This is very familiar and I've been dealing with it for a lot longer.

Unfortunately my conclusion has been that I cannot grow my company any further with my co-founder, and I instigated a search for a buyer a few months back.

I'm not sure how much of my advice is going to be useful if your money has nearly run out, but I can share what I went through to try to resolve the situation, and how it came to this.

Can you agree on what the company is trying to do? Can you write it down? This is so important and took me & my co-founder years! Pick a performance metric for the company, share it with everyone and hold yourselves accountable. (we didn't do this for >10 years, until the growth had slowed - we had to backtrack through our random walk to find a model of why we'd grown, and therefore how we might grow more deliberately in future!)

If you can do that, great! Now can you agree on what your individual roles are in achieving those goals? Can you give them titles? You say you've turned over $1m but I assume you have funding as well - what to do next really depends on how many staff you have, and whether you need them all to achieve your goals.

If you have <10 or so, the "overstepping your bounds" dynamic sounds like a big worry - that might be your co-founder trying to build a comfortable wall where there probably shouldn't be one. At that size it's more important that you can trust each other to step in where necessary. If you have e.g. >20 staff, it's more important you cultivate autonomy among your two management chains, and try to hold each other accountable to higher level goals, accepting a bit of inefficiency in the process.

I'd not write off someone who wants to take on sales & figurehead (CEO) stuff. Business need contributions that are not just "technical work", and you might be guilty of undervaluing what your partner does. The company dies without sales, and a figurehead needs to take primary reponsibility for the company's mission and keeping it accountable for that. They should also be the first person to spot customer problems, and want to air them out. At your size there should be a really tight loop between "sales person" and "product problems person", and the CEO needs to be in charge of that.

So don't be tempted to talk down your partner's role as you've done here. Talk it up, then hold them to it. Ask why your CEO-in-waiting is letting customer problems are going unaddressed, and why he's not taking charge of sales while you solve real operational issues. Give him the shape of the business as you see it - that you're going to lose buyers because it's clear that the company is not solving current customers' problems well enough. Ask what his plan is to resolve that, and ask that he take charge of that plan- he's the figurehead, the salesperson-in-chief.

(from what you're saying, it sounds like your CEO might need to get down with the product like he did at the start, and make a plan to step back up when more sales effort is required - is that about right? This kind of temporary change of role falls out of the targets you agree.)

Management failings are really really hard to address. Unfortunately telling your partner that they are a bad manager, despite all the evidence you can muster, will not work. If you're expected to fill in for their managing - bring that to their attention. Tell them what conversations you've had with "his" staff, why that's a problem, and what you'd like him to do to resolve them.

(This was probably the biggest red flag in my business - an elaborate shadow management structure to prop up a bad manager is torture for everyone. If your co-founder is motivated by fealty, flattery etc. rather than having his staff achieve cool things - that is such a hard attitude to shift, and especially to recognise in yourself. Being as absolutelly charitable as possible - what do you think they are motivated by? Has that changed since day 1? Can you work with that motivation?)

So ... I'm not sure if you've had a direct conversation, or what personal stock you might have in being blunt to the point of risking your relationship. But the financial situation sounds like you may not have a choice (is this subscription revenue or a predictable set of one offs? I'm guessing subscription and investment has taken your burn rate too high?).

Lay it on the line to your partner, with the greatest respect to his past achievments. You had nothing, you now have a company & professional respect. Leave bitterness and ego at the door. Put the crucial problems of the business on the table, and see if you can build fresh confidence between you to resolve it.

If you can't do that in one or two meetings, where the stakes are very clear to your partner, make your own plan to leave because at that point it won't be mutual. Don't give yourself the pain of trying to agree a mutual exit plan - decide what's right for you, and execute on that.

The line about "struggling to have meaningful conversations" is exactly where I was years ago - and still am in some ways. It took me a while to get from that point to actually pushing to leave, but I've had to do that on his schedule. I'll miss the wonderful team we've built, but I know that I'm wasting theirs and my time by staying. I wasted real value in my company by hoping my partner would change for much too long.

Take my advice, lay it on the line for them as a matter of priority, and if you don't get real commitment, get your head in your next opportunity ASAP. The team, the customers and everything you've built can't come to anything if you've correctly identified such a big structural failing in your company. Act on it! And good luck.