Hiring Your Replacement: A Founder’s Playbook for CEO Recruitment

By Matthew Brittain

Here’s a Matthew Brittain, wry workplace-column take on recruiting a CEO to run your own business, with the focus on human awkwardness, organisational reality, and the quietly terrifying moment you realise the company is not you.

Hiring a CEO to run your own business is a bit like deciding to let someone else host Christmas. You may genuinely want the help. You may be exhausted. You may want to sit down for once and drink something that isn’t gone cold by the time you remember it exists. But you also have strong views about how the gravy should be made, who sits where, and whether it is morally acceptable to start playing Wham! before December 15th. So you hand over the plan, then hover in the doorway, offering “helpful suggestions” until everyone would rather cancel the entire holiday than hear you speak again.

This, in miniature, is the founder-CEO transition.

The business case is straightforward. If you want a company that is worth more than the sum of your blood pressure, you need it to function without your constant presence. Banks, buyers and investors are not sentimental. They like predictability. They like repeatable revenue. They like a leadership team that doesn’t require the founder’s personal adrenaline to arrive on time every morning.

A company that can run without you is an asset. A company that can’t is a lifestyle choice.

So far, so sensible.

The emotional case is less tidy. The unspoken truth is that founders often hire a CEO at the exact point where they begin to wonder if the business is still fun. The start-up phase rewards improvisation and irrational optimism. The growing business rewards meetings. A lot of the work becomes about systems, process, and decisions that are so competent and dull that they barely qualify as decisions at all. You might not admit you’re bored. You might just say you’re “thinking strategically”. But the itch is there.

There is also the rather human desire to prove you built something real. The most brutal status test of a founder is whether the company can flourish without them. It is a rare kind of validation, and also a frightening one. Because if the business runs beautifully without you, what does that say about you?

The first question you must answer is what “CEO” means in your particular company.

Many founders think a CEO is a brilliant grown-up who arrives with a PowerPoint deck and rescues everyone from chaos. Some CEOs are like that. Most are much more prosaic. A good CEO is an operating system in human form. They set the cadence. They decide what gets measured. They create the conditions in which competent people can do competent work without continually asking the founder for permission to breathe.

But none of that will happen if you hire a CEO while still insisting on being the CEO.

If you do nothing else, write two documents.

• One is the CEO mandate: what they own.

• The other is the founder mandate: what you will stop doing.

The second one is the one that hurts.

A sensible split in many founder-led SMEs looks like this.

The CEO owns operational reality. The rhythm of the business. The budget. The senior team (with agreed guardrails). The execution of strategy. The quality of delivery. The numbers. The reduction of key-person risk. The day-to-day decisions that, if you are honest, you no longer have the time or patience to handle well.

The founder retains the non-negotiables. The values. The brand promise. The big strategic guardrails. The high-stakes capital decisions. M&A approvals. And, crucially, governance.

In other words, the CEO runs the ship. You decide where the sea monsters are and which ones are worth fighting.

This is also where you should recognise a truth that polite blogs tend to dodge. If your CEO cannot change the leadership team, they are not really the CEO. Equally, if they can change it without any agreed boundaries, you will spend the next year experiencing the corporate equivalent of watching someone redecorate the house while you’re still living in it.

So you do what grown-ups do. You define the boundaries in advance.

Success measures should be boring, strict, and merciful.

Founders often want a CEO scorecard that captures everything: performance, culture, strategy, customer love, employee joy, and the general sense that the CEO is a decent person who texts their mother.

Try a blend of outcomes and leading indicators instead.

Financial performance matters, obviously. Revenue. Margin. Profit. Cash. Forecast accuracy. Working capital discipline. These are the adult metrics. They are also the ones that most quickly reveal whether the business is being run or merely narrated.

Strategic execution matters too. Not as a set of heroic transformations but as a small number of priorities delivered cleanly. If your CEO is doing five revolutions at once, they are probably doing none of them well.

Organisational health should be explicit. CEO success includes building a leadership bench, reducing dependency on single individuals, and making the business less fragile than it was when you personally held the whole thing together with sheer will.

And then there is the metric nobody says out loud: decision quality under ambiguity. You built your company by making halfway-informed decisions quickly and then fixing them on the move. Your CEO needs that same skill, not because they should emulate your chaos, but because growing companies rarely offer the luxury of certainty.

Now to the recruitment bit.

Most of the usual advice is fine: define the role, align expectations, run a structured process, do references properly. But the interesting part is what to look for that isn’t on the LinkedIn checklist.

• Look for someone who asks awkward questions early. This is a good sign. If they can’t challenge you politely in the interview, they won’t challenge the organisation when it matters.

• Look for obsession with operating cadence. The real operators care about how information flows, how decisions are made, how accountability is enforced without melodrama.

• Look for a candidate who can describe a past mistake plainly with no theatre. The kind of leader who can say, “I got that wrong,” is also the kind who is more likely to tell you the truth before a problem becomes a catastrophe.

• Look for “quiet power”. The person who does not need to dominate the room to run it.

• Also look for context readiness. A CEO who has scaled a business with a founder hovering nearby is a different animal from a CEO who has only operated in mature corporates. You want someone who has seen your type of mess before and doesn’t panic when it appears.

Then there is the founder problem.

The biggest risk in this whole arrangement is not a bad CEO. It is a good CEO you won’t let lead.

Founders are often sincere when they say they want to step back. They are less sincere when the stepping back begins to feel like stepping aside. The business might make a decision you wouldn’t have made. The CEO might phrase something differently. The team might start liking the CEO. And suddenly you are in that ancient workplace drama where the founder’s identity collides with the organisation’s need to move on.

So impose rules on yourself.

The simplest is the two-step rule. Before you interfere in an operational decision, ask: is this within the agreed CEO mandate? If it is, let it go unless it breaches ethics, legal risk, or existential strategy.

Stop the shadow org chart. The moment your team can bypass the CEO to get your private approval, you have quietly destroyed the new regime.

Adopt the one voice rule. You debate behind closed doors; you present unity in public. A founder contradicting a CEO in front of the team is not “healthy challenge”. It is a demolition of authority.

And accept the bruising truth that you cannot meaningfully hand over power in a way that feels comfortable. If it feels comfortable, you haven’t handed it over.

You also need rules for the CEO.

They should commit to your non-negotiables on values, brand and risk boundaries. They should produce a clear 90/180/365-day plan. They should agree a timetable for assessing and reshaping the senior team. They should operate a transparent reporting rhythm that minimises surprises.

T

his isn’t about control for control’s sake. It is about trust. Trust is built on early warning systems, not on occasional grand gestures.

What should you watch out for?

The early warning signs are more human than financial.

• Decision latency is a classic. If meetings multiply and decisions evaporate, something is wrong.

• Talent drift is another. If your best people start leaving quietly, that is information.

• Beware the CEO who blames “the culture” for everything. Sometimes culture really is the problem. But it can also be a convenient scapegoat for a lack of operational grip.

• And pay attention to your own behaviour. If you find yourself constantly “rescuing” relationships, smoothing over internal conflicts, or being called by customers and staff because they “just wanted your view”, your transition has not taken.

• Control points are essential, but they must not be suffocating.

• A formal operating rhythm is your friend. Weekly exec check-ins. Monthly performance reviews. Quarterly strategy and risk sessions. Annual budget and long-range planning.

• A blended dashboard that captures financials, pipeline health, customer retention, attrition in critical roles, and major project delivery is better than a hundred ad hoc updates.

• Keep a short, explicit founder veto list. The CEO should not need your approval on routine operational matters. Your veto should be reserved for existential issues: major capital commitments, debt or equity issuance, M&A, brand-risk decisions, and material shifts in business model.
  

Now to money.

Smart packages for CEOs in founder-owned businesses are not just about paying well. They are about aligning the CEO to an outcome that matters to you.

A good structure often includes a solid base, a bonus tied to a small number of measurable outcomes, and a medium-term value plan that makes the CEO care about the next two to three years, not just next quarter.

Equity or phantom equity can be powerful. You don’t have to give away control to create owner psychology. Growth shares above a hurdle, EMI where appropriate, or a transaction-linked bonus can be particularly effective if your endgame includes an eventual sale.

The underappreciated part of a senior package is authority. Great CEOs will trade some money for genuine scope. They want the ability to hire the right people, allocate resources without needless friction, and lead publicly without being undermined by well-meaning founders who can’t resist “just one quick thought”.

Which brings us back to the hardest part: letting go.

Handing your company to a CEO is not a single act. It is a series of small surrenders. You will experience the peculiar discomfort of watching someone else do something you once did instinctively, now done differently, sometimes better, sometimes worse, but always in a way that reminds you that your company has become more than your personal operating style.

This is not a betrayal. It is maturity.

The healthiest outcome is not founder disappearance. It is founder evolution.

You stop being the heroic centre of everything and become the architect of the environment. You focus on governance, strategic relationships, capital planning, and the longer-term positioning of the business.

If you can take a proper holiday without the company turning into a low-grade emergency film starring your inbox, you are getting there.

And if your eventual plan is an exit, you are doing something very commercially attractive. A business with a credible CEO, a strong leadership bench, and low founder dependency is easier to finance, easier to grow, and easier to sell.

Lexis Capital Group paragraph

At Lexis Capital Group, we help founders build companies that are valuable beyond their personal involvement. Recruiting and installing a capable CEO is one of the fastest ways to reduce key-person risk, professionalise governance, and improve exit attractiveness. Buyers and investors consistently favour businesses with strong leadership benches, reliable operating cadence, and proven performance without heavy founder reliance. If you’re planning a partial exit, full sale, or simply want to future-proof the enterprise you’ve built, we can support you with role design, candidate profiling, incentive structures, governance frameworks, and the positioning that turns founder-led success into a sale-ready, investor-grade business.

Footer quotes

“Culture eats strategy for breakfast.” — commonly attributed to Peter Drucker

“The best executive is one who has sense enough to pick good people to do what he wants done.” — Theodore Roosevelt“

I hire people brighter than me and then I get out of their way.” — commonly attributed to leaders including Lee Iacocca

“What gets measured gets managed.” — commonly attributed to Peter Drucker“

Leadership is the capacity to translate vision into reality.” — Warren Bennis“The ability to learn faster than your competitors may be the only sustainable competitive advantage.” — Arie de Geus