[Matrix Moments] What is the difference between a founder and a CEO?

In this week’s Matrix Moments, Avnish Bajaj, Founder and Managing Partner, Matrix Partners India, talks about the differences between a founder and a CEO.
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The technical difference between a founder and a CEO is quite simple — a founder is someone who starts or launches a business, and a CEO is someone who takes the company to scale. The CEO role is the highest-ranking executive roles in any organisation. Simply put, founders hustle and set up their company, while CEOs work on day-to-day nitty-gritties and take it to the next level. 

And it becomes important to bring in that distinction as companies scale. Many founders are either able to make that transition into a CEO, or not, depending on how they have evolved and skilled themselves along with the company. 

There have been several instances historically where professional CEOs have replaced founders — Uber, Flipkart, and many others. This however does not mean that founders cannot be CEOs. 

Explaining the difference, Avnish Bajaj, Founder and Managing Partner, Matrix Partners India, recently said during the Matrix Moments podcast, 

“There is a big difference between the two. From personal experience, after Baazee, I started thinking about it and I remember reading somewhere that that there are three levels — Manager, CEO, and an Entrepreneur. It said - a good Manager is given a set of goals and a set of resources and is able to harness those resources towards those goals.”

Avnish Bajaj, Co-Founder, Managing Director and Managing Partner at Matrix Partners India

Whereas, he further explained, a CEO is brought into an organisation, is given the resources and top-down targets, and he then generates the goals and sets out to achieve them. 

“Entrepreneurs - they start with a goal and then generate the resources. We talk about hustle, at Matrix we define hustle as hard work and resourcefulness. I think one of the biggest differences between a CEO, entrepreneur or manager is in their thinking,” says Avnish. 

He further says that the thinking of an entrepreneur or a founder is not limited by resources. They generate the resources for their goals, so resourcefulness is that one quality that entrepreneurs are infinitely better at than the rest,” said Avnish. 

Entrepreneurship is about vision, and also about launching, designing and managing the initial hustle. Taking the next tangible step from zero to stage one is the job of the CEO. 

Listen to the podcast here

Edited by Anju Narayanan

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