I'm a terrible leader

John came in and I could tell right away something was wrong because his head was down and he was not standing up straight. He was reluctant to talk when I asked what was wrong, but eventually told me we lost all our shelf space at the XYZ chain of stores. Our competitors now have that space. He said the competitors offered the buyer a better deal and extended payment terms.

When I asked why no one told me, he said because everyone knows I don’t like to hear bad news and will yell at the person who tells me something I don’t like. I started yelling at them immediately, telling them what idiots they are and that they should have told me. There was nothing to do now and I have would have to fire people. By not telling me, they hurt the business. I spend every waking hour doing things for them and they betrayed me.

A trusted advisor told me I wasn't a strong leader and needed better people

I’ve been turned down by eight potential investors. It is me or the business? I was getting depressed and thought I should stop. I didn’t know how to make sense of what was happening to me. The investors were so aggressive. They wanted me to make mistakes. They just seem like nasty people.

My sister’s husband is an investor and I went to get his advice. He said it was part of the game to ask hard questions. Investors also want to see how you stood up to stress and adversity. He said he would come to our office to meet the team. When he came to see us he asked everyone questions about the business. He asked for data on customers and competitors.

At the end of the day, we sat down together to review his day. He said he wasn’t impressed by the team or their knowledge of the business and the market. He thought they were all nice people but didn’t have the skills to grow the business. Few understood the business model. Above all, he said they lack passion for the business. Then he said it was my fault for choosing weak people and not educating or communicating with them. Great leaders hire great people. Good entrepreneurs hire people that can scale the company to new levels.

He then asked me about the business plan. He listened to my answers then said I didn’t understand the business and couldn’t explain the operations or its economics in simple terms. He said he wouldn’t invest in me or my business because I couldn’t determine the size of the addressable market, the intensity of competition, or how to differentiate ourselves.

He told me this was real life, not a business plan competition. He said in order to be successful, I need better people, a stronger board, and better results. He said no one would invest in me or the business if I didn’t make these changes.

It seemed like an advisor wanted to take over the business

Andrew has always been my advisor and friend. He had a long career in business and retired three years ago. He seemed to enjoy helping us and always had good advice. He was on the board of several companies and also travelled a lot. But, one day he said he would like to be more involved in the business. He had some free time and wanted to help us.

Andrew started coming into the office three days a week. He spent a lot of time to talking to everyone and began to get involved in day-to-day decision-making. He wanted a desk in the office. He had business cards printed showing him as an Advisor to our business.

One day Andrew sat down and said he wanted to join the Board. What he said that day and the way that he said it scared me. He seemed to me he wanted to run the business, to take it over.

I talked to other people in the team and they said Andrew was questioning my ability to run the business. He was inserting himself in the day-to-day operations. Everyone said they felt uncomfortable around him. Some said he was just bored and wanted to get back into the action. Rather that offering Andrew a Board seat, I asked him not to come into the company any more. We appreciated his contribution but we were growing up. Andrew was shocked and very angry. He walked out the door and I never saw him again.

My co-founder was arrested for drunk driving for the fourth time. What can I do?

This was the fourth time my co-founder was arrested for drunk driving. This time his license was taken away and his picture was in the local paper. He was responsible for sales and this meant he did a lot of entertaining and tended to drink too much. We discussed this many times and each time he promised to stop. I am now at the stage where I don’t trust him any more.

There are only two of us on the Board, but I had our lawyer write him a letter saying any repetition of this behavior would result in instant dismissal and forfeiture of all his stock options and incentives. We barely talk to each other now but what else could I have done?

We didn't know enough about technology to manage our website development

We built our first website ourselves. It looked really cool and was informative. It couldn’t accept payments but that didn’t matter as we used mobile banking. It wasn’t very stable and would crash every now and then. But it was cheap.

As the business grew, we needed our website to do more. We wanted to know how people navigated the site and we wanted to introduce live chat so we could deal with service issues. We had $5000 to spend and eventually found a company in Russia that would do the work.

From the start it was obvious to me that we didn’t have the skills to manage the project, even though it was small. They kept asking do you want to do XYZ and we would say yes.

This first invoice came in and it was already $3750 and we weren’t even half way through. We questioned them and they said it was what we asked for and approved. Moreover, they built it into the site and it would cost more to take it out.

The second bill was for $8000 and there was more to come. We ended up spending $15K. Then we had to pay to support the site. This was $450 per month for a limited number of hours of development. We now have a list of over 45 things we need done and aren’t sure how we’re going to pay for all of it.


My staff were hiding the poor customer feedback from me

We started getting customer feedback by putting cards in the product and calling them directly. The feedback wasn’t good. People said the product didn’t live up to their expectations. They said customer service was poor and it often took a week to get a reply. Some said our staff were rude. The phone survey and the cards showed the same pattern.

The team questioned the research method. They said they didn’t get any complaints, that they reviewed every customer letter and monitored response times. I decided to do two things: read all the comment cards and call customers myself. What I read and heard was deeply disturbing. My team wasn’t telling me the truth. They were hiding real problems we had with our customers.

I gathered everyone together and told them what I found. I told them that from now on every problem should be brought to my attention. I also told them every product would have a survey card with my name and telephone number on it so that I would know what was really going on. If we start a company based on hiding data, rejecting market feedback, and ignoring facts, our business is doomed.

As my public profile grew, I had less responsibility running the business

Our business was featured in a major newspaper and then our products won a international award for the best educational platform. We were all proud of our achievements. Speaking invitations started to come in and I thought this would be great for publicity.

The next thing I knew, I was travelling four months a year to speak at conferences and universities. I really enjoyed all the new people I was meeting and I thought I was doing a lot of good for the business. The more I travelled, the easier it was to raise money. We recruited over 40 new people and won two major government contracts. When I was home, I still acted as the CEO, but I had more and more trouble inserting myself back into the business. So much was happening when I was away that it took a lot of time to catch up. There were new people in the company I hadn’t met and new customers I didn’t know.

The COO was now running the company and I was distant from the day to-day operations. At one of the quarterly Board Meetings I was asked to step down as CEO and become Chairman. I don’t know how I feel about this but I wish it had been my choice to make.

There was a lot of change when the investors replaced the Founder with a new CEO

The new CEO is very smart and had a good education but doesn’t have a clue about how to run a business. The new investors replaced the founder in order to allow the business to grow. The founder was bored by the day-to-day and had a new business idea.

We’ve been working in an open plan co-working space, but the new CEO insisted we also get an office. He also wanted to get a receptionist/bookkeeper. He commissioned an agency to look at our logo and branding. This alone was going to cost $12K, which is more than we had spent on anything so far.

What seemed like trivial expenditure to him seemed like a fortune to the rest of us. He also wanted us to do an 18-month rolling cash flow forecasting. None of us really knew how to do this and it took a lot of time. He would call a meeting to review it and this would take more time. None of us were sure what we suppose to learn from this.

He kept telling us these were things we needed to do to grow. But we were only 18 months old, our cash position was marginal, and we were barely coping with our day-to-day obligations.

No matter what we said, the new CEO refused to engage in the daily operations. We needed help and all we had was more things to do. It is OK to add new things, but surely we should stop doing some other things.

Even though I started the company, maybe I'm not cut out to be a manager

Managing a team is a pain in the ass. Everyone is so self-centered and needy. It takes all the energy out of me. As the company grows it is becoming more difficult to get people to work together. Why should I be spending my time on this? I should be out getting more business.

Yesterday a team member resigned. She was the first person to leave the company. She said it had nothing to do with money or status. She loved the product couldn’t work with a dysfunctional team and leader.

It wasn’t fun to come to work. There was no clear direction. Priorities changed day-to-day and people didn’t support one another. She looked me straight in the eyes and said there is no leadership. She told me I was in over my head and didn’t realize it.

Did I know, she asked, that I had not spoken to her in three months and there are only 15 people in the company? Did I know her mother had died? Did I care? I told her this was not intentional and I was sorry. She said that was the problem.

 

My first hire was negatively affecting staff morale

As CEO of my business, Mary was my first hire and we have been through a lot together. We were very close but as the business and team have grown, we do not spend as much time together.

Last week the team decided that the new software program would go live at the end of the month. Mary did not agree with the decision. She didn’t listen to anyone even though software is not her area of expertise. She argued with everyone. She kept saying she was the first employee and she knew what was right.

I could not get her to see reason. Eventually we had a personal discussion. She told me she no longer trusted me and that I had broken all my promises to her. I simply could not deal with her. Later, I was approached by several members of the team who said it was becoming more and more difficult to work with Mary.