One of the most interesting parts of being a VC is the role we play as board members. After wrapping an active ‘board season’ it hit me just how much disparity exists in meetings across companies. The more board meetings I sit through, the more I notice key factors that differentiate between good and really good board sessions.
One key differentiator, among others which I’ll dive into below, is the use of time and how the meeting is structured. And, that’s not just my personal point of view, there are major financial impacts of poorly organized meetings as well.
To be honest, I think a lot of board meetings are lackluster. They’re scheduled for too long and don’t end up accomplishing half of what they could. In my experience, here’s how it usually works:
One week away from the board meeting, CEOs/founders remember they have a board meeting coming up. They then assign each cross-functional leader to create 3–5 slides with a functional update, and all of those different slides get stitched together a few days before the board convenes. The outcome of this cycle: board decks are too long, lack a cohesive story, and are centered around tactical updates rather than big strategic issues that need addressing.
With that in mind, below are my top do’s and don’ts of startup board meetings:
Do: Realize the board is on your side
The most experienced founders I work with realize that boards are not working against them. Once the term sheet is signed, we’re all on the same team. It’s amazing how quickly board meeting dynamics shift when this is the founder’s frame of mind — instead of a parade highlighting only what’s good, what’s working and what’s next, the meetings are centered around brainstorms and provoke healthy discussion with true, meaningful outcomes for the next quarter.
Don’t: Get defensive when receiving feedback
Don’t put something in front of your board if you don’t want questions to be asked. And, when those questions are asked, don’t get defensive. Or worse, don’t pretend to know something if you don’t — no board member wants BS.
Don’t take a week preparing a board deck full of vanity metrics and perfectly formatted slides. Instead, share the metrics you’re already using to run your business, and use the rest of the meeting to drive down on core issues.
Do: Pick the end in mind and work backward
The most productive board meetings I’ve been part of, start with the end goal(s) in mind and leave time for a brainstorm around strategic issues. Generally, that means the meeting and deck is organized as:
- Strategic framing of the business, state of the union, what’s working, what isn’t, what input is needed today
- Overview of administrative updates (options approvals, 409A updates, approval of meeting minutes, etc.
- Update on the business forecast and how we’re tracking on the plan
- Deeper dive into strategic issues (at least ⅓ of the meeting, ideally ½)
By addressing metrics upfront, board members can digest the “state of the state” discussion and use that information to prepare for the strategic discussion later on. This also communicates that you want to facilitate a healthy discussion on core issues — you want their expertise, opinions, feedback, and thoughts on how to proceed.
Don’t: Host a beauty contest of your best metrics
If I only see the best results, I assume you’re not telling me the whole story. The nature of startups is risk and hyper-growth, which means there’s always room for improvement. Instead of using your boards’ time to put on a dog and pony show, be straightforward about what’s broken and use the opportunity of having a range of experts in the room to arrive at a possible solution.
I can tell when the discussion is an orchestrated rehearsal — it usually includes a 60-page deck, a perfect presentation and no time for healthy discussion.
Do: Cover KPIs early on; share bad news ahead of time
A down quarter can be recovered. Missed revenue targets can be addressed. Retention issues can be fixed. From my perspective, if you missed your number one quarter, ask for a 30-minute call ahead of the board meeting and deal with it head on in advance so it doesn’t create an overhang over the entire meeting. in Seriously — the extra time up front will ultimately save you time and headache during and after the meeting.
I’m also a big proponent of thoughtful pre-reads and agendas three days ahead of the meeting, specifically around financials.
Don’t: Send your presentation the evening before
I don’t want to spend the evening before a board meeting speed reading a lengthy deck. Not only does that allot little-to-no time for your board members to gather their thoughts around the core issues that will be addressed, it also means we’re likely to be surprised by something and that’s going to be the first thing we want to discuss when the meeting kicks off, throwing off the agenda right out of the gate.
Do: Have a leader of the meeting
Appoint someone as the moderator and timekeeper — this can be the CEO, Chairman, Lead Director, etc. It’s a game changer to have someone in charge and keeping things on track (if you can’t run a meeting how can you run a business).
Don’t: Let one voice dominate the meeting
Allow for off-topic tangents and discussions that go off-track. This may mean you deviate from the agenda and stray from the meeting timeline, which is okay. Just be conscious of the deviation, frame tradeoffs, and leave time for the meaty topics at the end over tactical updates you can follow-up with via email.
Oh, and if the meeting ends early, it ends early (though this never seems to happen). No one is going to be mad about getting some time back in their day. I know I’m not alone in preferring a tight, organized, straightforward meeting over two-hours going through 80 slides of fluff metrics.
Ultimately, startup boards are just like a marriage — except harder and you’re stuck together indefinitely. Spend time getting your board right. Get the advisors and investors around the table that you essentially want to be married to, and be highly intentional about how you use your boards’ time.
Those are my top do’s and don’ts, what would you add to the list?
Originally published at https://cmovc.com on July 11, 2019.