The transition from entrepreneur to CEO is a challenging yet critical journey for business leaders. Despite the common perception that entrepreneurs may not be well-suited for CEO roles, recent studies highlight the added value of founder-CEOs, with companies being valued 10% higher during IPOs when led by their founders. Drawing from personal experiences in founding and leading Admitad, now under the parent company Mitgo, here are three key lessons for entrepreneurs making this pivotal transition:

1. Recognize the Need for Evolution: Entrepreneurs and CEOs play distinct roles in a company’s life cycle. While entrepreneurs are visionaries who birth groundbreaking ideas, CEOs execute these visions, building the necessary infrastructure for success and scalability. Acknowledging the need for this transition is vital for sustained growth. This realization often comes when entrepreneurial endeavors plateau, signaling the need for a CEO to lead the company to the next stage of development.

2. Cultivate Internal Leadership: As businesses expand, founders must move beyond a hands-on approach and cultivate leaders within the organization. The shift from controlling every detail to empowering leaders at various levels is crucial. Nurturing leaders involves creating a culture that values and fosters leadership qualities. By decentralizing decision-making and trusting leaders, CEOs can focus on strategic scaling, ensuring long-term success.

3. Build a Sustainable Business: Beyond immediate profits, visionary entrepreneurs should prioritize building a sustainable business that outlives their direct involvement. This involves creating a legal foundation for business transferability, paving the way for future leaders. CEOs must establish signposts and clear paths, recognizing the impact of decisions on employees and their families. The goal is to build a company that endures, even in the absence of its founder.

Leadership Qualities of a CEO: While entrepreneurs are innate leaders, assuming the CEO role demands additional leadership qualities. CEOs must acknowledge their limitations, delegate responsibility, and empower teams. Effective communication, accountability for decisions, and adaptability are key attributes. CEOs should foster a culture of innovation, staying ahead of trends, and addressing challenges proactively. Ultimately, the CEO shapes the organization’s future, transitioning from being the nucleus of the team to relying on a capable and empowered leadership team.

In essence, the journey from entrepreneur to CEO is about embracing change, empowering others, and building a business that transcends its founder. By navigating these challenges with resilience and strategic vision, entrepreneurs can successfully evolve into effective CEOs, leaving a lasting impact on their organizations.