OpenAI co-founder Greg Brockman is leaving, too::OpenAI co-founder Greg Brockman announced that he’s quitting just hours after CEO Sam Altman was fired. OpenAI chief technology officer Mira Murati is taking over as interim CEO.
OpenAI co-founder Greg Brockman is leaving, too::OpenAI co-founder Greg Brockman announced that he’s quitting just hours after CEO Sam Altman was fired. OpenAI chief technology officer Mira Murati is taking over as interim CEO.
Seen this story time and time again. “Founder of company kicked out of own business they created”. Why does this happen so often?
When you go public its not really your company anymore, its shareholders company.
That doesn’t really answer my question though. Why would anyone kick out the people responsible for creating the business in the first place? The people who imagined and thrust the business into life and massive success? Seems like they would be valuable people to shareholders…
They are invariably, actually, not very valuable at all beyond the fruition. Take a look at any Forbes or FT top 100 list and see how many of those companies are being run by founders.
Companies go through a lifecycle of change before they reach anything resembling stability or a pace of business that isn’t completely volatile the people in it. During that time the types of people that the business need to achieve the goals of that lifecycle stage are very different.
Steve Jobs types, on the other hand, are actually extremely rare and the exception rather than the rule.
This is still not answering my question of “why?”
Because it requires a completely different skill set to run a startup with only yourself and 50 employees to worry about vs a multi-billion dollar, publicly traded company. People that are good at one of those often aren’t good at the other, so when their company changes from the former to the latter, they get the boot for someone better at running the new version of the company.
Sure, that’s why you bring on other people with those skillsets to fill those roles. Doesn’t mean you have to remove the people who pioneered the company? The “vision”, so to speak. The people who understood what it took to make the company what it is in the first place? I mean look at what happened when they ousted Jobs.
Apple is now the most valuable company on earth, so I think you’re not making the point you think you’re making. Publicly traded companies act only based on what increases the value of their shares the most. If the current CEO isn’t seen as the most profitable CEO for the shareholders, they will eventually be replaced, even if they founded the company. That is a risk you knowingly take when taking your company public. Most founders choose the money that comes with an IPO, knowing they’ll eventually get the boot.
I think you’re just not as familiar with Apple as you think you are. They ousted Jobs very early on and the company subsequently floundered badly. Then they brought him back and then took off like a rocket again to become the monolith they are today (even though he passed some time ago now).
It unfortunately often does. It’s hard for the original founders to “let go” and some of the things that were idiosyncrasies at the scale of 10 are actively detrimental to people’s careers and the business’ wider growth when you’re 1000. Experienced founders often recognise when it’s time to hire the “VP Eng” that’ll replace them, but if it’s their first big go at it, they often cling on a bit longer that they should.
It was this bit
Founders are big thinkers and risk takers. When a company has found success, the owners prefer to focus on scaling that value rather than doubling or tripling down on the next big thing but the founders often want to keep betting it all.
Put another way, if you bet 100 and have turned it into 1,000,000 would you want to get your money out or play roulette?
It’s not a matter of reward or punishment. It’s a matter of the skills required for continued success.
Early startups require big risk-taking, progressing at an absurd speed, charisma to get investor capital, and really just being a little crazy.
Once the concept is proven to be viable and potentially profitable, the focus needs to shift from proving it can work to making it sustainable. This involves less risk, process improvements to avoid issues like getting sued, better money management, more careful time management to avoid burnout of non-founder employees, and generally just being more rational about things.
It’s rare that a person can exhibit both of these sets of behaviors, so companies will often swap out the former for the latter as a company matures. If they didn’t, the founders might unintentionally drive the company into the ground by taking unnecessary risks after finding something that already works.
Does that answer your question, or did I miss the mark, still?
Generally the type of people who make good founders have to be dreamers to believe that their crazy idea not only can work but can change the world.
These people do not make good leaders as the company matures, as it now needs certainty for investors and detailed plans and structure instead of moonshot fantasies.
The same traits that make them good founders also make it difficult for them to let go of their position, or recognize that they should transition control to a better suited candidate, so often they must be removed by the board.
Source: Software Engineer in a tech startup
I’ve worked at tech startups and I’ve always hated seeing the good founders removed. It feels like such a scummy, sterile move. The board doesn’t care that the founder/s did a nearly insurmountable amount of work to elevate the company and would rather have some career CEO take over so they can maximize profits rather than do right by the company. It’s a perversion of the company’s original values and people all so that some rich assholes can make more money.
Capitalism is all about perverse incentives. It’s unavoidable
So after the company becomes successful, they need to stop coming up with new ideas? A tech company? Like, I get it but I don’t get it. Why do investors want that? Why would anyone want that? You can filter their creative input without indulging their every whim.
It’s like the bands that create amazing and unique music and become super popular based on said music, then their next album sounds like every other “pop” band in existence. Like what are people even buying at that point?
I’m by no means saying that they have no further role in the company, and you are absolutely correct that these companies need to continue to innovate. This is why I mentioned transitioning control to a better candidate, because the role of the CEO changes as the company matures.
Smart founders should find a way to continue to play into their strengths instead of clinging to the highest title, otherwise they will always need to be removed.
Basically why Larry Page and Sergey Brin had Eric Schmidt become their CEO. He could do all the business stuff while they focused on doing whatever moonshots they wanted
Erin Schmidt is the one who turned Google into the shitty company that had to remove their “Don’t be evil” policy.
I remember when this scandal came out: https://www.wired.com/2012/05/google-wifi-fcc-investigation/
I watched the press event when Larry Page (obviously not knowing what was going on) promised that they will immediately delete all the sniffed data, then Eric came, took the mic and corrected: “We will delete the data once we receive the court order that forces us to do”.