Should Founders be CEOs?

Silicone Valley was where it all started for founder and CEO of Facebook, Mark Zuckerberg; but, now eight years since the website has gone live and after a steadily declining position in the stocks, many have come to question if Mark Zuckerberg is still the correct choice to lead the company. This begs the question: Is the charm of founders-as-CEOs a smart business move or does it “contain just as much potential for disaster as it does for success?” (Businessweek, Ingram) Businessweek author, Matthew Ingram, explores this question, using Facebook as a working example.

What began as a fledgling website in a college dorm room to rate Harvard female students as “hot” and “not” has turned into a billion dollar industry that has defined today’s generation with “wall posts,” chats, photo albums, and messaging. The entrance of Facebook into the stock exchange looked very promising, with expected beginning market value of $100 billion. Yet, the company has come nowhere close to reaching its expected value as it continues to drop and has existing shares of lower than $20. Many critics say Zuckerberg is to blame for the downfall and that the company needs new leadership. Reuters blogger, John Abell, has called for Zuckerberg to resign, “He needs to get out of the way – not because we can judge him a disaster based on a single’s earnings period, but because he isn’t playing to his strength. He’s letting down the average folks who saw something shiny and new, but are now seeing shades of overhyped tech redux.” (Reuters, Abell)

Others, however, such as writer Sarah Lacy argue that founders-as-CEOs have seen much success in the past, such as Apple creator and legend Steve Jobs. Historically, the founder-as-CEO scenarios have gone both ways, some such as Jobs seeing great success, and others such as Yahoo and AOL founders being forced out of their chief executive officer roles when the business has been in crisis. Perhaps these house-name visionaries are not built to last. Without personal ties or stakes held in their companies, a fresh pair of eyes may offer a new perspective, yet this may change the operations and mission of the company with the founder no longer at the helm. Only time will tell if Zuckerberg is pushed to the side by naysayers or if his vision and passion will restore Facebook to its former glory.

One thought on “Should Founders be CEOs?

  1. I agree with you that there are many different outputs with founders as CEOs. There is the possibility that Zuckerberg could be placed elsewhere in the company such COO in which he could be responsible for all of Facebook’s day to day details or even has the head of the R & D department. To force him to resign from the company as a whole would be disastrous however and could come with negative impact in which Facebook could take on a whole new direction that its users may or may not appreciate.

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