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Charm Model

Opportunity Resources

Team

Founder

Ambiguity Exogenous forcesFits and Gaps

Business Plan

Uncertainty Capital market context

Creativity Leadership

Communication

Time

Gro

wth

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Growth Rate

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GROWTH RATES

*

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Leadership Responsibilities At Each Stage

Strategic InnovatorChange CatalystOrganization BuilderChief of Culture

Team BuilderCoachPlannerCommunicator

START UP

INITIAL GROWTH

RAPID GROWTH

CONTINUOUS GROWTH

Doer/Decision Maker

DelegatorDirection Setter

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Leader's Ability to Delegate

Changes As You Grow

Leader’s Ability to DoCash

Business Resource

Matching of Business and Personal Goals

People-Quality and DiversityStrategic Planning

Systems and Controls

Critical tothe

Company

Important but

Managed

Modestly Irrelevant

or a Natural

By-product

VALU

TIME

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SUCCESS RATES OF FOUNDERS

Company Age

3 Years 4 Years IPO

% still CEO 50% 40% 25%

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The Rich-vs-King Tradeoff

$10

$9

$8

$7

$6

$5

$4

$3

$2

Gave up bothCEO and

Board Control

Kept CEOPosition Only

Kept BoardControl Only

Kept CEO and Board Control

Shar

e of

com

pany

val

uatio

n $M

)

Older company (n=219)Younger company (n=230)

Noam WassermanAcademy 2006 Best Paper Proceedings

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The Trade-Off Entrepreneurs Make

Well Below Potential Close to Potential

Com

plet

eLi

ttle

Failure Rich

King Exception

Financial Gains

Cont

rol O

ver C

ompa

ny

Noam WassermanThe Founder’s Dilemma

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Going back 15 years, stocks in founder/CEO companies have

surged an average 970% vs. a 222% gain for the S&P

500.