I became really close to one of my employees, and this has created a truly bad environment in the office

I co-founded a rather successful e-commerce business in Europe. We are doing quite well, have been growing consistently for seven years. The thing is that about two years ago, my co-founder hired a coder who turned out to be really nice. In no time I realized we had a lot in common, so we became quite close, and grew a true friendship. At the beginning I tried to conceal this, and be as professional as I could around him in the office, but eventually last summer we went on holidays together, and pretty much everyone found out. Since then, on more than one occasion we started to have lunch together, or at one point my ex crashed my car and he would pick me up every morning to come to work.

From day one it was very clear between us that our friendship wouldn’t affect his work, especially since I have no major say in the tech department (I handle marketing, and cust support, my co-founder is our CTO, and we have hired a real pro to be our CEO). The thing is that lately I have noticed that many people in the staff have started to be quite resentful to this guy, even my co-founder seems to be holding a grudge against him. And I don’t really know what to do. Given his performance, I think he deserves a raise, as others before him have got it, but now both the CEO and my co-founder believe that while he’s good, we shouldn’t give him his raise because others will get upset.

I know this sounds childish, but I really don’t know what to do. Should I tell him to find another job? Should I pull my authority and promote him regardless of everybody else’s opinion? The truth is that I would like to keep him around, since he makes my days at the office far more enjoyable, but I don’t want to screw his career, or to create a bad environment in the office. I honestly thought I’d have many problems as a founder, but never one so trivial, that would cause so much stress.