The board meeting needs re-imagination. At most companies, board meetings are either a source of angst for entrepreneurs and investors alike or a source of boredom for those who sit through hours of administrative minutiae. They are either too eventful or not eventful enough. Board meetings are an important communication vehicle and an important force in galvanizing the founders and the management team to step back and evaluate the business from the outside-in.
The perfect board meeting is a problem-solving session. It is a place where smart people with the “inside view” (the management & founders) and people with the “outside view” (investors and independent board members) can come together to solve the thorniest problems in a positive manner.
But lets start with the worst kinds of board meetings:
- “Peacock” board meetings: The peacock board meetings are spent with each individual around the table showing off. Investors may show-off how much pattern matching capability they have. They may be positioning against each other. Management shows off what an amazing job they’ve done. Neither party has a conversation, and the parties leave keeping a mental score of who won. Peacock board meetings are not only counter-productive, they set up the kind of adversarial relationships that are ultimately destructive.
- “Show your work” board meetings: In the “show your work” board meetings, every member of the management team comes through and fires up their powerpoint presentation. By the end of the session, everyone is bored and it feels like Physics 101 in a lecture hall of 500 people. No one gets anything out of the exercise and reading the textbook would have been just fine. In these meetings, everyone leaves with a lot of data, but very few people leave with any wisdom.
- “Administrative” board meetings: Many public boards have become largely administrative – focused on stock compensation plans and auditing guidelines. The boards no longer focus on the key strategic issues of the time. Instead they are focused on liability-protection and ensuring that the company doesn’t screw up, not concentrating on what it takes to enable the company to succeed.
- “Beat-down” board meetings: In the beat-down board meetings, members spend their time beating on the team. It becomes a venting exercise for the investors and an exercise in spin for the management. Beat-down board meetings destroy trust and ultimately cause decisions to be made for political reasons rather than value-creation reasons.
- “Tangent” board meetings: Tangent board meetings involve one or more board members hijacking the agenda to discuss a tangent. Often that tangent involves discussing something largely peripheral to the prospects of the business for really long periods of time. Tangent board meetings cause others in the room to check out and represent a terrible waste of time.
So lets get to the perfect board meeting – a meeting between equals, engaged in helping solve the most important issues of the day. The meeting may start with minutes and resolution approvals, but it moves on quickly from there. Next up is a reminder of what was discussed previously, how that ties into today’s agenda and what key decisions have been made by the company. Remember, board members are busy and on a lot of boards. It’s your job to remind them what was discussed and agreed upon. The key performance indicators and operating highlights are discussed – but not in a lot of detail, because they can be sent out in advance. It is important, however, that you not assume that every board member has read all of your material in advance. They likely haven’t; and a common baseline is needed to have a valuable strategic conversation. If you’re spending more than half your Board Meeting baselining, however, that’s too much.
Board members will typically care a lot about sales metrics, revenues, the executive team and financing. You’ll feel like you’re spending a disproportionate amount of time on those topics versus other things that you may care equally about (like product, engineering, culture or marketing programs). Get used to it. Your board meetings are not intended to be balanced portrayals of your mental space. The core of the board meeting should be centered on key strategic questions that you are struggling with: Which market to go after? When to raise money? What are the critical hires to make? How to deal with a macro threat? These are tough questions to discuss with a team of people who are not thinking about them every day the way you are. You will feel like you’re doing a lot of education. That’s OK. If you tee up the discussion well, you’ll get a forest-from-the-trees perspective from a number of the people in your boardroom. They will ask you questions that make you re-evaluate your priorities and your intuition. The best board members will not tell you what to do. But they will offer strong opinions. It’s your job to consolidate those points of view, arrive at a decision and ultimately communicate it back to them (except for the small number of things that actually require a board vote).
The best board meetings are passionate, respectful and inclusive. They are open to the key leaders in the company. They allow for disagreement without personal attacks. The best board meetings are also stage specific. I remember our first board meeting 6 years ago with Ajay Agarwal from Bain Capital Ventures. It was entirely focused on hiring engineers. We’ve since had board meetings focused on people and culture, or financing strategy or go-to-market productivity metrics or strategic priorities or vertical expansion. The topics have to reflect where you are as a business. The best board meetings are continuations of conversations – ideally, you’re speaking to your board members with enough regularity (typically more in the early life of a company than later) that they are not re-learning the business every time.
The best board meetings are brutally honest about the challenges the company faces – typically surfaced by the founders/management and not the investors. The best board meetings keep to the agenda and avoid the many rat-holes. The best board meetings have some amount of cheerleading built into them. Company-building is a marathon and every good marathoner needs cheering along the race. The cheerleading helps the investors stay positive through difficult times and more importantly, it will help you and your team feel like you are all on a special journey. The best board meetings are forcing functions for internal communication and re-evaluation.The process of identifying important topics and preparing materials should cause you to keep perspective on the company’s priorities in the middle of the inevitable operational fires. And they provide an opportunity to reflect those priorities back to your larger team during all-hands meetings or through other company communication vehicles.
By no means has every board meeting we’ve conducted at BloomReach been perfect. I can remember plenty where we were guilty of the “show your work” Board meetings. But we’ve gotten a lot better.
And it goes without saying that the prerequisite to the perfect board meeting is perfect board members. Pick wisely and the rest is learnable.