We administer the Hogan Development Survey to many executives we coach. This assessment identifies derailers—behaviors that emerge under stress, fatigue, or pressure when self-management declines. The Hogan Survey measures eleven such behaviors.
Most leaders we assess exhibit between one and four derailers, which is typical. Everyone has areas for improvement; the key is understanding your own.
Founder CEOs differ significantly. In our experience, we often see seven, eight, or even nine derailers in a single founder’s profile. The most frequent are:
- Moody. Big emotional swings, and everyone around them feels it.
- Cynical. Assumes bad intent; slow to trust.
- Not transparent. Keeps their thinking and their plans to themselves.
- Political. Goes around the chain of command, straight to individual contributors.
- Arrogant. Certain they’re right; dismisses pushback.
- Risk-taking. Tests limits and bets big.
- Dramatic. Needs the spotlight; fills the room.
- Impractical. Big ideas that outrun what can be done.
- Perfectionistic and nitpicky. Nothing is ever quite good enough, down to the smallest detail.
Initially, encountering a founder with most of these derailers seemed unusual. After repeated observations, we recognized the pattern.
These derailers are not flaws in the founder; they often drive their effectiveness.
Why Would a Founder Have More Derailers Than Everyone Else?
Because building a company from the ground up tends to select for these traits.
Think about what a founder must do: believe in an idea nobody else believes in (arrogant, impractical). Bet the company on it before there’s proof (risk-taking). Sell that belief to investors, recruits, and customers on sheer force of personality (dramatic). Pour so much of themselves into it that every win and loss hits hard (moody). Assume every competitor and every term sheet is out to get them, because many are (cynical). Keep their cards close while the plan is still changing every week (not transparent). Walk over to the engineer writing the code instead of waiting for a manager to relay it, because there are no layers yet and speed is everything (political). Hold every detail to their own standard because nobody else is there to catch it (perfectionistic and nitpicky).
Combined, these traits create a leader who pursues what others consider impossible and persists despite contrary evidence.
That’s the profile of a great survival-mode CEO. Survival mode is when the company is under real duress: just launched, burning cash, needing to grow or die, with competitors and incumbents trying to kill it. (Ben Horowitz has a well-known version of this idea: the wartime CEO.) In survival mode, a founder with a stacked derailer profile is exactly who you want in charge.
| Derailer | What it does in survival mode | What it costs in scale mode |
|---|---|---|
| Moody | Intensity and urgency that pull a small team through a crisis | Leaders spend their energy managing the founder’s mood instead of the business |
| Cynical | Healthy paranoia about competitors and bad deals | Distrust of the executives the company now depends on |
| Not transparent | Moves fast without stopping to explain | Nobody knows the real priorities, so rumor fills the gap |
| Political | Knows exactly what’s happening on the front line and gets things done directly | Managers get undercut, individual contributors get conflicting direction, and nobody knows who really decides |
| Arrogant | Unshakeable conviction when nobody else believes | Can’t hear dissent, so the executive team stops offering it |
| Risk-taking | Makes bets incumbents won’t | Makes bets a larger company can’t afford, with legal, regulatory, and reputational exposure |
| Dramatic | Wins the room, the round, the recruit | Makes the company about the founder |
| Impractical | Sees the future before the market does | Strategy outruns what thousands of people can execute |
| Perfectionistic and nitpicky | Nothing ships below the bar | Becomes the bottleneck; leaders stop owning decisions because the founder will redo them anyway |
So What Changes?
The company evolves, but the founder often does not.
If the founder does the job, the company makes it out of survival mode. It finds product-market fit, the revenue becomes real, the headcount goes from 40 to 400 to 4,000. The duress lifts.
This transition does not make operations easy. In scale mode, the company continues to pursue ambitious goals, compete, and remain accountable to its board and possibly public markets. However, the focus shifts from survival to reliable, scalable delivery. Scale mode values predictability: consistent commitments, stable priorities, and decisions that managers can anticipate and execute independently.
At this stage, the founder’s derailers become liabilities. In a small company, volatility is manageable because everyone is close to the decision-making process. In a larger organization, this is no longer feasible.
Consider the political derailer, which founders often overlook. In a small company, direct communication with engineers is efficient. In a large organization, bypassing management undermines authority and creates confusion. When multiplied across all derailers, this behavior leads to shifting priorities, leadership burnout, and the loss of key talent needed for scaling.
This is the common pitfall: founders built for survival mode may continue operating as if the company remains in crisis, creating unnecessary urgency and frequent changes. When stability is required, the organization needs a scale-mode CEO, and boards quickly recognize when this need is unmet.
What Does the Research Say?
The pattern is old enough to have data behind it. Harvard’s Noam Wasserman studied 212 American startups and found that by year three, half the founders were no longer CEO. By year four, only 40% were. Fewer than a quarter led their company through its IPO. His later work across thousands of private companies found that startups where the founder kept control, by staying CEO or holding the board, tended to be valued lower than those where the founder gave some of it up.
Wasserman described this as a choice between wealth and control. We view it as a choice between the leader you are under pressure and the leader the company now requires.
The Cautionary Tales
A note before proceeding: we have not assessed the following founders and are not offering diagnoses. We are highlighting publicly documented behaviors that resemble the derailers described above.
Travis Kalanick, Uber. Risk-taking, arrogant, moody. Kalanick built Uber by treating regulators, taxi incumbents, and conventional wisdom as obstacles to run through. That risk appetite is a big part of why Uber exists. For eight years, it worked spectacularly. Then Uber stopped being a startup fighting for survival and became a global company that needed to be run, and the same behaviors became the problem. In 2017, a federal investigation into software used to evade regulators, Waymo’s trade secrets lawsuit, a former engineer’s public account of harassment and HR inaction, and a video of Kalanick losing his temper with an Uber driver all landed within months. An investigation led by former Attorney General Eric Holder recommended reducing Kalanick’s authority and strengthening board oversight. In June, five major investors sent him a letter asking him to resign, arguing the company’s governance no longer suited a $70 billion business with more than 14,000 employees. He stepped down that week.
A key takeaway from the coverage was that the culture responsible for Uber’s growth ultimately threatened its survival. This encapsulates the impact of derailers.
Adam Neumann, WeWork. Dramatic, impractical, not transparent. Neumann’s charisma and vision took WeWork to a $47 billion private valuation. He sold WeWork as far more than an office company, and private investors bought the story. Then the company filed to go public in 2019, and public-market investors got a close look at what had been out of view: related-party deals, including properties Neumann leased back to the company and a $5.9 million payment for the rights to the word “We,” plus a control structure that gave him outsized voting power. The valuation collapsed in weeks. Neumann stepped down as CEO in September, the IPO was withdrawn, and SoftBank’s rescue valued the company at under $8 billion. The same qualities that made Neumann compelling to private investors made him uninvestable to public ones.
Steve Jobs, Apple. Perfectionistic, nitpicky, arrogant. The redemption version. Jobs’s obsession with detail is legendary, and so were his battles with colleagues who didn’t meet his standard. He was pushed out of his operating role at Apple in 1985 after a boardroom fight he lost. He spent twelve years building NeXT and Pixar, then came back in 1997 as a noticeably different operator. Still demanding, still exacting, but this time surrounded by leaders like Tim Cook who could run the machine. The derailers didn’t disappear. He built a structure around them.
Jack Dorsey, Twitter. Replaced as CEO in 2008, returned in 2015. Another founder who got a second chance after time away from the role.
Google. The version where nobody had to leave. In 2001, Larry Page and Sergey Brin brought in Eric Schmidt as CEO, a move widely described as adding “adult supervision.” The founders stayed, kept their influence on product and vision, and handed the operating machine to someone built for scale mode. A decade later, Page took the CEO role back, with a company that could now absorb him.
The distinction is important: Kalanick and Neumann were removed, while Jobs and Dorsey returned after stepping down. Google’s founders proactively made leadership changes. The success of the transition to scale mode often depends on whether the founder anticipates and manages this shift.
What Does a Founder Who Sees It Coming Actually Do?
One founder we worked with came to us about eighteen months after her company crossed 1,000 employees. Her Hogan profile showed eight of the nine. Her leadership team was turning over, and she couldn’t figure out why good people kept leaving.
We did not attempt to eliminate all derailers, as this is neither practical nor desirable given their contributions. Instead, we implemented three targeted actions.
First, we identified the three derailers causing the most harm at her company’s current scale: political, moody, and perfectionistic/nitpicky. She often communicated directly with engineers and designers, bypassing her VPs. Her frustration was evident to the entire team, and she frequently revised materials her leaders had already approved.
Second, we established guardrails for each derailer. For political: she could communicate with anyone, but all directives were delivered through or alongside the relevant manager. For moody: no strategic changes were implemented without a 72-hour review and discussion with her COO. For perfectionistic and nitpicky: we clarified decision ownership, ensuring she did not revisit decisions delegated to her leaders.
Third, we redefined her role so that the COO assumed responsibility for the company’s operating cadence.
Twelve months later, she remained CEO, and her leadership team had stabilized. According to her board chair, the key difference was that her personality no longer directly impacted the organization.
Actions for Founder CEOs
- Get assessed. Take the Hogan Development Survey or an equivalent, and debrief it with someone who isn’t paid to tell you you’re great.
- Name the three derailers doing the most damage at your current size. Not all of them. Three.
- For each one, write down what it looks like when it fires, who sees it first, and what the guardrail is.
- If you catch yourself going straight to individual contributors, bring their manager along. Every time.
- Hire or empower a true operating partner, and give them real authority over the business cadence, not just a title.
- Bring up the scale-readiness conversation with your board before they bring it up with you.
- Decide, honestly, whether you want to be the CEO of the company this is becoming. It’s a legitimate question, and the answer isn’t always yes.
The Principle Underneath It
The qualities that drive a founder’s success are often the same ones that can create risk. This is not a character flaw, but rather a structural reality.
Founders who successfully transition to scale mode do not fundamentally change who they are. Instead, they understand their own tendencies and build structures that preserve their strengths while mitigating risks.
Survival mode rewards founders who challenge the status quo. Scale mode rewards those who understand the impact of their actions.
If you are interested in assessing whether your leadership strengths may be becoming risks as your company grows, consider completing the free Leadership Readiness & ROI Scorecard. It takes approximately five minutes.
