It doesn't have to be that way, though. Gale Walker, chief executive of Children of the Rainbow, Inc., a child-care center in San Diego, finds diamonds in the rough among welfare recipients. Half of the 52 employees, like Walker herself, were once on welfare. Walker hires through approved agencies that train in soft skills, such as punctuality. She assigns each welfare hire a mentor and lets employees bring their kids to work. Most workers come from the neighborhood and walk to work. The result: Children of the Rainbow leads to a pot of gold for Walker--more than $1 million in revenues last year. Katherine Catlin of the Catlin Group, co-author of Leading at the Speed of Growth, on leadership:Why do companies outgrow their founders?
Founders get stuck in habits that worked when they started the company. They made all the decisions, did everything themselves. Now they have to build teams, create plans, build an infrastructure. The founder needs to grow faster than the company.How can you tell you're not changing fast enough?
A really great employee might leave, saying they've been micromanaged or the place is in chaos. Maybe you're not able to raise money or you lose a big customer.What are the big psychological hurdles in making the leap from founder to CEO?
One is realizing that everybody does what you say, and watches what you do. I've had clients say, "My gosh, I started a workout program three times a week and now half the company's doing it." Or, "At a meeting last Tuesday I put out some lamebrained idea, and now they've got a proposal to implement it." If you're going to fail as an entrepreneur, you might as well become a star in the process. It helps with the next gig. Just ask Kaleil Isaza Tuzman. As CEO of govWorks.com, which hoped to automate government transactions, Tuzman blew $56 million in venture money, took the company into bankruptcy, and sold it for less than $10 million. A unique tale? No. But Tuzman, 29, is a star in the critically acclaimed art-house documentary Startup.com, so he's a famous failure--and as founder of New York-based turnaround specialists Recognition Group. Now he convinces other entrepreneurs they won't make it either and that they should consider a restructuring. Those who can't do, teach. 39% of small-business owners say we're in a recession31% say we're not in a recession; 21% aren't sure68% of those who say there's a recession think it will end within a year
Data: Cicco & Associates Inc. Small Change
Percentage of small companies that say access to credit is their No. 1 problem: 3%
Data: National Federation of Independent Business