USA Today had an interesting article about how founder-led companies perform better than their non-founder-led counterparts, with a 15-year stock price appreciation of 970% vs. the S&P 500 average of 222%. Although most people will not be surprised by it, that's still a pretty powerful number, and have been studied by the investment community. From my point of view, company founders have a deep, emotional connection to the business, which make them great leaders. Other reasons explaining above numbers cited in the article include:
founders having deep industry knowledge...having a powerful presence in the company...having a huge financial stake in the success of the business...not looking for the next job so can take a long-term perspective...being street fighters early on.
I think it's more so because of the huge financial stake. When our stakes are high we tend to perform better.
ReplyDeleteA powerful number, indeed! Sounds like it is something to consider when looking for an investment.
ReplyDeleteIts like their 'baby' I guess. Interesting figures!
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