Editor’s note: Joe Kraus is a partner at Google Ventures, focusing on mobile, gaming, and local services. In 1993, he co-founded Excite.com, an early Internet search engine. He also co-founded JotSpot in 2004, a wiki company acquired by Google in 2006. Follow him on his blog, JoeKraus.com, and on Twitter: @jkraus.
One of the hardest things for first-time Founder/CEOs to figure out is what role to play as the company starts to grow.
All CEOs, founding or not, have a center of gravity. It can be sales, product, engineering, marketing, finance, etc. It’s the place they feel most comfortable, most grounded. It’s where they grew up in their career, or if they haven’t had much of one, it’s the place where they feel they have insight or instinct.
At the start of a company’s life, founder CEOs are often also doing the jobs of other “skill” positions (being the head of product, for example). But, inertia is a very powerful force. It’s very easy to just keep doing what you were doing. If you were a coder in the early part of your company’s life, it’s easy to just keep coding. If you were a product person in the beginning, it’s easy to stay deeply involved in product.
The error I see, far too often, is the founding CEOs do these skill positions way too long and don’t recognize the cost to the organization.
For example, let’s say a founding CEO is a really good product person. As the company adds its first few engineers, the CEO keeps playing the product role (in addition to, usually, the BD role, the sales role, and the marketing role). As the business grows more, the CEO realizes they need to add more bench strength by bringing in some senior specialists — let’s say a head of BD. Then the same happens for marketing. Then sales.
But the last thing to go is usually the CEOs “comfort zone” skill (what they grew up in their career doing and, in this example, product).
Founding CEOs usually don’t give up the role for a few reasons:
1) They’re incredibly picky. They know what they want (they’ve been doing the job) and they don’t believe any one else can do it.
2) It’s hard for them to spend money on something that’s already getting done.
3) It’s WAY too easy for the CEO to undervalue the opportunity cost of remaining head of product themselves.
4) It’s hard to recognize how much better the product would be if someone were focused on it full-time instead of them multi-tasking
5) They fear that they won’t know what value they’re adding any longer if they give up their skill position.
If you’re a founding CEO, I believe that you are doing your company a disservice if you don’t fire yourself from your skill position. Your goal, crazy as it sounds, is to free up 50% of your time by constantly firing yourself from whatever skill position you’re playing.
Why do I think this is important? Two reasons:
1. As the founding CEO, you’re one of the very, very few people who can hold the whole business in your head. You understand all aspects of the company. You know its founding. You know what the original insights were that led you to start this business in the first place. You have memory of your early mistakes. You know the history of all the product decisions you’ve made. You likely have an intuitive sense of customers, what it takes to entice and sell them, and what messages they respond to.
In short, you know the whole business like no one else does (your co-founders might be able to as well, but they’re likely going deeper into their skill positions). That’s what makes you unique and irreplaceable. That’s your highest value-add.
2 Given that you’re one of the only ones who can hold the whole business in your head, you need time to THINK. You need time to be able to consider where your business is heading. You need time to read. You need time to talk to customers. You need time to respond to a new, interesting opportunity that no one else has time for.
Slack time has tremendous (and tremendously underappreciated) value. A CEO with slack time and the drive to use that time to continually consider the future of the business is a fantastic combination.
With the whole business in your head and half of your time free, you can:
1) Spot new big opportunities earlier. Given slack time, you can synthesize new information you’re getting in the market, in what you read, in conversations you’re having, in letting your mind wander, and you can use that to spot new, big opportunities earlier than others.
2) Think longer term about how you want your business to look in one, two or three years. Skill positions don’t have that luxury.
3) Think about how your company might get killed.
4) Think about your *business*, not just your product. (Product-oriented CEOs confuse these two sometimes).
5) Consider if you’ve got the right people leading the skill position roles.
So, I encourage all founding CEOs to ask themselves the question — how would I free up 50% of my time? It probably involves (a) getting comfortable that getting slack time is actually very value-creating for the organization, and (b) hiring your replacement for the skill position you’re spending your time on.
Go ahead and fire yourself. You’ll be really glad you did.
Joe Kraus is a partner at Google Ventures, Google’s private market investment arm. His primary focus areas are: mobile internet, payment and financing services, gaming and local services. Previously Joe was a Director of Product Management at Google. Before joining Google he co-founded Excite, JotSpot, and DigitalConsumer.org. After the acquisition of Jotspot by Google in 2006, Kraus worked on OpenSocial, Google’s effort to develop API standards for social networking platforms. Joe graduated from Stanford University in 1993 with...
Google Ventures is the financially motivated venture capital arm of Google Inc., founded in 2009. Google Ventures invests in startups in industries including consumer Internet, software, hardware, clean-tech, bio-tech, health care and others. They aim to invest about $100 million a year, with deal sizes ranging from seed to late-stage investments of tens of millions of dollars, depending on the stage of the opportunity and the company’s need for capital. Google Ventures currently invests in the U.S. and has offices in...