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A Summary of

Why Founders Fail: The Product CEO Paradox

by
Ben Horowitz
a16z
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There are three main reasons why founders fail to run the companies they created: the founder doesn’t want to be the CEO, the board panics, and the Product CEO Paradox.

The Product CEO Paradox

  • A founder develops a breakthrough idea and starts a company to build it
  • They work tirelessly to bring it to life by involving themselves in every detail of the product
  • The size of the company grows to a point that the CEO cannot be involved at the same level of detail
  • The board advises them to delegate
  • The product-oriented CEO turns into an ineffective CEO

How to Prevent This

  • Reduce the level of involvement in product decisions, but maintain essential involvement
    • Keep and drive the product vision
    • Maintain the quality standard
    • Be the integrator
    • Make people consider the data they don’t have
  • Transition from being intimately involved, to a process that allows them to make their contribution
    • Write it; don’t say it
    • Formalize and attend product reviews
    • Don’t communicate direction outside of the formal mechanisms
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