There are some investors who are truly great board members.
And then there are the others who shouldn't be on the board.
I came across two instances this week where the board was trying to strong arm the founder CEO.
Case #1 is where the company is pre product-market fit. One of the existing investors is trying to use the new funding round to change the majority required to remove the CEO as part of the shareholder agreement.
Case #2 is where the board members have asked the CEO to resign and believe that bringing in an outside CEO will make the company scale faster. The founder CEO has grown the company to high single digit million ARR with one product; to get to unicorn status the company will likely have to go multi-product.
Firing the founder CEO before product-market fit is a mistake: Pre-PMF, the company is still searching for what works—this is a phase of discovery, not execution. No outsider will have the same level of conviction, adaptability, and founder-led credibility with early customers.
Investors who think a "professional CEO" will magically find PMF are fooling themselves—without a clear market pull, even the best operator is flying blind. Replacing the founder kills momentum, fractures the team, and often leads to a slow, painful death.
Most of the CEOs are coachable, so here is my advice to board members:
Don't be lazy and think that swapping out the CEO will solve a problem. In fact, you have just massively increased the company's risk profile
Instead, do the hard work and help the founders grow.
Or else, just resign from your board duties.
A version of this post was published on LinkedIn in February 2025
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