This is a small start-up (~5 employees, including 3 founders) in software development, Europe. One of the founders was self-assigned the CEO role and got biggest equity chunk, and we accepted because of his tremendous persuasive skills to get grants and support for our project. I was in charge of product development.

Over the years (~4 years) the CEO subtly and gradually stopped contributing: he stopped searching for grants, looking for investment, pitching our idea or products to potential customers, managing the employees, guiding product development, having a corporate vision and goals. He delegated all those tasks on me and the other board member. We would subsequently accept because this was a very slow and nuanced process. We didn't realize what was happening. We would de facto create a sort of parallel in-company structure where the productive board members would communicate among themselves and with the partners/suppliers/customers, take everyday internal decisions and make things work despite the incompetence of the CEO.

From the perspective of the CEO things are working and he claims all that as his merit. He deploys tactics of gaslighting to sow confusion, denial, misdirection and low self-esteem on us every time we want to know what he is exactly contributing to the company. He even uses subtle forms of intimidation and blackmail referencing supposedly huge workloads and sacrifices he's endured for the company, when in fact the rest of employees have much bigger workloads as a result of the situation.

His best tactic is endless meetings and e-mails: at the very first hint that we doubt about or question him, he makes us waste hours on meetings or book-length e-mails about a well-crafted successful CEO narrative which is actually full of lies, falsehoods and mansplaining. Though, we end up agreeing or letting it go because there's no way the conversation would stop and we don't want to waste more precious working time for which we are not particularly plentiful.

He has this ability of twisting facts and reality to his interests and presenting himself as a victim, when he's actually an abuser. Maybe you relate to this situation, it's never black-and-white and extremely hard to address. Unfortunately we have no mechanism in place to hold him accountable for his output.

I would like to stop this situation, expel the CEO and get rid of him from the board and get back his shares for the company. I'm not sure if this should be addressed internally among us (can the board remove the CEO and expel him from the board if there's a majority against him?), or if I should seek legal assistance (the presence of a lawyer or mediator), for which I'm scared he would strike back and go to court with potentially high costs. I'm also scared personally as this sort of psychological manipulation is hard to get through, but hopefully I'll find a solution for that.

  • 4
    Does a majority of the board share your views? Does the CEO's "biggest equity chunk" constitute an absolute majority of the ordinary shares? If the answer to the second question is "no", then do the directors who share your views own an absolute majority of the ordinary shares? – Daniel Hatton Feb 8 at 14:58
  • 2
    By "biggest equity chunk" I meant a bit more than 1/3 of total shares. The two remaining board members (I am one of them) have the rest, and share my view. That makes a majority (don't know if absolute). We will check the implications in the shareholders agreement. – NathanMorris Feb 8 at 17:32
  • 1
    @NathanMorris, A non-technical CEO usually gets 2%, not 33% (unless he brings capital or something really significant to the startup). Consult a lawyer. The next time you become a partner in a startup, read "The Partnership Charter" by David Gage bmcassociates.com/resources/books/the-partnership-charter-book – Stephan Branczyk Feb 9 at 3:52
  • @JoeStrazzere, You're right. My comment was a knee-jerk reaction and I over-generalized. – Stephan Branczyk Feb 9 at 13:11
  • @StephanBranczyk thanks for recommending this book. I'll definitely read it. – NathanMorris Feb 9 at 14:40

You should absolutely hire a lawyer. A good one. Who specialises in this kind of thing. And do it discreetly. This is not the kind of situation where you can afford to make a mistake or tip your hand. Even/especially if you don't end up going ahead with it.

You need to find out the answers to the following questions:

Who owns how much of the (voting) stock in the company?

Who sits on your board of directors, who is the chairman of the board, and what are your company’s by-laws for removing directors and executive officers?

What is the process for firing an executive officer?

What is the process for removing a board member? What about the Chairman of the board?

Do you have to call a meeting of the Board? What is required to do that.

Do you have to call a special meeting of the board, or an AGM? Can you even do that in advance or do you have to wait until the next one?

These basic frameworks should be laid out in your Articles of Incorporation that you submitted when registering the company, but may have been changed since. You need to find out what they are today.

If you're lucky, then the 3 of you are the directors, and directors and corporate officers (eg the Chair/CEO) can be fired by simple majority vote at any board meeting.

It may also be the case that both of you together own >50% of the votes in the company, and can remove board members / add new ones by majority vote there instead.

This would let you remove your CEO from the company and the board, although they would still continue to own their shares.

If/once you get your CEO out of the company, then you can worry about how to deal with their equity.

  • 1
    ... and even if removal is not possible, the board might be able to revoke all his decision-making powers, leaving him as CEO in name only. – Daniel Hatton Feb 8 at 15:05
  • 1
    This is your answer, you have to get a person to check your company`s paperwork,descreetly, from outside, with confidentiality agreement – Strader Feb 8 at 15:54

The CEO is appointed by the board and can be sacked by the board. Often the CEO is also Chairman of the Board. In either case the board can usually get rid of them unless they hold controlling equity.

Both positions are contracted ones and may have even easier termination clauses. But when all else fails it comes down to shareholding.

If you can get enough support from shareholders to have a controlling percentage of shares then it's worth looking into, if not, work on that first.


Not much you can do if you don't have a contract other than buying him out.

But first: consider communication therapy/counselling (together) first to make sure that he understands your feelings, and perhaps there's something going on in his personal life that explains his behaviour but he's unable to communicate it.

Maybe you can work on it if you have a plan together, understanding the underlying reasons.

Not the answer you're looking for? Browse other questions tagged .