Stressing Out in the Startup World

The SEO sector is not a typical environment for multi-million dollar, venture-backed software firms. Generally, SEO is seen as a consulting service, which is notoriously hard to scale. While Moz began as a consulting firm, Rand and his team developed software that enabled companies to enhance their online presence.

This innovation allowed Moz to adopt a B2B subscription model that scaled surprisingly well. They secured their first funding round of $1.1 million in 2007, and by 2017, Moz was generating $50 million annually. Despite being the founding CEO and the face of the company, Rand did not retain this role indefinitely. When I inquired about his departure, he shared:

"In 2013 and into 2014, I faced a serious and troubling episode of depression. Many executives and team members informed me that my mental and emotional state was negatively impacting the entire company, which I fully acknowledge. I discussed with my board the possibility of stepping down as CEO and promoting our long-time COO to that position. We decided to implement that change in 2014."

Rand's experience is not isolated. Throughout my entrepreneurial journey, I have encountered numerous founders who have successfully built companies but have grappled with severe mental and emotional strain. Some, like Rand, were compelled to leave their companies as they grew due to issues such as nervous breakdowns and depression.

This raises a significant question within the entrepreneurial community: Is mental and emotional strain an unavoidable aspect of running a successful startup? Rand believes it doesn't have to be.

The Core Responsibility of a CEO

Launching a business and managing one are vastly different tasks, and the role of an entrepreneur is not synonymous with that of a CEO. These distinctions can lead to challenges for startup founders as their responsibilities shift. Many are unprepared for the types of issues a CEO must navigate.

Rand's situation exemplifies this. For him, leading a growing company with hundreds of employees and multi-million dollar budgets was incredibly taxing. He worked tirelessly, trying to remain involved in every facet of his large organization as he had when it was a small startup. However, Rand now views this as a significant error, believing it added unnecessary stress and complicated his role as CEO. Reflecting on his experiences, he asserts that this tendency often leads founders to exaggerate the difficulties they encounter. As Rand puts it:

"The only thing preventing 2014 Rand Fishkin from resolving 2014 Rand Fishkin's CEO challenges was Rand Fishkin himself. No one else was obstructing me. I was the CEO; I had the authority to make decisions. Sometimes that meant making tough choices, such as letting go of people I liked and respected but who weren’t suitable for their roles. It also meant revisiting my past decisions regarding the company's structure and owning up to my mistakes. Some of that work was challenging. But by challenging, I mean I had to send an email."

Rand recognizes that when he reflects on his failures as a CEO, he realizes that the most crucial aspects of his job were not inherently difficult. The tasks themselves required little more than communication. Instead, the real challenge of being a CEO lies in the decisions that must be made. This, he believes, is where entrepreneurs often misallocate their time. By dedicating excessive hours to their companies, they hinder their ability to make sound decisions. Rand argues this is the crux of their struggles as CEOs. He states:

"When I hear entrepreneurs brag about working 80, 90 hours a week and sacrificing sleep, I say, you are failing at your role. You are not working hard; you are working ineffectively. You are making poor decisions because you are exhausting yourself. What is a CEO's job if not to make the best decisions possible? When you step into the role of CEO, your primary responsibility is to make sound decisions. You cannot achieve that if you are toiling away for 80 hours each week."

Rand raises an important point. The foremost responsibility of a CEO is to make wise decisions. But can one truly make sound choices while immersed in non-stop work, attempting to manage the company as if it were still a small startup?

Absolutely not! This isn't just due to burnout; it's also because being constantly engaged in the day-to-day operations prevents you from gaining the necessary perspective. You become too emotionally and mentally involved in trivial matters, impairing your ability to see the larger picture, which can hinder your decision-making.

If you are a founder who takes pride in the number of hours you dedicate to your business, it may be time to reassess your priorities. It might be high time for a break. At the very least, consider leaving your computer behind for a weekend.

Initially, you may feel out of place. Guilt may set in, and you might feel as if you are neglecting your duties, convincing yourself that you aren’t working hard enough, and that you are failing your company. However, the reality is quite the opposite. By taking time for self-care, you enhance your ability to make better decisions, thereby becoming a more effective CEO.

To explore Rand's complete story, search for "Web Masters" on Apple, Google, Spotify, Stitcher, or your preferred podcast platform.