10 Founders FIRED From Their Own Businesses

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These industry leaders were forced to leave the companies they helped create. Welcome to WatchMojo, and today we’re counting down the top instances of founders of prominent companies who were fired, forced out, or pressured to resign.

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00:00 OpenAI is nothing without its people, is the message from staff.
00:04 Welcome to WatchMojo, and today we're counting down the top instances of founders of prominent
00:09 companies who were fired, forced out, or pressured to resign.
00:13 It was hard. It was unexpected.
00:17 Number 10. Dove Charney, American Apparel.
00:21 Fall of the sleaze king. Are you the sleaze king?
00:24 I'm not the sleaze king. When I really know I'm not the sleaze king.
00:28 The founder and former CEO of American Apparel faced termination from the company in December
00:32 2014, primarily due to a series of controversies and alleged misconduct.
00:37 The board of directors accused Charney of multiple instances of violating company policies,
00:42 including allegations of misconduct and inappropriate behavior in the workplace.
00:46 He was also fired for misuse of corporate assets.
00:49 Charney, known for his provocative and controversial management style, had been the subject of
00:53 numerous legal issues related to his conduct.
00:56 I mean, I don't really want to get into details of any of these lawsuits. I'll only tell you
00:59 that some of the lawsuits have involved people I've never met or non-employees themselves.
01:05 The decision to terminate Charney's employment came after an internal investigation and a
01:09 series of disciplinary actions against him.
01:12 The other big piece of news coming out is not just that Dove Charney is going, but that
01:16 American Apparel has named a permanent CEO. And that is Paula Schneider, who is a veteran
01:23 of the retail and apparel industry.
01:26 The board cited a lack of confidence in Charney's ability to lead the company professionally
01:31 and in adherence to corporate standards.
01:34 Number 9. George Zimmer, Men's Warehouse
01:37 You're going to like the way you look. I guarantee it.
01:40 In June 2013, George Zimmer, the founder and longtime face of Men's Warehouse, was unexpectedly
01:46 forced out from his position as executive chairman.
01:49 The company, known for its slogan "You're going to like the way you look. I guarantee
01:53 it," cited a difference in vision and management approach as the primary reasons for Zimmer's
01:57 departure.
01:58 Those are the facts. I guarantee it.
02:01 Zimmer disagreed with the board's decisions and expressed concerns over the direction
02:05 of the company, leading to a breakdown in their relationship. The board, in response,
02:09 took the unusual step of severing ties with Zimmer, who had played a prominent role in
02:14 shaping the company's brand.
02:15 George Zimmer is Men's Warehouse. The guy founded the company in 1973, and he's been
02:20 pretty much everything for it at several points since. In other words, he's acted as CEO,
02:26 he's been fashion director.
02:27 The circumstances surrounding Zimmer's exit were marked by public statements and a subsequent
02:32 legal dispute between Zimmer and the company.
02:35 Zimmer shot back in a statement of his own, telling ABC News he'd built the Men's Warehouse
02:39 into a multi-billion dollar company, but that now the board of directors has inappropriately
02:45 chosen to "silence my concern."
02:47 8. Aubrey McClendon – Chesapeake Energy
02:50 The co-founder and former CEO of Chesapeake Energy faced a forced departure from the company
02:55 in 2013 due to a combination of financial and ethical concerns. Under McClendon's leadership,
03:01 Chesapeake Energy engaged in controversial financial practices, including taking on substantial
03:06 debt to fund acquisitions and exploration projects.
03:14 The company faced scrutiny for its complex financial dealings, corporate governance issues,
03:19 and potential conflicts of interest involving McClendon's personal investments in Chesapeake's
03:23 wells.
03:24 Amid shareholder concerns and a declining stock price, the board of directors conducted
03:28 an internal investigation that revealed undisclosed loans taken by McClendon using company assets.
03:33 He always had an aggressive strategy. So that was leasing everywhere, that was building
03:40 a hedge fund where he invested his own money, that was borrowing his own money and betting
03:44 even more on his shares. So he's an aggressive guy, but this is a little bit surprising.
03:49 Facing mounting pressure and legal challenges, McClendon resigned from Chesapeake. Tragically,
03:53 he died in a car accident one day after charges related to the loans were announced.
03:58 The autopsy shows no sign of alcohol, but the medical examiner detected trace amounts
04:03 of doxalimon in McClendon's system. It's used as an antihistamine and it's also an
04:08 ingredient in Unisom, a sleep aid.
04:11 Number seven, Mike Lazaridis and Jim Balsillie. BlackBerry. These co-founders and longtime
04:17 leaders of BlackBerry, formerly Research in Motion or RIM, faced a challenging period
04:21 that led to their eventual departure.
04:23 It invented and manufactures a pager called a BlackBerry. Its unique feature, a keyboard
04:29 that allows you to send and receive email essentially in real time.
04:33 As BlackBerry struggled to compete with the rising dominance of smartphones, particularly
04:36 the iPhone and Android devices, the company's market share declined significantly. Lazaridis
04:41 and Balsillie faced criticism for their slow response to changing market trends and their
04:45 failure to innovate and adapt.
04:47 "We're dealing with a lot of issues and I think that we're doing our best to deal
04:54 with the kind of expectations that we're under."
04:56 In 2011, amid declining sales and market share, Lazaridis and Balsillie stepped down from
05:01 their co-CEO roles and handed the leadership reins to Torsten Heinz.
05:05 "The company stressed it's an orderly transition in a long-agreed succession plan,
05:10 not a retreat in the face of a plummeting share price, shrinking market share and criticism
05:14 of its products."
05:15 The move was seen as an effort to bring in fresh leadership and revive the company's
05:19 fortunes. BlackBerry continued to face difficulties, including the failure of its BlackBerry 10
05:25 platform.
05:26 Number six, Sandy Lerner, Cisco.
05:28 "It was August 28th, 1990, but who's counting?"
05:31 "Okay, and what happened that day?"
05:35 "Well, quite simply, I got fired."
05:37 Sandy Lerner, along with Leonard Bozak, co-founded Cisco Systems in 1984 and played a crucial
05:43 role in its early success.
05:45 "The company they started in 1983, Cisco Systems, today does $10 billion a year in
05:51 business."
05:52 However, in 1990, Lerner was forced out of Cisco, a company that went on to become a
05:56 global technology giant.
05:58 The circumstances surrounding her departure were complex and involved disagreements with
06:03 the board of directors over the company's future direction.
06:06 "Sandy and Len soon discovered what many entrepreneurs before them have learned, that the company
06:11 you founded is no longer the place you work."
06:14 One significant issue was the strategic vision for Cisco. Lerner was reportedly more focused
06:19 on the development of innovative technology, including routers and switches, while the
06:23 board was leaning towards a more business-centric approach.
06:26 Additionally, there were clashes over management styles and corporate culture.
06:31 Number 5. Sean Radd, Tinder
06:34 In 2014, Sean Radd temporarily stepped down from his role as CEO of Tinder amid a series
06:40 of controversies and legal challenges.
06:42 "Tinder became, it became a viral phenomenon. And if you ask any analyst, the most exciting
06:47 thing about IAC is Match. And the most exciting thing about Match is Tinder. So I think the
06:51 executives looked at this and said, 'Listen, we need real management.'"
06:55 The decision was prompted by a lawsuit filed against Tinder which alleged misconduct.
07:00 To address the negative publicity and legal issues, the board of directors decided to
07:04 suspend Sean Radd as CEO.
07:06 "To me and most of the organization, because we were doing so well. And I think the idea
07:13 was that we should bring in someone with a bit more experience, which I, you know, I
07:20 think experience is needed at all levels of the organization."
07:23 Chris Payne, a technology executive, was appointed as the interim CEO during Radd's suspension.
07:29 The move was part of the company's effort to navigate the legal challenges and restore
07:33 confidence in its leadership.
07:35 "Being at the helm of a fast-growing company, and I felt a lot of pressure every day. And
07:40 I didn't have all the answers and I wasn't perfect. But when I was fired, I no longer
07:46 felt that pressure. I was able to let go."
07:48 Later in 2014, Sean Radd returned to the CEO role after the legal matters were addressed
07:53 and settled.
07:54 Despite the temporary disruption, Tinder continued to grow in popularity and became a leading
07:59 player in the online dating industry.
08:02 Number 4. Bini Bansal, Flipkart
08:04 "We actually reinvented the wheel of e-commerce here."
08:09 Sachin Bansal and Bini Bansal, who were unrelated, were two co-founders of Flipkart.
08:13 Walmart's acquisition of a majority stake in the Indian e-commerce giant changed their
08:17 fortunes.
08:18 "In a blockbuster deal in 2018, Flipkart sold a majority stake to U.S. retail giant Walmart
08:26 for a whopping $16 billion U.S. dollars."
08:29 While the Bansal duo had been instrumental in Flipkart's success, their departure was
08:33 influenced by strategic differences with Walmart.
08:36 Sachin Bansal's exit preceded the acquisition in May 2018, and he sold his entire stake
08:41 in the company.
08:42 Bini Bansal initially stayed on as group CEO after the acquisition, but later resigned
08:46 in November 2018.
08:48 This was a different sort of departure, because although initially framed as a mutual decision,
08:53 it was clouded by allegations of personal misconduct.
08:56 "And this e-commerce giant is now without either of its co-founders."
09:02 Number 3. Travis Kalanick, Uber
09:05 The high-profile co-founder and former CEO of Uber was pressured to resign in June 2017
09:10 amid a series of controversies and scandals that plagued the ride-sharing company.
09:14 The surprise announcement comes one week after Kalanick said he would be taking a temporary
09:19 leave of absence following the death of his mother, and in the wake of company-wide changes
09:24 following Eric Holder's investigation into Uber's corporate culture.
09:29 Allegations of a toxic workplace culture and questionable business practices created a
09:32 storm of negative publicity.
09:34 A key turning point was a blog post by former Uber engineer Susan Fowler, detailing her
09:39 experiences of harassment and the company's response.
09:42 "I expected it would be like a 24-hour, you know, like viral thing, but it didn't slow
09:48 down at all.
09:49 And I was reading through all these things and I thought like, 'Oh my gosh, like I'm
09:52 not alone.'"
09:53 Additionally, there were reports of a video showing Kalanick berating an Uber driver.
09:58 Facing intense scrutiny and mounting investor pressure, Kalanick resigned to allow the company
10:03 to move forward with a change in leadership.
10:05 "But the one thing you just cannot overcome is when you've lost the team.
10:08 And I think it was clear that Travis had lost the team and recruiting here is hard.
10:13 And if you have a culture that basically doesn't attract half of the population of talent,
10:20 it's very, very hard to overcome."
10:21 Number 2.
10:22 Sam Altman - OpenAI
10:25 Sam Altman, to the shock and surprise of everyone in the tech world, was ousted in November
10:30 2023 as CEO of OpenAI.
10:33 Altman was in many ways the public face of AI technology, and the reasons for his ousting
10:37 are still unclear.
10:39 "The reasons behind his departure, not entirely clear, but the board said he had been quote
10:43 'insufficiently candid.'
10:44 His departure has triggered a stream of resignations at the firm.
10:48 In his place, they have appointed Emmet Shear, the former CEO of Twitch."
10:53 The unconventional structure of the organization meant that the firm's profit and non-profit
10:57 objectives were increasingly at odds, especially given the rapid pace of development of generative
11:02 AI and how it was clashing with the board's emphasis on effective altruism.
11:06 "He is very much at the forefront of this company.
11:10 I was in Congress, Scott, back in May.
11:13 He was the one who testified in front of Congress talking about AI regulation.
11:18 He's the guy to go to.
11:19 He has been at the forefront of this AI boom we've been seeing more than any other company,
11:24 more than any other person, and he is now out."
11:26 As none of the firm's investors were represented on the board, the news caught all off guard.
11:32 "The move came as a complete surprise to everyone, including OpenAI's biggest investor, Microsoft,
11:38 and it's all raising big questions about the future and safety of artificial intelligence."
11:43 Within days, Altman landed on his feet at Microsoft, which has committed $10 billion
11:48 in cash and cloud computing credits to OpenAI and owns a 49 percent stake in its for-profit
11:54 arm.
11:55 However, OpenAI's employees have threatened to quit en masse unless Altman returns.
11:59 As of writing, the situation remains fluid.
12:02 Before we get to our top pick, here are some honorable mentions.
12:06 David Nealman, JetBlue Airways.
12:08 The co-founder stepped down after widespread service disruptions in 2007.
12:12 "It was certainly a very painful experience because I felt like it wasn't handled well.
12:21 I always told our people at JetBlue, it's not really what happens to you in life, it's
12:24 how you react to it."
12:26 Jack Dorsey, Twitter.
12:27 The social media titan co-founder resigned in 2021, but it's unclear if he was pushed
12:32 out.
12:33 "This is the end of his second tenure as CEO.
12:36 He served as CEO between '06 and '08, and then he began his second stint leading the
12:42 company in 2015."
12:44 Jerry Yang, Yahoo!
12:46 Resigned in 2012 after criticism, including mishandling of Microsoft's acquisition bid.
12:51 "Yahoo!
12:52 Resigned in 2013."
12:53 Jerry Yang has left the now-struggling, iconic website he helped start in 1995.
12:58 He had already resigned as CEO in 2008 after angering shareholders by turning down Microsoft's
13:03 offer to buy the company for $47.5 billion.
13:08 Andrew Mason, Groupon.
13:10 Resigned in 2013 amid growing dissatisfaction from investors.
13:13 "Mason is paying the price for the loss of almost $724 million over the past three years
13:20 and the company's failure to expand its business beyond online coupons."
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13:41 Number 1.
13:42 Steve Jobs, Apple.
13:44 He may have been a visionary, but Steve Jobs was ousted from Apple, the company he co-founded
13:49 in 1985.
13:51 Jobs was known for his intense management style and ambitious projects, and he clashed
13:55 with then-CEO John Sculley over strategic direction and product development.
13:59 "You're issuing contradictory instructions, you're insubordinate, you make people miserable,
14:04 our top engineers are fleeing to Sun, Dell, HP, Wall Street doesn't know who's driving
14:08 the bus, we've lost hundreds of millions in value and I'm the CEO of Apple, Steve, that's
14:13 my resume."
14:14 The breaking point came when the board of directors sided with Sculley, leading to Jobs'
14:18 removal from his managerial role.
14:20 "And they said, Steve, we want you to step down from running the Macintosh division,
14:24 not get fired, you know, you're still chairman, you're still the largest shareholder, but
14:31 not get fired."
14:32 Jobs' departure was a pivotal moment in Apple's history, as the company eventually struggled
14:37 without his leadership.
14:38 However, he later returned to Apple in 1997, when the company acquired a computer company
14:44 he founded during his hiatus.
14:45 "I think Apple has delivered some pretty good stuff.
14:49 I think Apple's going to get back to delivering some great stuff."
14:52 Jobs' triumphant return marked a remarkable turnaround for Apple, eventually leading to
14:56 the creation of iconic products like the iPod, iPhone and iPad.
15:01 "What we're going to do is get rid of all these buttons and just make a giant screen.
15:07 A giant screen."
15:09 Is there a founder we missed?
15:11 Let us know in the comments.
15:12 "His second act a decade later is considered one of the greatest CEO tenures of all time."
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