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Profit Dynamics Venture Capital Survey
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Venture Capital Survey
Dealing With A Lack Of CEO Experience
The final question asked is one that entrepreneurs particularly struggle with, "What can entrepreneurs do if they don't have experience as a CEO, or if their management team is not complete?" Although a number of different responses came back, indicating this is a difficult question for the VCs to address as well, the responses broke down into these major categories:
• 40% said: The founder should step aside and bring in an experienced CEO
• 35% said: The founder should ask the venture capitalist for management assistance, or let the venture capitalist recruit a CEO
• 15% said: Assemble a board of directors or an advisory board composed of CEO-type individuals
• 7% said: Have such a winning business model or great idea, that it outweighs any management team deficiencies
• 3% said: Obtain CEO experience before seeking venture capital
It seems Venture Capitalists accept no substitute: 75% specified that the founder should hire a CEO, or step aside and have the VC hire a CEO. While assembling an advisory board is a step in the right direction it won't compensate for the lack of a strong CEO. And only a mere 7% would say they would accept a great business concept in lieu of a quality management team.