Founders have a bad habit of getting replaced once their startups start growing significantly.
Just how prevalent is this practice? According to Harvard Professor Noam Wasserman, author of the new book The Founder’s Dilemmas, approximately 52 percent of all founders don’t make it to the third round of fundraising. So what can a founder do to survive? Reuters writer Connie Loizos shares some insights given by Wasserman during a recent interview. Here are some of the professor’s thoughts:
Equity-related issues are often the root cause of a lot of discontent (and firings). Relinquishing your majority ownership is inadvisable, especially early on in the process, says Wasserman. Make sure to split equity with the future in mind — don’t just default to the idea that it has to be split evenly. For more on how startup founders can improve their odds of not getting fired, read the full article by Loizos.
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If you’re looking for more information on founder life expectancy, read this post. A fired founder isn’t always a bad thing. Check out this post from OpenView that explains the upside of a change at the top.