The Problem With Your Business Is You: Making the Shift From Founder to CEO If your company is in a period of decline or stagnation, the issue with your business may just be you.

By Darrell Kopke

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

Often when a company reaches a growth plateau or has a misstep in the business plan, the founder blames others when in actuality it may be them.

I recently met with a software company that saw five consecutive years of stellar growth, peaking at $6 million in sales, followed by two years of stagnation before sales started falling. The founder, who manages a team of 80 people, is overworked, tired and stressed, yet pushes himself to try and regain the momentum of three years previous.

A little dig under the surface and what becomes clear is that the founder is still writing marketing copy, correcting coding mistakes and attending all tradeshows and sales meetings. He has a senior leadership team but consistently undermines their decisions by making snap decisions that change the nature of projects. There may be 80 people working for the company but only one decision maker.

Related: Searching for Wisdom? Search Yourself.

From the founder's perspective, the reason for stagnation is the combination of a weak marketing team, a competitive job market for developers and clever moves by competitors. My interpretation is much simpler: To find the cause of decline or stagnation, the founder need look no further than the mirror. Think of it like this: The initial success and traction was a result of your intellect, passion, vision, hubris and work ethic. You were responsible. If you are currently facing stagnation, however, you cannot escape responsibility now.

The shift from founder mentality to CEO mentality is not a natural progression. Founders who have built their companies by controlling all elements of their business find it difficult to let go and let others lead the charge. They fear they will lose touch. Every hands-on founder reaches their saturation point, a time when there are simply not enough hours in the day to have your hands in every project. Founders who do not let go become bottlenecks to the growth of their organizations.

For those making the shift from founder to CEO, here is how to handle the transition.

Value your time at $1000 per hour. As a CEO, you must value your time above all else. Measure your life as if it is worth $1000 per hour and make decisions on how you spend your time accordingly. Effective CEOs ask themselves, "What's the best use of my time right now?" Working on materials that a junior copywriter should be completing is not good use of your time. Instead, focus on revenue creation worthy of that high hourly rate.

Related: Why Being Self-Critical Can Make You a Stronger Founder

Do nothing and manage everything. A shift in mentality is in order. CEOs must work on their business, not work in the business. Effective leaders align their team around a clearly defined set of desired results and then manage for these results. Manage the who, what and when, not the how. By taking your hands out of the how you open yourself up to the capacity required of a CEO.

Become the chief why officer. Context is important in leadership. By framing yourself as the "Chief Why Officer," you are always reminding your team why the company is doing what it's doing, why you exist and what your legacy will become. These reminders allow the team to rally around a shared set of core values. Guiding people on your values provides context for their decision making. All levels of your organization can align their decisions around a set of intentions.

Founders who successfully shift from founder thinking to CEO mentality do not lose touch with their businesses. Instead, they open themselves up to the capacity to lead the company to a brighter, more prosperous future.

Related: The Secret Sauce of Successful Entrepreneurs? It's All in Their Head.

Darrell Kopke

Co-founder and Principal, institute B

Darrell Kopke is the co-founder and principal of InstituteB, an accelerator for businesses that put profit and societal value on equal footing. Kopke also holds ownership positions in several growth companies and a board position with The Gratitude Aeffect Foundation, a Vancouver-based charity devoted to ending homelessness. Prior to InsituteB, Kopke was the general manager (and sixth employee) at Lululemon Athletica.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Leadership

5 Trailblazing Black Women Entrepreneurs Share How They're Breaking Barriers — And How You Can Too

52,374. That's how many Black women-owned businesses there were in the U.S. in 2020. Although this number might seem insignificant, their impact can be felt. According to J.P. Morgan, Black women are the fastest-growing group of entrepreneurs, and there's no end in sight.

Side Hustle

This Gen Zer's Stylish Side Hustle Earns About $20,000 a Month and Paid Off His Parents' $200,000 Debt: 'I Enjoy the Hands-Off Nature'

Ray Cao went from working as a barista for $8 an hour to being a successful seller on online marketplace StockX.

Business News

'A Lobstrosity': Social Media Is Losing It Over Martha Stewart's Latest Meal Posting

The 82-year-old caused quite a stir on Instagram this week.

Business News

This Retailer Is the Latest to Remove a Major Feature From Its Stores Due to Rising Theft

Five Below CEO Joel Anderson addressed the company's plans to combat theft in an earnings call earlier this week.

Business News

Make $177,566 With No Experience in 3 Months: A Popular Online 'Side Hustle' Course Is Under Investigation After Customers Complain About Its Deceptive Claims

"All you need is a phone, a laptop, wi-fi and one to three hours a day," one affiliate marketer said in a video posted to social media.

Leadership

2 Phrases I Learned From a Senior CIA Officer That Changed My Leadership Style

There are two things you should learn from modern covert operations and espionage. Use them wisely.