👉 Background: WiseTech Global is a logistics software company founded in 1994. It does all those complicated logistics activities like helping with supply chain management, customs clearance, and forwarding services. Since listing on the ASX in 2016, it has been an ASX-darling with its share price jumping more than 20x.

👉 What happened: Over the past year, WiseTech’s founder Richard White has been in the spotlight - he's been accused of bullying as well as inappropriate conduct at work. As a result, he stepped down as CEO of WiseTech in October last year and shifted into a ‘consulting’ role. But now, four of WiseTech’s independent directors have stepped down from the board because they couldn’t land on an agreement on what the founder’s ongoing role would be, or as they diplomatically put it, they had “intractable differences”.

👉 What else: Next minute, WiseTech’s share price dropped more than 24% or $10 billion in market value. And WiseTech has warned that there are delayed rollout of three new products as well. The challenge is that although the founder isn’t technically the CEO anymore - he’s on the board and still owns nearly 39% of the company - talk about founder's syndrome!

What's the key learning?

💡The founder's syndrome occurs when a company's founder maintains an outsized influence on decision-making, even as the organisation grows and evolves. And for some companies, this can become its biggest constraint to growth.

💡On the one hand, founders are often the driving force behind a company's growth, with their visionary leadership that can motivate employees and excite investors. But, when founders maintain substantial control, it can sometimes undermine corporate governance and can create conflicts of interest...particularly when the founder goes rogue.

💡Remember when Elon Musk tweeted he was considering taking Tesla private at $420 per share - the price being a reference to smoking marijuana. This led to significant stock volatility, Musk stepping down as chairman and paying a $20 million fine. While some investors are celebrating that the directors resigning means WiseTech “talent has won at the expense of corporate governance”, others are clearly concerned — by the look of the share price plummeting.