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When it comes to the co-CEO model, someone remembers the Netflix experience and mentions Oracle. And some people mention Salesforce – a company that implemented the two-CEO model, canceled it, and returned to it. Proponents of the double approach say that two heads are better than one. Opponents believe that the co-CEO model is doomed to failure and that it is a temporary solution only suitable for startups.
During the year, we achieved 155% growth in GGR with the dual model. In this review, I share my experience as co-CEO and highlight the strengths and weaknesses of this management approach.
Why did we switch to the co-CEO model? In 2020, we expected growth and made plans to scale the business. By 2021, the number of employees had grown by 30% and the complexity and capabilities of the technology solutions used in the product have also grown. For example, we have completed development of the Parimatch platform, which can process more than 20,000 transactions per second – four times more than our old platform.
Related: These Co-Founders Insisted on Being Co-CEOs Despite It Costing Them Money
The global plans required a focus on strategic issues while maintaining the pace of growth without compromising the operational quality of the work. This is how the idea of forming the Supervisory Board was born. The purpose of the Supervisory Board was to balance shareholder objectives, enable the C-level to focus on business development strategies and free up management resources from day-to-day operations. Especially since the competence of the employees and the built-in processes made it possible to close cases without the intervention of the CEO.
Our former CEO, and now a member of the Supervisory Board, Sergey Portnov once said: †Every project needs a boost. Pushing an idea is like rolling a rock up a mountain – it requires constant effort. As soon as you are distracted by operational work, the stone will roll back. The whole project turns into Sisyphean labor – which it shouldn’t be.†
When Portnov left the position of CEO and became Chairman of the Supervisory Board, Roman Syrotian and I shared his duties. We had been working in the company for over five years by then and knew our areas well. As we became co-CEOs, we kept our areas: I became responsible for the financial, legal, communications and administrative activities, and Syrotian focused on the IT product and marketing operational activities.
Here are the advantages from multiple CEOs:
Two heads are better than one
Syrotian and I have different life paths, experiences, education, strengths and weaknesses. But we complemented each other, kept our focus areas and didn’t spray on every cog in the company’s mechanism.
While negotiating investments in Cyprus’ IT sector with partners in Limassol, Syrotian in Kiev led the expansion of the Parimatch brand product line and the development of a new platform.
When making difficult decisions, we began to analyze in depth before making a decision or submitting an issue to the Supervisory Board for consideration. It was easier for us to arrange a brainstorm, where you can always ask someone for an opinion. We encouraged each other in demanding decisions or discouraged dubious ventures. It’s possible we lost speed somewhere, but got more reasonable solutions for it. And that is important, because the risks grow with the business.
Related: I’m based in the US, but my co-CEO is in Europe. Here’s how we make it work.
Days are getting longer
We all know the feeling of a lack of hours in a day. Indeed, on one of those late work nights, you thought it would be great to clone yourself and do twice as much.
The co-CEO model does not offer such an opportunity, but the number of working hours for decision-making is increasing. Moreover, unlike a clone, with a good distribution of areas of responsibility you get a better result, because everyone is responsible for their areas of competence.
We even have an inside joke: “Now we can hold parallel meetings in different parts of the world, each with the CEO of Parimatch Tech.” And that’s true, because we make twice as many final decisions.
Deep dive in specific areas
No spraying. You immerse yourself in your responsibilities and develop in them. You then share the knowledge gained through the sieve of your company in general meetings – no unnecessary theory, just the necessary knowledge here and now. Since Syrotian and I have kept our areas of responsibility, which do not directly intersect, we had no controversial points of influence.
Less dependent on one person
Let’s face it – everyone goes through tough times. And when you run a business, business metrics depend on your condition and relationships with colleagues. During these difficult times, your personal issues can delay vital decisions and further affect the business.
If there are two of you, the risks are reduced. In unforeseen circumstances, you can mate or rest and spend time with your family without a permanent work process. There will always be an informed person with experience and authority at the helm.
This is especially true for making subtle decisions related to staffing and reward systems. We paid special attention to these issues and tried to achieve a full mutual understanding, which affected the purity of the decisions made. As a result, the dual approach does not make decisions based on the subjective view of just one person.
Now here are the cons of the co-CEO model:
There are fears that the co-CEO model will blur the line of accountability, creating the risk that business goals will not be met. But for the presentation of the report to shareholders it is not necessary to have one person from whom the result is requested. The dual CEO model also allows you to discuss results, risks and strategies. If shareholders only need one representative, divide this role between you and your partner and work on it.
Syrotian and I were lucky with this. The special thing about Parimatch Tech is that shareholders are involved almost daily in the strategic tasks of the company. We can therefore say that the transition to the co-CEO model has not brought any changes, but has given an impulse to the implementation of the plan. We started communicating even more with shareholders and synchronizing as one team.
Related: Why Co-CEOs Are Almost Always a Bad Idea for Early-Stage Startups
Potential for confusion about roles and responsibilities
It is critical to provide employees with a clear structure to avoid future misunderstandings. Despite the clear instructions, it takes some getting used to that someone else is responsible for a certain development area. It may be a mess at first, but it will probably pass later on.
Lack of speed
There are times when you have to make decisions on the spot and every minute counts. In such cases, with the dual CEO model, you may lack speed in making decisions. It would take extra time to agree with your partner before any major decision. If you have opposing thoughts on the subject, add the time for compromise. All these moves sometimes lead to missed opportunities.
Co-CEO is a temporary model
Indeed, the co-CEO model is used as a temporary solution for corporate restructuring or when companies go through phases of mergers and acquisitions and transformations. In such cases, the model works until these issues are resolved and two CEOs act simultaneously – or the co-CEO model can operate geographically to provide a physical presence in different parts of the world.
But what in this world lasts forever? The co-CEO model is subject to the same risks as the one-CEO model. With the comfortable relationships between CEOs, the competent setting of expectations and the division of responsibilities and powers, the co-CEO model will prove its effectiveness in the future.
Today, the co-CEO model is becoming more and more common – sometimes it’s called a partnership, and sometimes one of the co-CEOs can be the chairman, and so on. This approach is widespread in LLCs, law firms, accounting firms, VCs, and technology and research startups.
If you’re considering moving to the co-CEO model, here are some notes from my experience:
It is critical to follow the common and unified company values - if there are controversial points in the vision, they must be resolved overnight. Otherwise, this will lead to a split in the company.
It is critical to discuss and understand that one of the leaders will not try to “grab the covers”. If there’s a chance it will happen, it will. But even in such a situation, there is a way out. You can follow the Salesforce path – they have CEO #1 and #2.
Forget the multiple CEO model if your company or brand is built on the founder’s personality.
And finally, the co-CEO model could be a temporary solution. You can always switch back to lone leader if it’s a better fit for your business. In the Parimatch Tech case, the war forced us to switch back to the one-CEO model, as we needed to speed up operational and decision-making processes and become more flexible. Syrotian now focuses on corporate strategy as a supervisory director. As for me, the new realities of war and the withdrawal of franchises from Russia have forced business diversification and structural change, so I will be tackling these challenges with my team as CEO.