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How this CEO made the transition from founder to leader

An interview with Annie Flannagan from Better Business Basics

For business founders, one of the hardest parts of their role is transitioning from their hands-on role as a founder to leading the organisation as a CEO. This transition can be incredibly challenging and requires the founder to seriously consider where their strength lies and how they can best lead the business to growth.

One TEC member who has navigated through this transition personally, and helped other founders facing the same challenges, is Annie Flannagan, CEO of Better Business Basics (BBB). Annie sat down with us recently to explain in her experience how other business owners can also transition from founder to leader.

Transitioning from founder to leader
Managing the transition from founder to leader

For many leaders in the first stages of establishing and running their business, the hardest step to take is transitioning from their role as a founder to one where they are leading their people, crafting strategy and funding growth. Throughout 2015, navigating this transition has been a major challenge for Annie.

“Among the biggest challenges for me in the last year has been moving from a small business where it’s all about you, to a leader responsible for a much larger organisation and people’s future – you have their trust in your hand. That’s a pretty wide chasm to jump across,” explains Annie.

Part of the reason for this, according to Annie, is the responsibility that comes with running a small growing business. It becomes less about you, and more about them. Because of this growing complexity, the transition from founder to leader means proactively leading a team of individuals.

At the same time, your mistakes and failure for a CEO becomes incredibly public and can be particularly damaging to both your team and your confidence. For this reason, Annie is adamant that leaders need to access the right skills and knowledge to help them assume the leadership role.

“For me, the journey involved asking; ‘what are the tools I need and who can I ask for help who’s done this?’ TEC was a big part of that journey, getting me across that chasm without any broken bones along the way” says Annie.

“It’s important to understand how you need to change but also what needs to stay the same. That means finding your anchoring points that musn’t change and then deciding what no longer serves the organisation.”

Managing these expectations has been a major focus for Annie. She draws a comparison with the jackets people win at major golf tournaments – some people will feel like they’ve earned that jacket and it fits seamlessly, while others will feel like it doesn’t quite fit and they have to grow into it.

Becoming a leader is incredibly similar. Whether it hails from other people’s expectations or the demands you place on yourself, it takes time, patience and a few bumps along the way to grow into a leadership role and be comfortable with it. The founder’s moment of truth doesn’t always come quickly but often through valuable lessons along the way.

The different types of entrepreneurs

In Annie’s experience, there are three different types of entrepreneurs and each has their individual journey.

The first are those who fit the ‘founder’ category – they have the technical ability to do their job and they do it well. However, they don’t necessarily have the people and managerial skills to lead a growing business and are better off staying as the founder and bringing in someone else to lead the company as a CEO. History is littered with entrepreneurs who hung on far too long.

The second type are those at the opposite end of the spectrum. Entrepreneurs that have the skills, abilities and sense of purpose they need to run a business and keep it growing. These individuals can come with a strong ego, but they are also incredibly selfless and willing to invest in the business long term.

The third type of entrepreneur are those that fall in the middle, they have the potential to lead the business with the right talent supporting them along the way, but are either uncertain of themselves or are still trying to find their own way.

Annie found herself in the third category – knowing that she had a great business idea but was unsure as to whether she personally could scale it to reach its potential.

“People telling you that you can do something is one thing, but it’s only when you get out and prove it for yourself that you can get past this stage,” says Annie. “It requires realistic expectations of yourself, really knowing who you are and absolute honesty with yourself and from others”.

In fact, many of the skills and characteristic of successful entrepreneurs are adversative to the personal and managerial traits required of the leader.

Maintaining momentum

Founders often find themselves forced to make difficult choices about how their company will look in the future. Faced with no clear right answer, owners can easily be paralysed with indecision by trying to control the outcome.

For Annie, just moving forward and building momentum was a major obstacle to overcome.

“The first challenge was just moving. I know that sounds strange for such a self-motivated person, but I spent a lot of the first half of last year terrified of making a move in the wrong direction,” explains Annie.

Founders have to manage a range of expectations that other people place on them – one of the main responsibilities that comes from running a business. By defining what the founder to leadership role involves, can result in enhanced transparency and collaboration across the business.

“My biggest fear was not living up to other people’s expectations and what they expected from me,” says Annie. “A lot of founders are perfectionists by nature, which makes dealing with the possibility of failure difficult. That was certainly one of the first lessons I learnt as a leader; that you’re going to make mistakes – often and quite publicly.”

Importantly, leaders need to be able to bounce back. For every step forward there will be setbacks and obstacles that can be overwhelming.

As an entrepreneur transitions to the leadership role and begins to rely more on others for information and counsel, this is where a mentor can play a key role. Business mentors ask the tough questions and provide a sounding board that allows solutions to surface – shifting a leader’s mindset to work on the business and not in the business.

Finding mentors with experience

Annie is passionate about finding mentors who have already navigated this change and are prepared to provide meaningful feedback.

Part of this means not looking for perfection. For Annie, the best mentors are those who have seen how challenging it can be to build a business and who know what the fear of failure feels like.

“I was looking for people that I call ‘bruisers’ – people who have overcome adversity in order to get to where they are today. These people have stories. They’ve fallen over, grazed their knees and have been shaped positively by these experiences,” says Annie.

This experience tracks back to one of the key aspects of becoming a leader. When you are on your own, failure is easy to forget. However, when you are in a leadership role, failure becomes a public act, one that has to be dealt with up-front and turned into a learning experience.

In Annie’s case, this has meant spending a lot of time researching the nature of vulnerability and learning how leaders feel and use this emotion in a way that builds respect, honesty and a sense of belonging across the business.

While transitioning from being a founder to a leader is something that can be difficult to achieve, Annie’s experience proves it can be done, provided leaders are willing to invest in this process and seek the support of others.