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It's probably worth stressing that Open AI has a very unusual ownership and government structure that left Sam very vulnerable to this sort of board action - no
by wolframhempel 3y ago
It's probably worth stressing that Open AI has a very unusual ownership and government structure that left Sam very vulnerable to this sort of board action - not just from a legal point of view, but from a fundamental conflict of interest one. After all, being the CEO of the SaaS offering with the fastest growing revenue ever (AFAIK) is inherently in conflict with a board that still believes its running a non-profit organisation.
Having said that, there are any number of examples, from Uber's Travis Kalanick to Andrew Mason (Groupon), Jerry Yang (Yahoo) to - probably most famously - Steve Jobs from Apple.
For founders, there's only really two ways to absolutely ensure to stay in control:
- Retain 50%+1 of the business
- Decouple monetary ownership from voting rights by having multiple share classes, then ensure you own 50% of the voting rights class
It might also be helpful to:
- Be indispensable. This should be a given if you're the founder/CEO, but if you feel there's a potential revolt brewing, there's some Machiavellian stuff you can do, e.g. by ensuring only you personally have some key relationships or- as Adam Newman at WeWork showed - by e.g. personally owning a lot of the real estate. (Not that that helped in the long run)
- Play board politics. Ensure that you control (on a social and relationship level) a fraction of the board that adds up to 50%+
But ultimately, there's a different question: Yes, it's your baby and of course you should be the first one to run it. But why does your board think you shouldn't? Removing a Founder-CEO comes with very high risk, makes the VC fund look bad (if your board is composed of VCs) and will bring a lot of chaos to the company. So - what's so problematic about you that people feel compelled to consider it? Or maybe there's nothing problematic per se, but you're a great product-market-fit finder and growth CEO, but now it's a large company and it requires another set of talents? Would it really be so bad to do the Google/Eric Schmidt playbook and let someone else run things while you do what you enjoy the most, e.g. heading product? Or become an executive chair person that spends most of their days travelling between Tuscan vineyards?