Charm Model Opportunity Resources Team Founder Ambiguity Exogenous forces Fits and Gaps Business Plan Uncertainty Capital market context Creativity Leadership Communication Time Growth 05/08/2022 2014lescharm 1
Jan 21, 2015
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Charm Model
Opportunity Resources
Team
Founder
Ambiguity Exogenous forcesFits and Gaps
Business Plan
Uncertainty Capital market context
Creativity Leadership
Communication
Time
Gro
wth
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Growth Rate
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GROWTH RATES
*
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Leadership Responsibilities At Each Stage
Strategic InnovatorChange CatalystOrganization BuilderChief of Culture
Team BuilderCoachPlannerCommunicator
START UP
INITIAL GROWTH
RAPID GROWTH
CONTINUOUS GROWTH
Doer/Decision Maker
DelegatorDirection Setter
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Leader's Ability to Delegate
Changes As You Grow
Leader’s Ability to DoCash
Business Resource
Matching of Business and Personal Goals
People-Quality and DiversityStrategic Planning
Systems and Controls
Critical tothe
Company
Important but
Managed
Modestly Irrelevant
or a Natural
By-product
VALU
TIME
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SUCCESS RATES OF FOUNDERS
Company Age
3 Years 4 Years IPO
% still CEO 50% 40% 25%
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The Rich-vs-King Tradeoff
$10
$9
$8
$7
$6
$5
$4
$3
$2
Gave up bothCEO and
Board Control
Kept CEOPosition Only
Kept BoardControl Only
Kept CEO and Board Control
Shar
e of
com
pany
val
uatio
n $M
)
Older company (n=219)Younger company (n=230)
Noam WassermanAcademy 2006 Best Paper Proceedings
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The Trade-Off Entrepreneurs Make
Well Below Potential Close to Potential
Com
plet
eLi
ttle
Failure Rich
King Exception
Financial Gains
Cont
rol O
ver C
ompa
ny
Noam WassermanThe Founder’s Dilemma
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Going back 15 years, stocks in founder/CEO companies have
surged an average 970% vs. a 222% gain for the S&P
500.