Built a company? When did you realize you needed a COO (or ops exec)?
I am in the midst of writing a follow-up article to one I have written to address some myths about startups and operations executives. In 15 years I have been through 9 startups (co-founder in 2 and early employee in most). In almost every one them I held different levels of hands-on and operations leadership roles. Every single founder, who brought me onboard, had certain "catalyst event" that made them realize it was time to bring on someone with deep expertise in scaling companies.
So this question is for those founders, who did bring a COO, VP, or Director of Operations to help them manage and scale the company. When did you know it was time?
In my case companies I joined had:
- Started signing up larger customers, where customer service and service deployment became something they could not just hack it
- Needed to recruit really hard to find talent and do it fast without murdering their culture
- Were in revenue plateau, since founders had no time to go see more customers, spend time on pushing the envelope with the product development, or even attend to mentoring their people
- Overhired and overscaled, so they needed to dial back and start over
P.S. I know on the coasts and in certain tech companies "operations" sometimes gets too narrow of definition (which should be DevOps), so to address that, I have an article "What do operations people do?"
Strategy COO Operations Scaling
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Seems too few experienced users here. Anyway, just to add a point, I was surprised at the way you put the question. I certainly don't have enough experience to tell, but I thought in the case you described the right way to go would rather be to hire a CEO. I wouldn't dare to keep leading the company if I was clueless about the main challenges we face. I think this is a typical point where otherwise successful startups fail, just for the ego of the CEO who is good at building, but sucks at scaling. – Mihaly Borbely 12 years ago
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There was actually a very good article on the CEO subject on TC http://techcrunch.com/2012/11/10/if-when-and-how-to-avoid-hiring-a-ceo/ Worthy read. – Apollo Sinkevicius 12 years ago
1 Answer
There is a related post from Reid Hoffman (Greylock, Linkedin, Paypal) on if/why/how founders should hire an experienced CEO In this article, he references the 20 year practice of bringing in a "grayhair" to run things after the model is validated is starting to lose popularity. Also Ben Horowitz (Andreessen Horowitz) also late in 2012 made a similar point - why we prefer founding CEOs.
In my experience, I have found that there are large gaps between 1) validating the initial concept, 2) validating the business model, and then 3) scaling the validated business model. Many times skills needed to achieve one are not as important in another - and applying the same skills can lead to failure.
Mid step 2 / early 3 is where the COO/ Devops roles / responsibilities become more important: tech decisions in step 1 may need to be re-evaluated, as does operational costs, separation of duties, staffing. Some founders may be better suited / prefer to do operational tasks - others not. Others may not want to consider any other position than CEO. This is the dreaded founders dilemma that every startup founder faces (or is confronted with) - and requires personal introspection on how to approach it.
