How Entrepreneurs Make the Leap to Fast Growth CEOs

The transition from startup founder to CEO of a fast-growing company is one of the biggest challenges an entrepreneur can face. Many founders struggle to let go of the operational responsibilities they held in the early days and take on the more strategic role required at the next stage of growth. Making this leap successfully requires founders to recognize when it’s time to make the change, adapt their leadership style and behaviors, and align the organization to support scalable growth.

Recognizing When It’s Time

The shift from founder to growth CEO usually happens somewhere between $5 million and $30 million in revenue. At this stage, the company has grown beyond just the founder and a handful of employees. There are multiple layers of management, more specialization in roles, and an increasing need for structure and process.

Day-to-day decisions become more complex with more voices involved. The founder can no longer be hands-on with every product feature or customer interaction. Micromanaging will only stifle innovation and growth. To thrive at the next level, founders need to transition from individual contributor to strategic leader.

Some signs it’s time to make the leap:

  • You spend more time in meetings and putting out fires than working individually on critical projects.
  • Key decisions are delayed waiting for your input.
  • You feel disconnected from customers and employees.
  • The organization seems stuck and you’re not sure what to do next.

The company needs a CEO who can set clear strategic priorities, lead the executive team, and manage the organization for scalability. If these activities don’t play to the founder’s natural strengths, it may be time to evolve the role.

Adapting Your Leadership Style

Stepping into the CEO role requires pivoting from a hands-on doer to a strategic delegator. Rather than trying to control everything personally, growth CEOs must learn to lead through influence.

This starts with clearly communicating the company’s vision and rallying the team around strategic goals. With too many tactical details on your plate, it’s easy to lose sight of the big picture. As CEO, your job is to connect the dots and explain how each person’s work ladders up to the overall mission.

You’ll need to let go of some decisions and trust your team to execute. Identify the most critical issues only you can or should decide, like financial planning, partnership deals, and executive hiring. Delegate the rest with clear expectations.

Replace day-to-day tasking with coaching your direct reports. Check-in regularly to provide feedback, unblock obstacles, and develop their leadership skills. Effective coaching builds competence and confidence.

Rather than commanding action, influence people by asking insightful questions and listening closely to understand their perspective. A collaborative leadership style will empower your team to step up. Model the humble confidence and curiosity you want your managers to embody.

Aligning the Organization

To enable growth, you need to align the structure, systems, and processes of the organization. This ensures that roles, responsibilities, and workflows are defined to efficiently execute at scale.

Review the organizational structure and make changes to better distribute workloads. You may need to bring on more senior managers, divide large teams into specialized departments, or elevate individual contributors into management positions.

Define responsibilities for each role so people understand their scope of authority. Document core processes like product development, sales, and customer support so that work is consistent as the company grows.

Build scalable systems to reduce friction points. For example, implement CRM and project management platforms, automate repeatable tasks, and create shared templates and resources.

Streamline meetings and decision-making by clarifying who has input versus final signoff. Misalignment causes bottlenecks, so get the executive team aligned on priorities and workflow.

Institute quarterly business reviews to regularly assess progress on goals and realign as needed. Annual off-sites can reconnect teams to the big picture.

You can’t scale a highly operational, founder-driven organization just by working more hours. Setting the right management foundation will empower your team to take on more ownership and responsibility.

The Impact on Company Culture

Letting go of control can seem counterintuitive for founders accustomed to an operational role. However, the only way to build an enduring great company is to evolve the culture for sustainable growth.

With a larger organization, you have less visibility into day-to-day work. Culture becomes your primary lever for maintaining engagement across the company. Share your vision regularly so people feel connected to the mission. Embrace transparency by communicating openly and listening often.

Preserve the best aspects of your startup culture, like agility, collaboration, and innovation. But also introduce more structure needed to support growth. Clarify expectations for each employee and share how their work contributes to success.

Maintain the human spirit of a startup through connection. Spotlight different teams and projects. Celebrate wins large and small. Throw in some fun to keep energy and camaraderie high.

The more you involve employees in shaping culture, the more they will embody it. Ask for input on new processes and programs so people feel ownership. Enable frontline employees to identify and solve pain points.

Overall, balance the structure needed to scale with the nimbleness required to adapt quickly. Communicate frequently and authentically to unify people around your growth mission.

Making the Leap

The evolution from founder to CEO is a challenging but necessary step in your company’s growth journey. By recognizing the transition points, adapting your leadership behaviors, and aligning the organization, you can make this leap smoothly and successfully.

The most important mindset shift is accepting that you can’t do it all. Build a strong executive team that complements your skills and experience. Coach and empower managers to take on more responsibility. Learn to lead through influence rather than control.

Here are some key tips for making the founder to CEO transition:

  • Be self-aware – understand your strengths and limitations. Where do you need to improve or bring on help?
  • Let go incrementally – start delegating decisions and responsibilities you can part with.
  • Communicate the “why” – connect team priorities to the bigger vision.
  • Build scalable systems – reduce dependency on the founder by documenting processes.
  • Coach emerging leaders – develop managers to operate with autonomy.
  • Get a coach – an experienced advisor can help you navigate hurdles.
  • Join a peer group – learn from how other growth CEOs made the transition.

With the right foundation, your company and people will thrive at the next level. The entrepreneurial spirit you instilled will scale to drive sustainable growth for years to come. By becoming an inspiring growth leader, you’ll unlock the full potential of your fast-growing business.

As CEOs, we confront critical choices – growth strategies, succession planning, employee engagement, leadership development…the list seems endless. The weight of these decisions can feel exhilarating, yet also stressful. And lonely.

Even though I started an INC. 500 company, I spent too many years trying to navigate it all solo. I’ve learned every CEO needs a community of peers who understand the unique challenges we face.

Peernacle is a private peer advisory group where leaders in southern Virginia come together and help one another to make better decisions and grow as leaders. If you’re looking for a community where you can gain insight from others who have sat in your seat, explore Peernacle group membership.