person told me that either me or them was going to leave the company, I realized I couldn’t run the company with them. I asked to to make a proposal, they gave me a number that was big enough, and I walked.
I think it's worth appreciating there's a good chance the founder feels threatened by this kind of talk on a regular basis and perhaps they may even be experiencing uncertainty around their own decision making process or feeling out of their depth.
As others on this thread say, it might be a good step for the investors to talk privately with them about the issues involved, and perhaps ask what the founder's own recommendations would be to remedy the situation. There's always the face saving option of buying the founder out if the alternative is the company collapses from key staff quitting. The founder would have doubtless worked hard for the company themselves and wouldn't want to see it come to nothing or get themselves involved in costly legal proceedings.
Such a buy-out might even bring the founder some welcome relief from stress of everything being on their shoulders.
As others on this thread say, it might be a good step for the investors to talk privately with them about the issues involved, and perhaps ask what the founder's own recommendations would be to remedy the situation. There's always the face saving option of buying the founder out if the alternative is the company collapses from key staff quitting. The founder would have doubtless worked hard for the company themselves and wouldn't want to see it come to nothing or get themselves involved in costly legal proceedings.
Such a buy-out might even bring the founder some welcome relief from stress of everything being on their shoulders.
More talking, less thinking. It is a blocking issue so make sure that is clear to all parties - do not just continue work unless this is addressed.
> What we have here is a failure to communicate. Some [people] you just can't reach.
Knowing how to adopt an assertive mindset while maintaining your humility, and learning how to make and receive constructive criticism are key, in my opinion, to fostering an open dialogue that works to keep everyone on the same wavelength and more or less aligned with the common goals. It means everyone is comfortable with asking questions and raising concerns without fear of being met with hostility or an overly defensive posture. Issues are then addressed more quickly, before they can become entrenched problems, and without giving anyone an opportunity to stew about, nurturing resentments.
It sounds simple (and in many ways, it is) but it’s surprisingly counterintuitive, and usually requires conscious effort and practice before it becomes “normal”. Humans tend to be non-confrontational by nature, and practicing effective critique necessarily requires confrontations, albeit civil ones. I had a very small textbook from a college photography class I took that focused entirely on how to engage with criticism formally, and I believe that it made me a better photographer than any of the theoretical and practical study specific to photographs. I believe it also contributed significantly to my personal growth and professional development, as I became exponentially better at working with a team.
I tried to list some of the specific ideas that I took away from it, but it started to sound like a self-help advert, so I’ll leave it there. Learning to have hard discussions gracefully and pragmatically can be a superpower for a functional team.
Knowing how to adopt an assertive mindset while maintaining your humility, and learning how to make and receive constructive criticism are key, in my opinion, to fostering an open dialogue that works to keep everyone on the same wavelength and more or less aligned with the common goals. It means everyone is comfortable with asking questions and raising concerns without fear of being met with hostility or an overly defensive posture. Issues are then addressed more quickly, before they can become entrenched problems, and without giving anyone an opportunity to stew about, nurturing resentments.
It sounds simple (and in many ways, it is) but it’s surprisingly counterintuitive, and usually requires conscious effort and practice before it becomes “normal”. Humans tend to be non-confrontational by nature, and practicing effective critique necessarily requires confrontations, albeit civil ones. I had a very small textbook from a college photography class I took that focused entirely on how to engage with criticism formally, and I believe that it made me a better photographer than any of the theoretical and practical study specific to photographs. I believe it also contributed significantly to my personal growth and professional development, as I became exponentially better at working with a team.
I tried to list some of the specific ideas that I took away from it, but it started to sound like a self-help advert, so I’ll leave it there. Learning to have hard discussions gracefully and pragmatically can be a superpower for a functional team.
Why is the autocrat of our company, the CEO, acting like... an autocrat/CEO?
Hmmmmm.
I agree with other commenter - polish up your resume.
You can try to have a chat with them, but they'll hate you and you might get fired.
You can go to the investors, but they'll hate you and you might get fired.
You can send an anonymouse letter to ceo and/or investors and try not to get outed but seeing as how you're brave enough to post here you'll prob be first fired.
I don't think your situation is unique at all.
You can always quit, into another company or not.
If I'm your bestie, I'm saying, don't do shit. Let dictator run it into the ground. Amazingly, they might not. AI is so hot, if you got funding, you might be lucky enough to stick around.
Companies can survive and thrive with even a seemingly-catastrophic amount of mismanagement and chaos -- including nepotism and outright criminal activity.
KGTC keep getting them checks. save your money. start interviewing lightly. try to make it to the point the CEO either runs the company into the ground, or they are pushed out by the investors.
Hmmmmm.
I agree with other commenter - polish up your resume.
You can try to have a chat with them, but they'll hate you and you might get fired.
You can go to the investors, but they'll hate you and you might get fired.
You can send an anonymouse letter to ceo and/or investors and try not to get outed but seeing as how you're brave enough to post here you'll prob be first fired.
I don't think your situation is unique at all.
You can always quit, into another company or not.
If I'm your bestie, I'm saying, don't do shit. Let dictator run it into the ground. Amazingly, they might not. AI is so hot, if you got funding, you might be lucky enough to stick around.
Companies can survive and thrive with even a seemingly-catastrophic amount of mismanagement and chaos -- including nepotism and outright criminal activity.
KGTC keep getting them checks. save your money. start interviewing lightly. try to make it to the point the CEO either runs the company into the ground, or they are pushed out by the investors.
You really don't have much leverage here unless you're also on the board or have an unusual pull with the board.
I've been in this situation a couple of times. In both situations the board ended up replacing the founder. The first time, the entire investment team and board were what I think of as "vanity VC"—basically a group of angels who knew each other, and while they were all good at their day jobs, they were just as bad at running the company through their replacement as the founder was, and the company, while still around the company is basically treading water.
In the second situation I joined a startup and its founder CEO was replaced about a year after I got there. At first we were all pretty on edge over this, but overall I think it was a good move—the investors are legit, and the replacement CEO is experienced, with a couple of exits in the sector under their belt. I believe this one is going to have a good ending.
Bottom line, the only leverage you've got is your time and where you spend it. If you believe in the mission but not the founder, your best bet is to find another company in the same vertical and spend your time there... but vet the management team carefully! (as always...)
I've been in this situation a couple of times. In both situations the board ended up replacing the founder. The first time, the entire investment team and board were what I think of as "vanity VC"—basically a group of angels who knew each other, and while they were all good at their day jobs, they were just as bad at running the company through their replacement as the founder was, and the company, while still around the company is basically treading water.
In the second situation I joined a startup and its founder CEO was replaced about a year after I got there. At first we were all pretty on edge over this, but overall I think it was a good move—the investors are legit, and the replacement CEO is experienced, with a couple of exits in the sector under their belt. I believe this one is going to have a good ending.
Bottom line, the only leverage you've got is your time and where you spend it. If you believe in the mission but not the founder, your best bet is to find another company in the same vertical and spend your time there... but vet the management team carefully! (as always...)
You have three options:
1. Legal
2. Financial
3. Personal Relationships
Unless you are also a founder with a significant stake, you probably only have option #3.
First, you have to know the legal ownership structure of the company. If the founder owns majority control of the company, there's not a lot you can do on the legal side.
Second, you need to know where the money is coming from. If it's all from investors, you might have a little leverage but not much. If you all go to the investors and say you all want to kick out the founder, lots of bad things could happen. The investor could get scared and pull out (especially if they mainly have a relationship with the founder). The investor might side with you but still not have a way to kick the founder out other than threatening not to invest additional money. Maybe the investor decides the drama isn't worth it and walks away completely. It just depends on the the situation and ownership agreements.
Third, you can just go talk to the founder. This is probably your best bet (like others have said). Maybe you can come up with a way to convince the founder that they did a great job of getting you to where you are, but their skills are better spent starting another new company while the team carries on with this phase of growth and development. Tell the founder that they are really good at zero to one, but you need to carry on from here more systematically to be successful.
But no matter what seems fair or who did how much work, you probably can't just "kick out" the founder. You'd do best to figure out how to make a deal where everyone hopefully comes out reasonably happy and the founder can save face.
If that doesn't work, all you could really do is quit en masse and go start something else without the founder.
1. Legal
2. Financial
3. Personal Relationships
Unless you are also a founder with a significant stake, you probably only have option #3.
First, you have to know the legal ownership structure of the company. If the founder owns majority control of the company, there's not a lot you can do on the legal side.
Second, you need to know where the money is coming from. If it's all from investors, you might have a little leverage but not much. If you all go to the investors and say you all want to kick out the founder, lots of bad things could happen. The investor could get scared and pull out (especially if they mainly have a relationship with the founder). The investor might side with you but still not have a way to kick the founder out other than threatening not to invest additional money. Maybe the investor decides the drama isn't worth it and walks away completely. It just depends on the the situation and ownership agreements.
Third, you can just go talk to the founder. This is probably your best bet (like others have said). Maybe you can come up with a way to convince the founder that they did a great job of getting you to where you are, but their skills are better spent starting another new company while the team carries on with this phase of growth and development. Tell the founder that they are really good at zero to one, but you need to carry on from here more systematically to be successful.
But no matter what seems fair or who did how much work, you probably can't just "kick out" the founder. You'd do best to figure out how to make a deal where everyone hopefully comes out reasonably happy and the founder can save face.
If that doesn't work, all you could really do is quit en masse and go start something else without the founder.
Add this to your list of behaviours to check for in founders when joining your next startup and leave as soon as it makes financial sense to do so.
Your CEO’s primary job is to steer the ship and inspire employees.
They’re exhibiting personality traits that aren’t fixable in most people that I’ve seen this in over my career. They likely will never change and almost certainly not in the middle of this startup experience.
Yes you invested time in building this idea, and you can take everything you learned and your experience on with you in your career. If you vested some equity or wait till you do so then you can also benefit from it’s success. But from what you describe this CEO is likely one of the 90% of startups that fail so I wouldn’t hold my breath.
Good luck, on to the next.
Your CEO’s primary job is to steer the ship and inspire employees.
They’re exhibiting personality traits that aren’t fixable in most people that I’ve seen this in over my career. They likely will never change and almost certainly not in the middle of this startup experience.
Yes you invested time in building this idea, and you can take everything you learned and your experience on with you in your career. If you vested some equity or wait till you do so then you can also benefit from it’s success. But from what you describe this CEO is likely one of the 90% of startups that fail so I wouldn’t hold my breath.
Good luck, on to the next.
Remember two things:
Investors invest in a vision and people/teams. You're an employee, not the funded team. You may feel you're more than a wage taker, do the investors agree you are not a fungible coder?
Development isn't that hard. Hard CS gets done in environments that are not about pushing to market, that's commercial coding, mainly doing not hard stuff in a new environment. What's hard is linking everything, code, customers, vision, offline... The code is the essential but not that hard bit. Plus, are you blinkered to your contribution so much you cannot observe the vision. Just a coder doing the predictive, doable part where elsewhere chaos needs to be lived in.
Ask yourself these questions.
Investors invest in a vision and people/teams. You're an employee, not the funded team. You may feel you're more than a wage taker, do the investors agree you are not a fungible coder?
Development isn't that hard. Hard CS gets done in environments that are not about pushing to market, that's commercial coding, mainly doing not hard stuff in a new environment. What's hard is linking everything, code, customers, vision, offline... The code is the essential but not that hard bit. Plus, are you blinkered to your contribution so much you cannot observe the vision. Just a coder doing the predictive, doable part where elsewhere chaos needs to be lived in.
Ask yourself these questions.
You need a “company uncle” and fast. Normally this would be one of the more experienced investors but could be someone hired in by them. This sort of this is quite a common growing pain, I saw it in my own startup and in the startup in which I was an early employee. Unfortunately our “company uncle” has long since retired. Thanks for all you did David, wherever you are.
Frank in succession
Offer to buy the company from him then, how can that not be the first thought in your heads? Since you know the business and are sure you will run it better than him.
From what you’re referring… I’d say go for it.
Yes, we all have made up our minds about it. But we are still trying to figure out the logistics.
Good luck to you. Coup d'etat isn't something everyone can say that they participated in. This will either work out well and you'll be high-fiving the remaining team—or you're all getting fired. Simple as.
FWIW, I've worked at places (plural) like the one you've described. In my experience, "reading the writing on the wall" and focusing on my resume and marketability (in preparation for leaving) was "the move". I burnt no bridges, even when I really wanted to.
FWIW, I've worked at places (plural) like the one you've described. In my experience, "reading the writing on the wall" and focusing on my resume and marketability (in preparation for leaving) was "the move". I burnt no bridges, even when I really wanted to.
If the team is so amazing, you should probably rethink firing the dude who formed it. Why don’t you guys start your own company?
What would you do if your are in my situation?
I would assume I am misreading the social context.
YMMV. Good luck.
I would assume I am misreading the social context.
YMMV. Good luck.
Run from this job it will end poorly for you
For the last year, I have worked in a startup. There are five people in the core team: the founder, the CTO, two domain experts, and I. I developed the core technology along with the domain experts. I know the founder from grad school, but nowadays I mainly work with our CTO.
So our team works relatively well, but our CEO has becoming more and more a headache for all of us. He is constantly changing directions without consulting the rest of us, and is very opaque and autocratic about the whole thing. Many of the team members have left or developed serious mental health issues because of him. Recently, he even hired his girlfriend as the sales director (who is totally unqualified), and she is starting to bypass the product manager and directly influence the development process, which as expected, results in absolute chaos.
I have talked with the whole team and the CTO, and we unanimously felt that the product works, and the team is amazing, and the sole problem really IS the founder. We have dedicated lots of efforts into this product, and we want to try to atleaset preserve some of our hard-work. And now we are thinking about going directly to the investors and have him removed, but we are not very optimistic about it.
Has anyone ever been in a similar situation? What would you do if your are in my situation?