A startup founder has to wear many hats. Convening a Board is just one of the many, many tasks facing a founder, but it is arguably one of the most critical that can make – or break – a fledgling company. Getting it right at the start will not only prevent future governance errors, but also has the potential to become one of the most powerful engines for the growth of your startup.
What should your Board do for you?
A good Board is where the ultimate responsibility for company performance rests. By setting and guiding a company’s strategic direction; regularly measuring performance; and setting governance structures and holding the company to them, the Board is your strongest tool to ensure your company is on a path to success.
Here are four tips that can be helpful to you when building the right Board for your early startup.
1. Choose the right people.
This seems obvious - however, you would be surprised how many mistakes can be made at this crucial starting point.
You don’t want to choose people who always agree with you. Instead, look for potential members who will be able to give you constructive advice. Advisers who are willing to push back when necessary are the kind of people that are interested in making your company grow.
For the founder-CEO at the early stages of a growing company, the Chair should offer some of the the the experience that the CEO lacks, and be willing to guide the Board as a team. Keeping a balanced harmony between the different forces on the Board is a specific skill set.
Tips on choosing a Chair:
- Find an expert in the most relevant field for your company – or someone who has experience in other fields, that will fill a key skill gap that exists for your company.
- Find people with connections, who know how to solve a situation through the support of their own professional network.
- Build a team that has a rich diversity of thought. With members who are open to listening and learning from each other, the Board will be able to co-create for the company’s benefit.
- Ensure that all members share principles of good governance.
2. Great communication is key.
As an early-stage founder, it is important to work towards putting your self-image aside so you are able to be honest and open with the Board, especially about those aspects of the company that are not performing at their best.
However, being ‘open’ doesn’t necessarily mean sharing every single detail of the company. There is a fine balance between the quantity and the quality of the information that you share with your Board members.
Here are a few tricks that are helpful:
- Organise regular meetings with your Chair and update her/him about progress as well as any difficulties that have arisen, being willing to ask for help.
- Make Board meetings simple and relevant. No-one has time to waste, so create an agenda for each meeting and stick to it.
- Create regular communication pieces to keep Board members well informed about what is happening in the company.
3. Aim to build trust and mutual collaboration.
Just as in our personal relationships, trust is what keeps everything working in the most harmonious way. As a CEO, you should work towards creating an environment for this trust to grow naturally within the Board. Being open and honest, and soliciting open honest feedback and advice, is the foundation stone. Keeping the Board informed of all major developments, good and bad, as they happen, is really important and the reason they are there.
Mutual collaboration is also crucial. There is nothing more dangerous for a company than to have conflict within the board. People don’t need to like each other but they must prioritise the company’s health beyond any personal differences. It is your job as the CEO, along with your Chair, to invite your Board to work together toward a bigger purpose, and to create a collaborative atmosphere where ideas and potential solutions can be shared and respected.
4. Be coachable.
Humility and a willingness to take on constructive criticism are excellent traits with which to approach your Board. The boardroom can be a great classroom for all the members, but to make it so, one must be open to receiving the advice that is given. By being open to learning from others’ experience, you will have the opportunity to put things into practice and find out for yourself what is best for your company.