Right Board Members Essential For Success
“This isn’t the way a board should operate!” exclaimed my fellow board member.
“What’s the problem?” I asked.
“A board of directors shouldn’t be discussing detailed operational topics like this. We should be reviewing proposed strategy and the associated budgets,” he said.
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He got upset because we were discussing the best market to sell to and the best way to approach the market. This had us doing a full market analysis with a review of product, pricing and distribution channels.
My fellow board member believed this to be the responsibility of the CEO/founder and not the board. I believed he was dead wrong. Because of his objection to the process, I also believed he was the wrong guy for the board.
I said, “We aren’t Coca-Cola. We are a startup. This is exactly what we should be discussing, and we are the right people to be discussing it.”
The Startup’s Search
The startup’s goal is sustainability. Until the startup can generate the revenue needed to produce positive cash flow, it remains a startup. Once it achieves consistent positive cash flow, it then becomes a business.
A vital part of the startup becoming a business is the commitment and assistance of the startup’s board. Here are seven attributes to look for in a board member for your startup.
- Loves the Entrepreneur and Their Family. One of the loneliest jobs in the world is being an entrepreneur. For sanity and emotional security, the entrepreneur needs a founding board member who loves and cares about them and their family. This board member is in it for the entrepreneur as much as he is in it for the vision.
- Owns the Vision. The entrepreneur is all-in. He started his company because he couldn’t achieve his vision any other way. The board members must be compelled by the same vision. They want to be a part of making the entrepreneur’s vision a reality. This causes long-term commitment.
- Is a “What” or “How” Guy. There are people who are good at figuring out the best path to sustainability and know how to get there. You need both to fill your experience gaps as an entrepreneur.
- Have Startups In Their Blood. These are board members who get startups. They like dealing with the endless stream of seemingly intractable problems. They understand and enjoy working through big opportunities and big problems with few resources. They have the mind of a startup guy.
- Is Intelligent. All the board members must be intelligent. Time is the scarcest resource of the startup. To maximize time, you need people on the board who get concepts quickly, naturally focus on what is most important, and know when to contribute and when to shut up.
- Knows the Industry. Every industry is unique. It operates within an unspoken culture with unspoken guidelines. The entrepreneur should know this as he hopefully comes from the industry he is serving. But he must also have a board member who has industry experience and network. This will result in sound strategies and a faster start by leveraging the key players in the industry.
- Is a Gorilla Warfare Thinker. The startup board member must think like Navy Seals — small groups of exceptional people with few resources and killer instinct who accomplish high risk, surprise attacks. The startup cannot have full frontal attack thinkers as there are not enough resources to pull it off.
It is almost impossible to find one board member who embodies these seven attributes. The more these attributes are shared by the board, the greater the chance of success.
Startups have a short fuse. Achieve sustainability or die. You must have the best founding executive team and the best founding board. Be selective.