Overview of Practical Founders Podcast — Episode #179: "Don't Sell Your SaaS Yet: Hire a CEO and Get Your Life Back" (guest: Tighe Burke)
This episode (host Greg Head) explores a third path for founders who don’t want to keep running their SaaS business forever or sell it now: hire a high‑quality operator / CEO to take the business to the next stage while the founder steps back (or focuses on product, family, new ventures). Guest Tighe (Ty) Burke of Search Partners explains when this makes sense, how to run the search and hire, compensation approaches, onboarding and governance, common pitfalls, and how AI is changing the operator role.
Key takeaways
- Founders usually face three doors: keep running the company, sell/exit, or hire an operator/CEO and retain ownership while reclaiming life.
- Hiring an operator can increase company value (higher multiples later) and let founders focus on higher‑value work.
- Typical target businesses for this play: generally $5M+ ARR (but possible at lower sizes if profitable/mature); Search Partners focuses on roughly $5–50M revenue.
- A curated, headhunt approach (not job posts) and a robust interview/chemistry assessment are essential.
- Compensation commonly uses a mix of salary, performance bonus/profit‑share, and equity (or phantom equity / transaction bonuses). Equity seen up to ~18% in performance‑based deals.
- Transition is staged: 2–3 month “shadow” onboarding; founder steps back; eventual chairman/board role after 6–12 months.
- Red flags: founder won’t relinquish control; team continues to go to founder instead of new CEO; hired CEO defers too often to founder.
Who is Tighe (Ty) Burke and Search Partners
- Ty Burke is founder/principal of Search Partners (srchpartners.com). He previously worked at a large search firm and launched Search Partners ~6 years ago.
- Focus: executive searches for bootstrapped / founder‑led tech and software companies (typical revenue band $5–50M).
- Model: boutique, curated headhunting — aggressive research + targeted outreach. Average search ~74 business days (~3 months).
- Track record: dozens of placements per year; built an approach that focuses on founder readiness and founder/operator chemistry.
When to consider hiring a CEO / operator
- Founder readiness: the founder can clearly articulate what hiring an operator unlocks personally (family time, new ventures, less day‑to‑day).
- Business economics: the company must be able to sustain competitive total comp for an experienced operator (salary + incentives).
- Typical sweet spot: ≈$5M+ revenue; at $3–5M you may attract strong VPs/GM, at $10M+ you can be highly competitive for top operators.
- Common founder scenarios:
- Founder is a “starter” not a “scaler.”
- Founder is burnt out or wants a different life balance (e.g., family).
- Founder wants to preserve culture/mission and avoid selling to PE.
- Founder wants to focus on product/AI/vision and offload operations.
The search and hiring process (how Search Partners does it)
- Kickoff + strategy: define role, success metrics, experience profile (e.g., international expansion, P&L ownership).
- Curated research & aggressive headhunting — typically dozens of candidates sourced; Search Partners does not post jobs.
- Interview funnel: often ~30 initial conversations → short list → founder interviews (founder typically invests ~5–7 hours in the courting process).
- In‑person meetings are common (~75% of the time) — dinner/coffee to test chemistry.
- Guarantees: Search Partners provides a 1‑year placement guarantee (replacement search free if hire doesn’t last).
Candidate profile & chemistry signals
- Operator profile: proven GM/CEO/President experience scaling companies through the $5–50M zone; scrappy startup experience preferred, or a mix of big corporate rotational programs + startup wins.
- Red/green flags:
- Green: long tenures (builders) at prior companies, speaks in “we” (team orientation), evidence of having led through downturns.
- Red: serial short stints (tourists), constant “I” language, lack of scrappiness or no proof outside of big‑brand resources.
- Cultural fit: alignment on vision, willingness to accept autonomy, ability to be different in style from the founder while executing toward shared goals.
Compensation & incentives
- Typical constructs:
- Competitive base salary + performance bonus.
- Profit‑share structures: e.g., percentage of profits above a baseline EBITDA (useful for bootstrapped, profitable businesses).
- Equity / phantom equity / transaction bonus: milestone‑based equity vesting is common; largest equity offers seen ~18% (usually performance‑contingent).
- Transaction bonus: percentage of sale value if an exit occurs.
- Guiding principle: align pay to baseline business performance and reward growth beyond that baseline (don’t pay for what already exists).
Onboarding, governance and founder role post‑hire
- Onboarding phase: 2–3 months of heavy engagement by founder (introductions to customers, vendors, internal handover) but with intentional step‑back on decision authority.
- Transition timeline: founder progressively reduces day‑to‑day involvement; a chairman/advisory role often emerges after ~6–12 months once systems and trust are established.
- Board/governance: clarify level of autonomy upfront — operators who can “sink or swim” usually deliver better results. Founders must be prepared to let go.
Common pitfalls & how to avoid them
- Founder not willing to relinquish control — creates a “puppet” dynamic and frustrates top operators.
- Hiring the wrong operator profile (big corporate leader with no startup scrappiness or too junior for the task).
- Misaligned incentives or unrealistic comp expectations (let market signals inform what the role will cost).
- Poor chemistry — hire someone whose leadership style and values clash with the team/founder.
- Solution: define desired outcome, benchmark compensation via market data, insist on real autonomy, make time for in‑person chemistry checks, plan a staged handover.
How AI is changing the hire
- AI makes the builder vs operator distinction clearer:
- Tools can automate many “grunt” tasks; founders with strong product/vision skills become even more valuable.
- Operators are expected to be AI‑augmented: use tools to scale operations, but leadership, strategy, org design and people skills remain critical differentiators.
- Operational excellence + strategic leadership are still table stakes; AI amplifies effectiveness but doesn’t replace judgment.
Actionable checklist for founders thinking about hiring a CEO
- Introspect: What’s the perfect end state? (Do you want to cash out, stay as chair, return to product, start something new?)
- Confirm economics: Can your EBITDA/revenue support a competitive CEO total comp?
- Define the role: clear KPI/milestones, P&L ownership, decision authority, timeline for transition.
- Decide compensation mix: baseline + performance bonus, profit‑share triggers, equity milestones, transaction bonuses.
- Engage a specialist recruiter or search partner (curated headhunt approach recommended).
- Vet candidates for both track record and cultural fit (look for long tenures, “we” language, scrappy wins).
- Plan onboarding: 2–3 month shadow, clear handover, regular checkpoints, and an eventual shift to chair/advisory role.
- Set red‑flag indicators (team bypassing CEO, CEO deferring key decisions back to founder) and remediation steps.
Notable quotes from the episode
- “Don’t sell your company — hire somebody to run it better than you.”
- “There is 100% somebody who is better at running your business than you. It’s a matter of finding that person and being comfortable letting go.”
Contact / next steps
- Search Partners website: srchpartners.com
- Ty (Tighe) Burke — spelling: T‑I‑G‑H‑E Burke; email referenced: ty@srchpartners.com
- LinkedIn: search Ty Burke / Search Partners
If you’re a founder feeling less fulfillment in day‑to‑day ops but not ready to sell, this episode provides a realistic framework and a recruiter’s playbook for safely replacing yourself with a true operator while preserving upside and reclaiming your time.