How does Co-CEO work?
What Startup Founders and CEOs Need To Know
As a start-up, you may have only one person in charge of your company. You are the CEO and everything revolves around you.
But as your company grows, there is a need for more than one person to run it.
You may need someone to take care of sales and marketing, or you may need someone to take care of the finance side of things.
As the company grows bigger, it needs to become more organized and that is where co-CEOs come in.
But having two CEOs in a company can create problems as well as work out great for the company.
Before we go into the details of how co-CEOs work, let’s look at why companies choose to go with this arrangement.
There are three main reasons why a company chooses to have two CEOs:
1. Better Management Of The Company
Having two people working together on one project can lead to better results than having just one person do all the work.
Having more than one person looking at a project from different angles can help in decision making and problem solving.
This can lead to better management of the company and an increase in productivity for all employees involved with that project or area of business activity.
2. Avoiding A Conflict Of Interest Issues In Businesses
Many start-ups have two co-founders who started out working together from day one, right from the idea stage until they built their first prototype product or service (or even till they raised funds).
So it is easy for these two co-founders to get into conflicts because they are spending every waking moment together and don’t have anyone else around them who can tell them when they are wrong or getting too emotional about something.
So what happens is that sometimes these co-founders clash with each other over petty issues and eventually this leads to fighting over bigger issues like how much equity each founder should own in the business or how decisions should be made etc.
This is why many businesses with two co-founders hire a third CEO so that there is someone else who has equal rights as them but also has enough authority within the business structure so that he/she can resolve any conflict between founders when it arises before it escalates into something bigger which could end up destroying their friendship forever or their business relationship forever!
It also ensures that no matter what happens between these founders later on, there will always be an impartial third party present who can step in and solve the problem.
3. Help The Company Deal With Its Business Growth
It is possible that as your company grows, you may need to hire more people and so you may need to give someone else the responsibility of hiring people.
It is also possible that you may need to hire more than one person for a certain position and so you may need someone else to oversee that department or area of business activity.
It is also possible that you will be spending more time on marketing or sales activities than product development and therefore you will need someone else to take care of product development and someone else for marketing.
As your company grows, it needs to be organized properly and this can only happen if there are multiple CEOs running different departments or areas of business activity within the company.
Now that we have seen why a company might want to have two CEOs, let’s look at how co-CEOs work in an organization.
A co-CEO basically shares all the responsibilities with another CEO except for making final decisions which is left to one CEO who has more authority than the other CEO(s).
All decisions are made jointly by both CEOs but the final decision lies with one CEO who takes care of all the operational aspects of running the business including hiring new employees, spending money on marketing etc.
He/she also oversees all departments or areas of business activity within the company which he/she has been given responsibility for by both co-CEOs as well as by senior management within the company.
The other CEO looks after everything else like dealing with customer service issues, dealing with complaints from customers etc., looking after staff management issues etc., doing research about future business opportunities etc., looking after any legal issues which arise within the company etc., managing their own team(s) within their department(s) and taking care of everything else needed for running their part of the business smoothly.
This division of responsibilities can be done however both co-CEOs want it, but they should try not to overlap too much when it comes to different areas of responsibility so that they don’t get into conflicts with each other over small things.
Therefore, having two CEOs can help keep your business organized no matter how big it gets.
Regards,
Alexander
About the Author
I am the Founder of Cudy Technologies (www.cudy.co), a full-stack EdTech startup helping teachers and students teach and learn better. I am also a mentor and angel investor in other Startups of my other interests (Proptech, Fintech, HRtech, Ride-hailing, C2C marketplaces and SaaS). You can also find me on Cudy for early-stage Startup Founder mentorship and advice.
You can connect with me on Linkedin (https://www.linkedin.com/in/alexanderlhk) and let me know that you are a reader of my Medium posts in your invitation message.
