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Bob Jacobson

Executive swaps make sense. I was part of one. Having led a startup to the door of the investor, I realized it was time to step aside. My disposition and skill is to turn concepts into business models. Although I know how to execute, I'd rather do so on an as-needed basis, helping other CEOs, rather than simply occupying a corner office (or as the case may be, a place in the cubby where files are stored), dealing with the day's minutiae.

But what of the company that doesn't have enough executives to swap? What threshold must the company cross, in terms of completeness of management team, to qualify for investors' attention? How about a really good idea, embodied in a really good invention, with a skillful, determined, but incomplete team behind it?

Speaking for the entrepreneurial class, it seems awfully arbitrary how various investors evaluate and judge these factors. Many times, it seems, a favored technology will be enough to justify an investment, even with just a single champion; while in other cases, a nearly complete team cannot get funded, or gets funded sparsely, despite having everything else in order.

At some point, turning over the reins without having a trusted team in place can make an entrepreneur feel very vulnerable, his or her stake in the company now seeming like little more than ownership of a license. Swap out the CEO too soon, replace him or her with a skilled but visionless senior manager, and everyone ends up with nothing. I've seen it happen. This nightmare can turn real.

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