Why Having Co-CEOs is a Bad Idea, Almost Always
Recently, David Cohen and I both changed our titles to co-CEO of Techstars.
We’ve long preached that having two CEOs at a startup is a bad idea, so why did we do it?
First, why doesn’t it work?
Usually, it’s because it’s done for the wrong reasons. Often a company has co-CEOs because they have co-founders that don’t want to create a hierarchy between them; they want to view each other as equals. But in almost all cases, one CEO feels like they are carrying the other. This ultimately leads to founder issues, which is the leading cause of death for startups.
Even if they view each others as equals, that doesn’t mean that they always agree. When they don’t, who decides? Even worse, as the company grows, which CEO do people go to for decisions? Often, they will feel that they need to get buy-in from both, leading to slower decision making. Or, employees play mom against dad, finding which CEO will back their point of view. If one of the co-founders is technical, the titles should probably be CEO/CTO. If neither is technical, the real question may be “why not?”
In our case, this actually isn’t a change, it’s how we’ve always operated.
It works because we truly do view each other as equals. We’ve been working together for more than 25 years, across a variety of different startups. In our first company, Pinpoint Technologies, I was CEO and David was CTO (although we called it President and VP of R&D back then). At one point at Techstars, David was CEO and I was President. Most recently, we were both Managing Partners. None of those titles represent our reality, which is that regardless of our titles, we view each other as equals. We also know each other’s strengths and weaknesses and we know them well. We don’t divide up the work, it’s more that we know who is the tie breaker in any given situation.
Our only rule is that everyone needs only one yes and everyone gets only one no — you don’t have to ask permission from two people. Then we make sure we have great communication between the two of us.
As with most things in life, there are no universal truths. While I still don’t generally recommend it to others, it works for us. It takes a long history together and a deep understanding of the other person. Think about where you need to break convention in your business to find success.
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This post was originally published on Techstars’ blog.
