From Buyer to Boss: What Every New CEO Needs to Know

Entrepreneurship Through Acquisition is gaining traction among business school grads who are eager to lead a company — without having to build one from the ground up. But buying a business is just the first step. The challenge begins after the deal closes, when the new owner must shift from buyer to CEO. The question is: how do you navigate that transition successfully?

Below are insights from Les Alexander, the John Glynn Endowed Professor and a professor of practice at the University of Virginia’s Darden School of Business, along with some lessons from Darden alumni who’ve been in the trenches: Kevin Isaacs (MBA ‘17), president at Tribunus Health; Andrew Kalna (MBA ‘21), CEO at Access Care LLC and managing partner at Third Port Capital LLC; and Darrell “DJ” Pacheco (MBA ‘23), president and owner at Shenandoah Joe Coffee Roasters.

The Power of the 100-Day Plan

Every new business owner needs a roadmap, and the 100-day plan provides a solid framework for getting started.

“It’s essential to have a plan with important items that you need to either verify or improve,” says Kalna. “It’s easy to get distracted running day-to-day operations, and having a plan helps you stay true to your priorities. Some of those priorities will change as you meet the team, learn, and understand how things really work. Your plan is going to evolve, but having one — and refining it along the way — is where you get a lot of value.”

One of Kalna’s priorities was to ensure that everything was in place to properly treat and bill Access Care’s clients. “You have to have money coming in to be able to pay your staff,” he says. “To me, that was a foundational trust item.”

On the IT front, Kalna commissioned an independent audit that identified opportunities to enhance his company’s systems and security. “As a small business in healthcare, we’re mindful of cyber threats,” he says. “We are HIPAA compliant, so we want to use best practices and have the right software and hardware.”

Learning Before Making Changes

The most counterintuitive advice for new CEOs is to avoid making immediate changes. As Alexander puts it, “You're getting your feet under yourself, trying to make sure that you understand how to manage the business and set the priorities for the future. Making changes just to make changes is not a good strategy.”

Instead, new operators should focus on listening and learning.

Pacheco, did precisely that. “My priority was to understand the business and the industry,” he says. “Coffee is a globally connected field with countless ways to prepare and enjoy it. The sellers had a great system in place, and the business was running smoothly. My goal was to take a deeper look at the business than I did during due diligence and consider what changes — if any  — could make it more efficient.”

Sometimes, however, change is necessary, says Isaacs, whose firm helps healthcare providers obtain in-network status and better reimbursement rates. “In some circumstances, making changes can lead to greater stability for your business. If you can improve your employees’ lives by adopting new approaches quickly, then it’s important to do so.”

Establishing Credibility with Employees

Credibility isn't automatic with ownership — it must be earned. Employees want to follow someone who understands their industry and business as well as the practical realities they face every day.

“You can pick up small wins early in your tenure if you listen to people,” says Alexander.  He notes that even something as simple as fixing a broken coffee maker can boost your credibility. Such a minor improvement signals that you care about the people and their work environment.

For Isaacs, fostering a positive work environment is vital to attracting and retaining top talent, which in turn enables his company to provide excellent service to clients.

Isaacs is willing to go so far as to part ways with clients who disrespect his staff. “If a client is being unprofessional towards an employee who works hard and is doing a great job, we’re not afraid to show them the door,” he says. “This sends a powerful message about who we care about and where our priorities lie. For me, fostering a strong organizational culture, which leads to organizational stability, is crucial.”

Unsurprisingly, Tribunus Health has a low employee turnover rate and a high boomerang rate — the percentage of employees who leave the company and later return.

Leveraging the Seller's Knowledge

The relationship with the previous owner can be a valuable resource, according to Alexander. Customer relationships, supplier connections, and industry insights don't automatically transfer with ownership. The seller often serves as the bridge, introducing the new owner to key stakeholders and sharing the informal knowledge that makes the business work.

Before acquiring Shenandoah Joe, Pacheco spent a year learning the ins and outs of running a small business. He also took the time to build a relationship with Shenandoah Joe’s owner. As a result, he gained a deep understanding of the company’s positive impact on the community through its charitable contributions — insights that no amount of financial due diligence could have uncovered.

“Yes, I reviewed the numbers,” Pacheco says, "but meeting the organizations, the people, and seeing the impact with my own eyes made me realize that this business has tremendous goodwill in the community and being the steward of that has been a rewarding experience."

Managing Human Capital

Finding and retaining good employees is one of the key challenges of small business ownership. “You inherit a team, but you must evaluate whether you have the right people and if those people are in the right seats,” says Alexander. This assessment requires both patience and decisiveness.

The saying “hire slowly, fire quickly” exists for a reason. Holding on to team members who aren’t contributing effectively hurts the business. On the flip side, rushing the hiring process often leads to poor fits that cost business owners even more time and energy down the road.

To avoid hiring mistakes, Isaacs starts with carefully defining the role he intends to fill. “A lot of my thinking on hiring is informed by a book, Who, by Geoff Smart and Randy Street," he says. “When you define the role well, it becomes easier to define what characteristics and competencies are going to make someone successful in that role.”  

The first interview is always about mission fit, notes Isaacs. “It’s about making sure that someone's ‘why’ matches not only the essence of their role, but also the purpose and mission of our company.”

Balancing Business and Personal Well-being

The demands of running a newly acquired business can be overwhelming. Many business owners feel compelled to pour every ounce of energy into their work, but long-term success requires balance, notes Alexander. This includes maintaining physical health through exercise and proper nutrition, preserving essential relationships, and managing stress effectively.

Pacheco learned that lesson the hard way. “The first 100 days were intense,” he says. “Things pile up, and the stress is extraordinary. I wasn’t sleeping well.” Pacheco eventually found relief by prioritizing exercise and setting personal fitness milestones.

What helps Kalna manage the pressure of running a business is carving out time for relationships outside of work. “Keeping the same routine is also important,” he says. “That’s how I control stress and do my best thinking.”

Stepping Into the CEO Role

Unlike larger companies with specialized teams, small businesses require leaders who wear many hats. “Small business owners often spend so much time putting out fires that it gets hard to step back and focus on strategic thinking that fuels growth,” says Alexander.

According to Isaacs, the more you surround yourself with experts in their areas, the more time you have to identify and solve the key constraints to growth, if growth is your objective.

“Lots of roles I hire for now are ones I wish I could do full-time,” says Isaacs. “But you have to let go of some functions to give yourself more bandwidth to focus on building a better business.”

Making time for strategic thinking is part of Pacheco’s routine, though not always easy amid the constant demands of running a business. When issues arise — especially those involving customers — Pacheco and his team address them quickly to minimize disruption. Afterward, Pacheco encourages his employees to reflect on why it happened, identify process improvements, and document the changes.

For Kalna, stepping into the CEO role for the first time was a lesson in letting go of the need to solve every problem himself. “It’s about trusting your team,” he says. “It’s also about supporting and developing your employees to build greater capacity and capability across the organization.”

In addition to providing opportunities for professional growth, Kalna prioritizes flexibility and empathy — whether that means allowing an employee to come in late or stay home with a sick child. “My philosophy is simple,” he says. “When you take care of your employees, they’ll take care of your clients. And small gestures like that can make a big difference.”

Kevin Isaacs, Andrew Kalna and Darrell "DJ" Pacheco recently participated in a panel discussion titled "You Bought a Business. Now What?" at the annual Southeast Entrepreneurship Through Acquisition Conference at Darden.