My co-founder and I have equal equity, but as we prep for an exit, it is obvious he does not GWC his Operations seat. He is dropping critical deliverables, yet he insists on keeping the seat because of his ownership status. How do we resolve this on the Accountability Chart?

Question

Tyler Smith · Accepted Answer

You must separate ownership from operations. This is one of the hardest but most crucial distinctions for co-founders to grasp. On your Accountability Chart, there is no seat labeled Owner. There are only operational seats like Visionary, Integrator, Sales, and Operations. Your co-founder's fifty percent equity belongs on the cap table, which sits completely outside the operational chart. In his operational seat, he is an employee who must be held to the exact same standards as anyone else. Use the GWC tool objectively. If he does not have the capacity or desire to run operations at the scale required for an exit, he is in the wrong seat. Keeping him there hurts the valuation of your company and creates a toxic culture of double standards. Sit down with him and frame the discussion around maximizing the value of your shared asset. He can transition to a board-level advisory role or focus strictly on his areas of strength in a different seat while you hire a professional to run operations. He will still benefit from the financial upside of a clean exit, but he must step out of the seat he does not GWC.