Nail your Board (Meeting)!

Tips for an Effective Board in Early-Stage Companies

Illustration generated by DALL-E 2

The importance of Boards

Boards matter!

  • Corollary 1: for this to work, relationships matter! You don’t need to be friends (although some cases do result in lasting friendships), but CEOs and Board members should invest time in cultivating a professional relationship of mutual trust and respect. Listen to and understand each other’s motivations and concerns. Do lunches. Have coffee.
  • Corollary 2: for this to work, information matters! Nobody can be helpful if he or she doesn’t have the necessary information about the company. Management should be transparent about the good and the bad — avoid surprises. It should equip Board members with the right data, and Board members are expected to be informed by the data provided when they opine on a matter. As the saying goes, “without data, you’re just another person with an opinion”!

A few guiding principles for an effective Board meeting

1. Board meetings are not reporting forums

  • Past performance data (financial, business metrics) needs to be sent out to the Board in advance — at least 72h — as part of the Board package;
  • If you have given enough time for the Board to have read it ahead of the meeting, you can and should expect that each member has read it;
  • At the Board meeting, have it ready in case of need, but don’t put it on your main flow (unless to make a specific point or inform a specific decision — and in that case, just the partial data that is needed). Ask if anyone has any question or wants to debate any aspect of it, and spend as much time as needed if clarifications are asked. If no questions, move on to the discussion stuff;
  • Standardise the format. Make sure you have a consistent way to provide the information. Agree on the key metrics to follow and provide a dashboard that becomes familiar to Board members. This ensures that they understand the information provided without needing to re-interpret each time, and it also minimizes the burden of preparation for you and the team compiling it — after all, it’s the metrics that you’re running the business against, not some numbers compiled just for the sake of the Board. In the metrics, make sure you include a comparison vs. plan (“Where we are vs. where we thought we would be”). Back-up the dashboard with more detailed reports as needed;
  • Precede that report with a CEO commentary if needed — particularly if there are meaningful deviations from the plan.

2. The CEO runs the show

  • Think ahead about what you’d like to achieve with each Board meeting; set the goals;
  • Not every Board meeting is about making a big decision…
    – …Sometimes, you need to provide some context and information on a given topic and just debate, get advice from the Board (e.g., how do we react to a key competitor’s movement? Do we need to adjust our pricing strategy?…)…
    – …Sometimes, you need the Board’s sign-off on something you plan to do, get approval of the Board (e.g., we need to approve the stock option allocation to a few key employees; we need to open a subsidiary in a given country;…)…
    – …Sometimes, you need the Board’s full engagement on a big existential question (e.g., fundraising strategy; M&A; Budget approval and budget re-basing;…);
    – Each Board meeting can be a combination of those cases, but make sure you’re not just in pure one-way presentation mode;
  • Own the agenda. Define the sequence of topics, allocate time according to what you think is appropriate. Share the agenda with all Board members, ahead of time, along with the information you’re sending as pre-reading materials (the “Board package”). Ask Board members if they’d like to include other topics and adapt, but be careful about scope creep…;
  • Think whether you want to bring in part of the management team, for at least part of the meeting — if there aren’t sensitive matters to discuss, it’s a great way to (a) engage and motivate the team, (b) get the Board members to meet the team, and (c) maybe get more color on some of the data points. But make sure you don’t let that exposure consume Board time you want to use for something else

3. Focus on what’s important

  • Housekeeping is a necessary evil of doing business. If you keep your house in order, there is less chance that it will creep into your Board meeting;
    – If house-keeping tasks can be kept off-Board meeting, keep them off-Board meeting (e.g., have the minutes from the prior meeting circulated and signed-off via email, ahead of the following Board meeting);
    – In any case, reserve the time for any required house-keeping measures, as needed
    You may have them at the beginning of the meeting — in which case you must make sure the time doesn’t run over so that you can move to what’s important;
    You may have them at the end of the meeting — in which case you must make sure you get that far, at the expense of accumulating a house-keeping backlog.
    (Who said life was easy?)
  • Keep Board meetings at a Board level;
    – Use them to amply debate the more strategic issues — product and go-to-market strategy, company performance, M&A, budget, Executive team hiring and compensation…
    – You can inform the Board on executive management matters — Sales and Marketing, HR, Finance, Engineering… (all of which your Board members will enjoy being informed about) — but if you ask your Board about the color of your new logo, you’ll get responses, and if then an hour is spent debating personal tastes, that’s on you!
  • If you need a decision to be made, try not to put it out as an open question. It’s often helpful to structure it as a choice between options a/b/c. Have a well justified management recommendation.

4. Pre-empt and follow-up

  • Send out an agenda ahead of the Board package. As you prepare to send it, or after you’ve sent it, give each Board member a call. Use the call to:
    – Make sure they have received and read the agenda, and that they will be prepared to discuss the matters at hand at the meeting;
    – Explain your rationale and what you’d like to communicate and achieve at the meeting;
    – Receive feedback on the agenda itself — or see if they have a concern in mind that you may have overlooked;
    – Pre-emptively discuss the matter at a high level and, if you’re seeking a decision, understand where each member stands with regards to that decision — that will make managing the meeting infinitely easier!
    – Identify missing pieces of data that will be relevant to have at the meeting (or sent out before) to better inform the discussion;
    – If you’ve planned an in-person meeting, confirm whether there are members planning to attend remotely — it does affect the dynamics.
  • Then follow-up with your complete Board package, at least 72h before the meeting.
  • Do the Board meeting! (duh!)
  • After the meeting, collect your thoughts and write a short note with conclusions and action points. No need for an essay. Simple, telegraphic, bullet points will suffice;
  • This is critical to make sure you align the understandings about the outcome of the meeting — you’d be surprised how different the perceptions may be and how quickly the recollections evolve or dissipate.
  • Finally, if applicable, do the minutes of the meeting shortly after — don’t let them accumulate!

5. Plan ahead

  • Depending on the stage of the company, you can be on monthly Board meetings (very early-stage), on quarterly meetings, or on any other periodicity that you and your Board are comfortable with. If the meetings are far apart, it’s probably a good idea to do more informal touch-base meetings in between. In any case, plan in (very) broad strokes what you think will be the scope of the discussions. For example, plan to discuss the budget for the following year at the Q4 Board meeting; do a deep dive on the business at the end of Q2; etc.;
  • Late in the year, propose a Board meetings calendar for the following year, when it’s still relatively easy to find slots where everyone is available. Send out calendar invites for the year to make sure everyone has them;
  • End each Board meeting with a confirmation of the date / time for the next Board meeting;

The Board meeting deck (not a template!)

Yeah, right, but…

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Armilar VP

Armilar is Portugal’s leading venture capital funds manager, an independent VC with a 20-year-old high-performance track record and an international footprint.