Raising up staff members early on helps separate the CEO’s profile from the organization’s brand, and eventually leads to a more seamless founder transition. (Photo by Laura Weidman Powers)
Celebrating and lionizing the founders of social impact organizations is common practice in the social sector. There are many prestigious awards for founders and fellowships designed to accelerate their work. There’s even a Forbes 30 Under 30 list dedicated to social entrepreneurs. Starting a nonprofit or social enterprise is hard work, and this kind of recognition and support helps, especially in the early days; it leads to credibility, publicity, and funding. But as the profile of a founder grows over time, it can develop a shadow side. The “heropreneur” narrative of the solo, brilliant founder can eclipse the contributions of a high-performing team, focus media and funder attention on the individual rather than the organization’s impact, and discourage healthy collaboration and transitions.
For a founder like me, who knew I didn’t want to be CEO at the organization I started forever, it took foresight to cultivate my organization’s brand and separate it from my own profile. In 2012, I co-founded the nonprofit Code2040 to create pathways for emerging Black and Latinx tech leaders. In the years that followed, I received a lot of media attention as a leader in the diversity-in-tech movement. I made it onto the 2016 Ebony Power 100 list and The Root 100 list of most influential African Americans. I received a Global Thinker award from Foreign Policy. My work with Code2040 was covered by The New York Times, Forbes, NBC, Bloomberg, Fast Company, Inc., and NPR. This publicity was incredible for the organization; we received credibility and funding as a result. But I also worried that the attention on my leadership might lead to Code2040’s brand becoming synonymous with me. I also knew that while I was deeply passionate about the organization and our work, leading Code2040 was not my forever job, and eventually disentangling myself from it would require careful and deliberate planning and decision-making.
Creating A New Road Map
About five years in to Code2040’s existence, as we were about to embark on a new strategic plan, I took a step back. I thought about what the company needed in order to have its best chance at success and whether I was the best leader to guide it through the next five years. I thought about my skills and strengths, and realized they weren’t a perfect match for the opportunities and challenges ahead. I had a tough choice to make: upskill myself, compensate for my weaknesses, or find a new CEO who had the skills required.
I knew the longer I stayed in the role, the more the “heropreneur” narrative might take hold, and the harder it would be to separate my personal profile from Code2040’s success. Options one and two—upskilling and finding workarounds—risked negatively impacting the organization’s stability and longevity. Option three, however, aligned with my desire to create space for others who might not otherwise get the opportunity to lead. This was a crucial vote in favor for finding a new CEO.
I made the decision to step down in December 2017 and then did what seemed logical at the time: research. I sought out resources and articles on founder transitions and how to plan them well. But there was very little out there, especially for circumstances like mine. I took some ideas from what I did find, but there was no real road map for founders 5 to 7 years in who weren’t looking to stay on for a similar length of time. I wanted to move much more quickly and had a range of unanswered questions. Beyond the mechanics of a succession, for example, founders of young and often less-stable organizations must contemplate more-existential questions: Will the organization even survive without its founder? Does the answer depend on how closely its brand is tied to the profile of the CEO? What steps can founders take to separate the two, and set the organization up for growth and success?
And so we stepped into the unknown. I had a baby on the way, and the person I hoped would be my successor—Karla Monterroso, then-vice president of programs—was lined up to be acting CEO while I was on parental leave. I had a conversation with Karla in December to tell her my plans to leave and my hope for her to succeed me. I also suggested, if she agreed, that it would be smoothest for the organization if she could move seamlessly from acting to actual CEO, without my taking the reins back in between. I then discussed this with our board chair, and in January, talked to the rest of the board members. They were already familiar with Karla’s work and leadership, as she had been a fixture at board meetings for years, and after interviewing Karla and understanding her vision for the organization and true potential as a leader, they approved her appointment as CEO in March.
The next three weeks entailed mapping out a comprehensive internal and external communications plan, then putting the plan into motion. We spent a week and a half organizing team meetings, targeting outreach to dozens of donors and longtime supporters, and sharing a news story that lifted up Karla and her new role. In April 2018, I formally stepped down as CEO. I stayed on staff through June as an advisor but reported to Karla not the board.
Setting Up Your Successor for Success
Several factors allowed me to work with the board to appoint a new CEO and transition out in seven months. Although this scenario or timeline won’t apply to or be possible for all founders, I hope these three lessons will:
1. Make space for other leaders early on. Three years into running Code2040—and three years in advance of stepping down—I began to make specific, thoughtful, diligent efforts to lift the profiles of other folks at the organization along with my own. Most employees at Code2040 underwent media training so that a wide variety of people from all levels of the organization were equipped to represent the organization at any given time. Staff members spoke at local and national conferences, gave quotes to reporters in media interviews, and represented the organization at industry events. This strategy increased the perception of our organization as “leader-full,” and gradually pulled apart the organization’s brand and my own profile as a leader.
As I noted earlier, this mindset served the organization extremely well during the CEO transition. I didn’t have to formally introduce Karla to the board, funders, or constituents; they already knew and loved her. There were other benefits to the organization too. For example, I had been invited to annual Fortune Brainstorm Tech conference for several years and often had a speaking role. When we told the event organizers about the transition, they politely but firmly uninvited me and invited Karla instead. While I would miss the annual trip to Aspen, it was exactly what I hoped would happen—that our supporters would care more about the organization and its impact than about me as a leader.
2. Once a successor is in place, step back. Once Karla and the board decided to move forward with the transition, I turned my focus to our team. People who’d witnessed other founder transitions told me it’s not just the CEO who leaves; they said to expect 30–40 percent staff turnover within a year. I encouraged all staff to take on more leadership, visibility, and responsibility. The same way you need to be diligent about spreading the spotlight externally, you need to do it internally. By the time I left, there were probably as many Karla loyalists as there were Laura ones, plus lots of other emerging leaders.
From the moment Karla officially took the helm, even while I was still on staff, I stepped back in every way possible. I no longer led team meetings and was careful to redirect every question about the organization to Karla without speculating what she would or should say. Going from CEO to second fiddle overnight requires a willingness to set ego aside—and a total commitment to stepping out of the spotlight and supporting the production from the wings.
3. Prepare for the unexpected. After contacting our donors, partners, and supporters with the news, we received generally positive and excited responses to Karla’s promotion. However, about 20 percent of the partners we spoke to on the phone were supportive upfront, but then either pulled support down the line or made Karla re-apply for funding. While the organization was in a healthy position financially, in retrospect, we were overly optimistic about the financial impact of the transition. Our standard runway (the cash we had in the bank at all times) and pre-commitments (pledged revenue) that felt comfortable for me—a more-tenured CEO—felt barely sufficient for a newly instated one. Because of this, I recommend departing founders have either at least a full year's budget pre-funded at the time of transition or a plan to working with a smaller budget the next year.
Internally, I wasn’t prepared for how emotional I would be when I made the announcement to our staff. I had poured so much into Code2040, and leaving was bittersweet. I was proud, excited, and sad all at once. The whirlwind of emotions caught me off guard, but they included great admiration for Karla, and a confidence that Code2040 could live on and thrive without me under her leadership. Focusing on that belief in Karla helped me feel at peace with the choice to move on from the organization and my role.
These three lessons were particularly important to me as a founder who experienced some of the glory the social sector has to offer entrepreneurs, and who wanted the organization I co-founded to eventually succeed without me. I encourage all founders to continually examine their commitment to their roles while intentionally fostering leadership in others. Especially contextualized within the lack of equal opportunity among nonprofit and social enterprise leaders, we need to make room for more underrepresented leaders to sit at the helm of impact organizations. Doing that means stepping aside when it makes sense—even when there’s no road map and when the unexpected is bound to come.
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Read more stories by Laura Weidman Powers.