Part 7 of the Cultural Alchemy series
There is a moment in every founder's succession when the new CEO realizes they are not just stepping into a role. They are stepping into an ecosystem that is actively reshaping itself.
I watched this land for a CEO I was coaching. She had been brought in to professionalize a fast-growing startup that had outgrown its scrappy origins. The board wanted process, structure, and predictability. On paper, she was a perfect fit. MBA. Strong track record. Proven playbook. But three months in, she called me from her car after a particularly tough all-hands meeting.
"I feel like I'm killing the thing I was hired to save," she said. "Every system I introduce seems to drain the life out of the culture. But if I change nothing, we will never scale."
She was not failing. She was coming to understand what it means to lead inside a living, shifting culture. One where the old patterns no longer hold and the new ones are still taking shape. A space not of crisis, but of continual emergence.
The Space Between Stories
If you've been following this Cultural Alchemy series, you'll recognize the patterns we've explored: invisible scripts that shape behavior, frameworks that fail under pressure, cultural pace layers that change at different speeds, and how ideas move through organizational networks. At the heart of all of it is one leadership capability — holding space for transformation without forcing premature closure.
This is liminal leadership. And founder successions offer a front row seat in how it really works.
Anthropologists use the word "liminal" to describe threshold experiences — the unsettling phase between the end of one identity and the start of another. Think of a butterfly inside its chrysalis. No longer a caterpillar. Not yet a butterfly. Something else entirely, reshaping itself.
Organizations move through these thresholds too. During mergers that reshape entire industries. In tech shifts that wipe out business models overnight. Amid market crashes that demand a total rethink. But few moments make liminality as visible or as volatile as founder transitions.
When a founder steps down, people do not just get a new leader. They enter a cultural chrysalis. The assumptions that shaped daily life no longer hold. Stories that once gave work meaning need rewriting. Those invisible scripts we looked at in Part 1? All are up for review.
As one employee shared during a transition: "It still looks like our company. The people are the same. And yet, something feels different. It's not what we were — it's something new, something unfamiliar. And that feels like a loss."
That is what psychologists call ambiguous loss — the grief of losing something still physically present. The office is unchanged. The names on Slack are the same. But something fundamental has shifted. People grieve the culture they once knew while trying to find their footing in whatever is emerging.
Most leaders rush through this discomfort. They try to reestablish order, set new norms quickly, and push for alignment. But liminal leadership asks for something else entirely.
The Pendulum Trap
Here is a pattern I see again and again in founder transitions: The founder creates. The successor overcorrects. The stabilizer synthesizes.
This is not random. It shows us how cultural transitions can fall prey to overcorrection rather than integration.
Companies rarely plan these shifts with a long view. More often, boards and founders react to pain points by hiring leaders with traits that counterbalance the last era. If the founder was intuitive and informal, the next leader is often chosen for structure and discipline. If the culture prized collaboration but moved too slowly, the successor is a decisive executor.
What starts as an effort to "fill the gaps" can become a swing too far in the opposite direction. These pendulum swings create unnecessary trauma when leaders don't recognize the underlying dynamics.
I have watched this dynamic repeat across industries. The informal founder gives way to the structure-focused manager. The collaborative leader is followed by the hard-driving executor. The visionary is replaced by the operator.
These pendulum swings often address real needs. Startups need structure as they grow. Teams need clarity in competitive environments. But when leaders do not recognize the underlying dynamics, the swings create unnecessary trauma.
The CEO I mentioned was caught in this trap. The board had brought her in with a clear mandate: scale the company, introduce structure, and make it ready for the next stage. She genuinely believed that building a more professional culture, through clearer processes, defined roles, and consistent execution, was what the organization needed to grow. And in many ways, she was right.
But what she had not anticipated was how deeply people still identified with the founder's way of operating. To them, each new process felt like a rejection of the company's essence. Every structure she introduced triggered what felt like an organizational immune response.
The turning point came when she stopped trying to replace the founder's culture and started helping it evolve. The narrative shifted from "We need to be more professional" to "We need to grow our capacity for both innovation and execution." She began asking, "What made this work when we were smaller? And how do we protect that as we scale?"
This is the essence of liminal leadership. Not either-or. Both-and.
When Your Authority Comes From The System You Are Changing
What makes cultural transitions so tricky is this: your authority comes from the very system you are trying to change.
Traditional leadership assumes a stable foundation. You give direction, and people understand what you mean because you all share the same cultural reference points. But in liminal space, the reference points are dissolving.
When a new leader says "focus on execution," the team might hear "stop innovating." When she asks for "more structured communication," people interpret that as "less authentic connection" or "now I have to generate a bunch of reports I hope you read — or gussy up PowerPoints just to walk you through things."
This is why so many change efforts fail. Leaders are trying to assert clarity inside a story that is still unraveling.
Liminal leadership draws on a different kind of authority. You are not expected to eliminate uncertainty. You are expected to walk with people through it. You ask better questions instead of offering fast answers. You create space for productive tension instead of rushing to resolve it.
The Art of Cultural Translation
One of the most critical skills in liminal leadership is cultural translation. That means helping people understand how their identity, strengths, and way of working fit into a changing system.
In that same founder transition, we uncovered that the engineering team's frustration was not about the new processes. It was about whether their contributions still mattered. Under the founder, technical elegance was celebrated, even when it took longer. Would that still be true?
The liminal leader does not dismiss this as resistance. They hear it as a question of belonging.
We worked with the CEO to run "translation sessions." Small group conversations where people explored how what they did best served the future, not just the past. These were not sessions about fixing behavior. They were about connecting purpose to a new chapter.
This is what cultural translation looks like. Helping people carry forward their core identity while adapting their story.
Working With The Rhythm of Change
As we explored in Part 3, culture changes at multiple speeds. Behaviors shift quickly. Core beliefs evolve slowly. Trying to change all layers at once creates chaos.
The most effective leaders I have seen follow what I call the breathing pattern:
Inhale. Make room for what wants to emerge.
Hold. Let the stillness speak. Listen for the truths beneath the noise.
Exhale. Move with care, shaped by what the pause revealed.
Repeat. Breathe with the system. Culture shifts like weather. Subtle, steady, alive.
The CEO I coached embraced this rhythm. Rather than push her whole plan in the first quarter, she ran small experiments on the surface layers — behavior and process — while keeping space open for conversations about values and assumptions.
When engineers pushed back on a new code review system, she did not argue. She asked, "What are you afraid we'll lose?" That question revealed a concern for craft that had not been acknowledged. They revised the plan to preserve what mattered without sacrificing the need for consistency.
The Ongoing Journey
As I close this Cultural Alchemy series, I am struck by how much of this work is about learning to move with complexity, not against it.
Whether we are exploring pace layers, invisible scripts, or contagious emotions, the same truth keeps showing up. Leading cultural change is not about driving toward control. It is about creating space for emergence.
Every organization is navigating liminal space. The leaders who thrive are the ones who see the in-between not as a problem, but as the place where transformation happens.
Because culture is not a code to crack. It is a living system. And liminal leaders? They know how to tend the system without trying to force it.
If this resonates with your experience of leading through change, share it with someone in their own liminal space. Sometimes the most powerful thing we can do is remind each other: being in transition is not failure. It is where the magic happens.