Why are Founding CEOs Stepping Down From Their Posts?
This month saw the Founding CEOs of two major e-commerce companies vacate their spots at the top of the proverbial food chain. Both Sophia Amoruso of Nasty Gal and Eric Kroger of ModCloth made the move. The question is why?
The similarity in both cases would be dipping sales + lay offs. Although last year Amoruso successfully published her book #girlboss, Nasty Gal also was forced to lay off 10% of its staff. In the case of Mod Cloth, the Ecomm superstar who was able to put up considerable YOY growth since its launch in 2002, its wildfire success has recently plateaued. Working with a development team of only half a dozen, ModCloth was forced to lay off 15% of its workforce, after it had already laid off 70 people before Oct 2014.
While the product selection of these two companies might be vastly different, one thing remains the same; both founders + former CEOs agree, they've hit a plateau. Both Kroger and Amoruso have acquiesced to the fact that they might no longer be the most appropriate fit to drive their businesses further and have handed the reigns to more seasoned retail executives who will now focus on operations and margins.
We give a big High Five to any entrepreneur who has such clarity in vision. They see that in order for their companies continue to grow AND take care of their loyal employees, sometimes it’s best to let others take the helm.
Image Credits: Business of Fashion