CEO and Co-Founder: Definitions and Key Differences
Updated March 10, 2023
Co-founders and CEOs of an organization both play an important executive role. They're an integral part of a leadership team and help businesses keep to their values, meet goals and expand operations. Knowing the difference between a CEO and a co-founder can help your executive team understand which titles work for which professionals. In this article, we show you what a co-founder is, what a CEO is and highlight some key differences between the two roles.
What is a co-founder?
A co-founder is a member of the executive team who played a role in the founding of a company. This person typically works with other founders to create and launch a business. A co-founder usually shares certain responsibilities with the other co-founders. Sometimes, there is just one founder and co-founder, in which case the executive team decides which of them gets the title of founder and co-founder. A co-founder may be a highly skilled individual who takes an active part in the business after it's founded or someone who helps lead the business and generates ideas for the company's future.
What is a CEO?
A CEO, or chief executive officer, is the acting leader of a business or organization. A CEO takes part in active leadership, talking with management teams and employees, negotiating with other businesses and steering a business towards its goals. CEOs are often founders of a company, but they don't have to be. Sometimes, the founders of a company hire an experienced CEO to help them run the company or steer the company in a different direction.
Read more: What Skills Should a CEO Have?
Can you be a co-founder and a CEO?
It is possible to be both a co-founder and CEO. Here's a brief explanation of how you can adopt a dual title or single title, depending on your position in a company:
If you begin your business journey with a team of founders, you may adopt the title of co-founder so as not to single anyone out as the sole founder of the business. Each of your executive team leaders can carry the title of co-founder alongside other titles.
Co-founder as a title by itself doesn't say much about your skills, but rather simply describes that you played a role in starting the company. Most executives display an additional title, but there are no clear designations, especially for your own business. For example, if you want to be the CEO of the company, you can use the title "Co-Founder and CEO" or "Co-Founder and CFO" to designate that you not only play a lead role in the company but that you also played a lead role in its inception.
If you want to adopt the title of co-founder only, you can, but you might find it challenging to navigate business relationships without an official title like CEO or CFO. This is because investors and other businesses want to know that you play an integral role in the company aside from just assisting with its creation. If you meet with a venture capitalist and tell them you're the co-founder of the business, they might wonder what skills or experience you bring to the job.
Related: How To Find a Business Partner
Differences between co-founder and CEO
Generally, if a CEO does not adopt the title of co-founder, they have vastly different roles within the company. Someone who acts only as a co-founder may have a limited scope of responsibility, whereas a position like CEO requires specific skills, training and experience. With this, here are some key differences between a co-founder and a CEO according to their specific roles:
Generally, the CEO plays a larger role in a company's leadership. A CEO helps run a company and fulfills duties like:
Communicating with other entities, shareholders or companies. The CEO acts as the face of a business, often communicating with stakeholders or investors, government entities and other businesses on behalf of a company's interests.
Creating and maintaining a company vision and goals. The CEO also creates the overall vision and specific goals of a company, ensuring adherence to them. They might draft new values as things change and work closely with management to ensure they encourage those values across a company.
Evaluating the efforts of other leaders within a company and making hiring decisions. The CEO also works closely with the executive team to ensure everyone is meeting expectations and adheres to a company's vision. They also can make hiring decisions for top executive positions within a company.
Assessing and analyzing any business risks. The CEO works with other executives to analyze the overall risk of a company and help mitigate it through training, education and other actions.
Leading the company in short and long-term strategies. The CEO works with a company's other leaders to maintain a company's short and long-term strategies and goals. The CEO is the top role in the company, meaning they make final decisions on company strategy and other business goals if there is no board of directors to answer to.
Read more: How To Be a Good CEO
A co-founder may serve a much different role within a company. Most co-founders assist with company leadership and vision. Though, they rarely participate in other business decisions unless they carry an additional title, such as CFO or COO, or are given a specific role within the business. Some co-founder duties include:
Explaining the company vision to others and maintaining it within a business. Some co-founders help to reinforce a company vision by ensuring it's adhered to at every level of business. They can conduct training or speak with leaders and employees to learn more about how they uphold a company's vision.
Helping with business goals. Some co-founders take an active role in creating goals for a business, working closely with the CEO and other leaders to ensure those goals are realistic and to measure their completion within the desired timeframe.
Encouraging company morale. Some co-founders also help encourage company morale by hosting training sessions, update meetings and taking an active role in developing employees so they feel confident in their positions.
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