Lemon #48. Demoting a loyal friend (2nd part)

Lemon #48. Demoting a friend (2nd part)

While reading ‘The hard thing about hard things’ from Ben Horowitz, we learned about how to demote a loyal friend in a startup: 

On the one hand, this can be a good thing – he can help get the new boss up to speed. On the other hand, when mixed with the intense emotions of embarrassment and betrayal, you might end up with a sabotage cocktail. 

An alternative would be to move him to another area of the company where his skills, talent, and knowledge will help. This kind of move will give him a chance to develop a new set of skills and help the company while he’s doing it. For young employees, getting experience in different areas can be highly valuable. 

Once you’ve decided to hire someone above your friend and decided on the alternatives that you’d like to offer him, you can have the conversation. Some keys to doing that: 

  • Use appropriate language. Use phrases like «I’ve decided» rather than «I think» or «I’d like». 
  • Admit reality. Admit that if you were a more experienced CEO, you might be able to develop him into the role, but two people who don’t know what they are doing is a recipe for failure. 
  • Acknowledge the contributions. If you want him to stay in the company, you should say that make it crystal clear that you want to help him develop his career and contribute to the company. Let him know that you appreciate what he’s done  and that your decision results from a forward-looking examination of what the company needs. The best way to do this is to couple the demotion with an increase in the compensation. Doing so will let him know that he’s both appreciated and valued going forward. 

Keep in mind that it is what is is and nothing you can say will change that or stop it from being deeply upsetting. Your goal should not be to take the sting out of it, but to be honest, clear and effective. Your friend may not appreciate that in the moment, but he will appreciate it over time. 

Ben Horowitz @ The hard thing about hard things.

Jorge Moreno

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