Not a Mandate for Entrepreneurs to Become CEOs at their Own Startups, Says Stanford Professor

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The Indian startup ecosystem is currently seeing a wave of senior management restructuring at some of the most ‘celebrated’ startups. The likes of Ola Cabs, Flipkart, Zivame have seen stark restructuring measures been taken. Many of these announcements saw outsiders take up top leadership roles, overpowering the actual founders at these startups.

Stanford Graduate School of Business

Entrepreneur spoke to Haim Mendelson, The Kleiner Perkins Caufield & Byers Professor of Electronic Business and Commerce, and Management, Stanford Graduate School of Business.

Giving a general perspective of how founders let go of CEO and top leadership roles, Prof. Mendelson said for founders to run for top role, it requires a combination of passion and skills. “Sometimes the founders are really the best person to scale the company and at times the founders are much more interested in the early stages. Managing a lot of people and engaging in business transactions is very different from what they like the most,” he said.

At times founder is simply not the right CEO

Prof. Mendelson said that founders are those who have an overall vision for the company and personally, he believes that it’s not a mandate for entrepreneurs to become CEOs of their own startups. “It’s sometimes it’s a better idea.. sometimes the founder is just the wrong person,” he adds.

Prof. Mendelson also teaches how to develop new business models in the GSB's IGNITE, LEAD, Executive and MBA programs, and has worked extensively with entrepreneurs around the world.

According to him, there’s a lot of similarity in the kind of problems Silicon Valley and Indian entrepreneurs come to him with. “Typically the issues are around putting together a business model that works, fixing issues around existing business models,” he said.