How the start-up has obtained additional financing (i.e., by going public or by being acquired) may affect what happens to the founder and/or to the company. In the case of a firm that goes public, the founder may be exhausted from the effort that was required to start the company and sustain it through the public offering, and very often chooses to leave. In the case of a firm that is acquired, the founder may find it distressing to no longer be his or her own boss and to (once again) be part of a large organization. Furthermore, the new owners sometimes consider the founder's job as CEO of the acquired company to be redundant. Either way, his or her departure is likely.

A handful of founders have attempted to take extended vacations or retire at this point in their lives, but they often find it impossible to wind down from the excitement of the start-up process. They discover that they have become more enmeshed in the creation effort than they originally thought. Such individuals may reenter the start-up arena as venture capitalists, ready to advise others, or they may choose to "do it again," founding yet another start-up company.

Prospective investors and employees of firms that have recently gone public or been acquired should note that a company’s value often peaks at this point. Although, ideally, the enterprise has now achieved what might be termed steady-state operations and has reached the point of being able to develop new products and sustain its profitability, the departing founder(s) may have built an organization with little lasting value. The company may be locked into a product architecture that has no way of becoming self-sustaining. A successful track record up to the point of IPO or acquisition, then, is no guarantee of future success. Which brings us to the

Now that readers are familiar with the preceding simplified "program" for starting a high-tech company, it is time to consider a more detailed scenario. The "program" shown in Figure 1-2 not only expands upon the simplified program but also divides the creation of a start-up into five stages: