Jason M. LemkinCEO, SaaStr · Co-Founder of SaaStr AI, SaaStr Fund, Adobe Sign

Is It Time to Quit? The Risks of a Failing CEO

18 Nov 2024 · 1 min

Watch on YouTube

0:45

A recorded conversation (YouTube) featuring Jason M. Lemkin discussing whether employees should approach the board about a failing CEO versus quitting. Key claims in this chunk: investors typically 'bet' partially on founders/CEOs (not 100%), swapping CEOs is extremely difficult and rarely succeeds in Lemkin's experience, VCs often write off companies rather than replace CEOs, and replacing CROs is easier than replacing CEOs. The dialog also notes startups usually have multiple founders/seats and that some highly-orchestrated companies (e.g., incubated by VCs) may behave differently.

My CEO is running the company to the ground. Should I go talk to the board?
No, you should quit. You should quit.
This is not the CEO.
Is the.
Bet 50% of the bet. When investors make it's 50% of the bet, it's not a hundred. Yeah. I mean for some folks, inception level betting really early, it's a hundred.
Even though even when it's inception there's.
Still a seat, there's still more than one founder usually. Right. So it's usually multiple people.
But you're.
Betting on the CEO and as difficult it is to change out CROs, it's 10 times harder to swap out CEOs.
It's so risky.
In my personal career, I've never seen it work. I've never seen swapping the CEO work. So most VCs are just going to zero it out.
They've kind of given.
Now listen, there.
Are companies that are.
Highly orchestrated snowflake going through multiple cos because that was incubated at a VC firm.