How to structure a deal with a new CEO?
I'm a CEO, and I'm wondering how to structure a deal for my first other CEO? The purpose I need another CEO is because I've got my hands full with my own line of products, but I'm an idea guy and have a good idea for another line of products. I'm going for the Sir Richard Branson (of Virgin) look with owning lots of similarly named companies, all run by other CEO's - or "managers". Basically, I'd rather opt for CEO's because these companies are rather technologically advanced and will need some people to run them with lots of power.
What do I need to retain, if the person is overseas and a stranger, but well trusted on LinkedIn just the same. Obviously I don't want to rule by abdication, but get involved with the business.
Here's my ideas:
- Perhaps keep the Bank account in my country, and own it, but offer her a view.
- Own the majority of the company, but offer her royalties on the app she is running.
- Sign an NDA, of course.
- Do the accounting in my country with my CPA.
- Own the Basecamp account.
Any other ideas??
Negotiation Corporate Structure CEO Business Structure Overseas
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A corollary question is how to make her feel comfortable, how not to step on her toes... – Ron 11 years ago
2 Answers
I'm not sure you know what "CEO" means. Its "Chief Executive Officer". There could be only one CEO in a company (although in rare occasions there are "co-CEOs"). What you talk about is a "division manager" of some kind that will report to you but manage a separate line or division of your business.
Otherwise, you misunderstand what a "separate company" means. If you start up a subsidiary in a different country - you cannot require it to use a bank account owned by someone else (you), in a different country (yours) and ran by someone else's CPA. It just doesn't work like that. If you start a subsidiary - you run the board of directors, hire the CEO - and let that CEO open a bank account, hire a CPA and run the business. Because that is her job.
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Thanks... Maybe I wasn't too clear. I'm looking for someone else to be the CEO of a company I startup, coddle for a time, and then hand over. I've been reading Richard Branson's book, "Like a Virgin!" and read today, that he does call his managers CEO's. But I guess you're right - it's not one company... it's more of a brand or conglomerate. And I suppose you're correct too that most CEO's do their own books. But that doesn't mean I can't still "own" the controlling interest in the business. Correct? – Ron 11 years ago
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Owning controlling interest is being the decisive vote on the board. – Littleadv 11 years ago
Patterning after a visionary like Branson is not a strategy...it sound like you are playing Monopoly or Acquire. While business and strategy are "game" founded, I suggest developing your own strategy on how to grow based on the particular needs of each business.
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Sorry, but I don't see why Branson's pattern is not a strategy. It's the strategy of the conglomerate. And if that's what I like - why not? According to the dictionary - Strategy is a plan or maneuver to get ahead. That's what I'm doing... getting ahead!! Each particular business is to be led by their own CEO... that's their goal to move forward each business. Let many people think for themselves. – Ron 11 years ago
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Negotiation Corporate Structure CEO Business Structure Overseas
