Maximizing Board Meeting Value
Suggestions for Managing Your Board
Both early-stage founders and investors often complain about board meetings, but it doesn’t have to be that way. These can be some of the most valuable interactions for the strategic leaders of your start-up if you prepare for and execute board meetings optimally. Here is how we recommend maximizing the value of your board meetings.
To start, it is important to identify your outcomes for the meeting. There are usually four outcomes:
- Update board members on progress
- Discuss strategic questions for feedback
- Align on your upcoming outcomes
- Approve options grants or other board matters
We suggest handling outcomes one and four outside of the meeting. Specifically, your board deck should have the updates sufficiently well covered and distributed in advance (e.g. 5–10 days), such that directors review the updates and ask questions over email in advance of the meeting. And for four, a clear unanimous action by written consent over email is preferable to using limited in-person time for any small or repeated approval topics. Below are tips for handling each of the four outcomes above.
Here is a template format for your board slides on updates.
Slide 1: Year Outcomes
Remind directors of the top five outcomes (revenue, cash, hiring, product, tech) for the current year and include one sentence on progress on each relative to expectations.
Slide 2: Quarter Outcomes
Recap directors of the top five outcomes for the current quarter and include whether complete, in progress or off track.
Slide 3: Revenue Outcomes
Show projected vs. actual sales and a list of top clients won. For any disparity, explain the lesson and what is being done to correct it.
Slide 4: Cash Outcomes
Show projected vs. actual cashflow and for any discrepancy provide the reason. Include any financings that should be celebrated from the most recent period.
Slide 5: Hiring Outcomes
Show current org chart and highlight any new additions recently on-boarded. Also, mention any asks for help in recruiting.
Slides 6–9: Product and Tech Outcomes
These should be the most customized from company to company. Remember, a picture is worth 1000 words wherever possible. Also, provide a link to a product demo or video if possible so directors can interact in a tangible way.
It is important to set the expectation with directors to read these updates before the meeting and to send any questions about them in advance of the meeting. This also requires advanced preparation of these updates (at least 5 days, preferably more than a week).
The majority of the meeting (~2/3) should be two or three major strategic questions you want to brainstorm about with the board. Example questions include:
Should we stay focused on the current product and/or add another? What creative ways can we accelerate revenue growth? What senior executives are we planning to add to the team soon? When should we be fundraising? What M&A options should we be considering? How should we update our compensation policies for the team or for key executives?
Obviously, there will be many other questions and a wide range of subtleties in the strategic considerations to evaluate as a board. The important thing is that these get distributed with the updates a week before the meeting and that each director comes prepared to discuss these. Also, for many of these, other members of the management team beyond the CEO or founder should be present to participate.
The CEO should bring proposed outcomes for the next quarter (and year if it is the last meeting of the year). Ideally, these have been worked on with the management team and the key leaders at the company actually present the particular outcomes they will own (e.g. the VP of Sales shares the revenue target).
Discussion of these new outcomes should be the other main topic (other than strategy) for the board. Again, these should be included in the board materials sent in advance for directors to come prepared with specific questions and feedback. Typically, a financial model should be distributed as well and serve as a quantitative framework for considering the new proposed outcomes.
We also like ending each board meeting with feedback on the current meeting (what was great and what could be improved).
Here is a template options grant approval. Note that for every grant, not only the person’s name and number of options is provided, but also the fully diluted percentage and the role — and how much total ownership that individual already has before this grant. This is crucial context for directors considering approvals. Also, don’t forget to share the total number of options in the pool, and how many will be left for issuance after these grants.
Good luck preparing for and running your next board meeting!
Prime Movers Lab invests in breakthrough scientific startups founded by Prime Movers, the inventors who transform billions of lives. We invest in seed-stage companies reinventing energy, transportation, infrastructure, manufacturing, human augmentation and computing.