Startup Board Meetings that Suck
I spend much of my life in board meetings. Most of these I relish as opportunities to do good work with management teams, but over the years I have also been tempted to grab a rope and hang myself.
Here are three sure-fire ways to destroy board meeting dynamics and increase the chances that your beloved VC end his days early.
Variant 1: The Weather Report
Bluntly, we’re not here to review what happened last month and what’s happening next month for three hours. Board time is too valuable for that.
It’s extremely comfortable for investors who like insanely detailed reporting on every little metric to keep asking for more to be included in the board pack until it’s bloated out of all proportion.
Conversely, it’s extremely easy for entrepreneurs who want to avoid discussing anything important to have 35 pages of reporting on everything from current results to revised forecasts to operational excellence or an excruciatingly detailed product roadmap.
None of this is helpful to decision making.
I once sat in a board room with a VC who would review travel expenses in minute details every month. The company was running out of cash at the tune of $500K a month and desperately needed to land a technical trial with a big telco. Way to focus on the right stuff.
I once sat in board room with a founder who told me: “I don’t disclose [a specific set of] KPIs to my board because I know they won’t get it and will make my life miserable. Instead, I expanded the financial reporting section to fully cover the time allocated to the business review”.
I felt for him, but I also didn’t buy it. Life’s too short and we’re here to build great companies !
The bottom line: good companies are run on a few metrics and an elegant framework for decision making. Death by slide decks is for losers.
Variant 2: The Oxford Union Debate
I can’t tell you how many board meetings I have sat in where extremely smart people sat locked for hours in highly engaging debates about the intricacies of (your choice of distraction) (a) the benefits of micro-services architectures (b) the proper way to run multi-variate testing (c) how to do accruals accounting (d) the proper running of an employee review process (e) the benefits of native over HMTL5 in mobile (f) whether the sign up button should be blue or red.
I usually learn a lot and enjoy myself, but no decisions get made. Take it offline. If you wanted to have great debates and demonstrate your verbal prowess, join the Oxford Union :-)
Variant 3: The Executive Team Show and Tell
Another pet peeve of mine is an easy trap to fall into; notably the board meeting that involves the entire executive team running through detailed update slides on their respective area.
Gorgeous slides which:
- they have clearly spent too much time preparing
- they are all keen to present in depth, and;
- elicit a ton of interesting questions from the board members.
Two and half hours later the all-important issue of CEO compensation is being dealt with in three and a half minutes because everyone has a plane to catch.
If you want your management team involved, by all means invite them, but make sure everyone understands it’s not about them; it’s about making good decisions that matter. Be inclusive, but don’t let that detract from your decision-making goals.
Investors should also be mindful that a board can be intimidating and that they need to foster an environment of trust and collaboration. I have witnessed first hand a senior sales exec being dragged into a board meeting to explain why his quota was missed. It was his first and almost last time in front of the board : he threatened to resign in the days that followed. The CEO, understandably, was thrilled.
In my next post I will look at what a good board meeting should be like. In the meantime, I will put my rope back in the drawer in the hope y’all have read this post and took it to heart. And feel free to disagree, just do it in 3 slides or less :-)