Sometime back a wannabe entrepreneur walked up to me, introduced himself, asked about what I am upto and slowly wandered into indirectly asking “Why do you have CEO title, you guys are just too small?“. Probably he had just read articles like this which advocates not to have titles in the startups.
Its true that early in the days, job functions would be too overlapping and everyone might potentially be helping team with every other thing they can possible do. But here why I think you need a CEO, even if you are a 5 person team. (Below is valid if you are working on your stuff full time, and not just teamed up to work on a hobby project)
- You would need it for legal purposes: When you incorporate your entity , you need to define key players in the team as well as your CEO. This guy is responsible for the company and answerable to the board. Term ‘CEO’ could be something else, but you would need to choose someone who is going to officially ‘lead’ the team/company.
- You need a face of your company: You can have anyone of your guy to be face of your company, but then you need someone(hopefully CEO) who can speak to wide variety of audience and can do at least decent job(if not exceptional) pertaining to how things are getting done at company and/or how things are planned and/or doze off a super tricky question asked by a journalist.
- Your potential investor wants a credible contact: Raising money is difficult (if you are not part of the inner circle) and not having someone in the team as its leader (CEO) would send out wrong/confusing signals. Giving them a sense of maturity and making your leader talk to investors/partners would make conversation go much easier.
What is your experience? Why do you think its important to have a CEO for early stage company as well or maybe you think its not needed.
Share your comments below.
