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Why Board Meetings Suck and What You Can Do to Make Them Better

June 29, 2015

Board Meetings SuckCompany Boards, whether they are Advisory Boards or Board of Directors, are often a big challenge.  Every company starts with an Advisory Board, which does what the names states – Advise, and eventually creates a Board of Directors generally made up of people invested in the company – officers of the company and VCs.

I’m on several Advisory Boards, have been on a few Board of Directors, and have reported and presented to Board of Directors for most of my career.  As I reflect back on my interactions the more convinced I am that the traditional Board Model is broken, for both the company and the advisors.

Until we start changing the way we approach board meetings they will continue to be bored meetings.

Advisory Board

Let’s start with the Advisory Board.  I’ve noticed that Founders and CEOs have trouble getting tangible value from their Advisory Board given the relationships with the advisors are typically 2+ years in length and often exist around no more than handful of coffee meetings.  Even formal quarterly meetings produce little benefit.  A vast majority of startups have 5 to 10 general advisors who take equity and end up as nothing more than names on a slide deck. There aren’t specific deliverables or standardized ways to work together. No one knows what fair economics look like.

And it’s not any better for advisors.  For me, I find that it’s hard to find the right entrepreneurs to work with.  For others, I’ve heard that, “It’s too much of a time commitment” or “It’s unclear what role I should play.”

In most cases, it ends up being expensive, wasteful, and frustrating for everyone involved.

Board of Directors

As a Board member I found the quarterly Board Meetings boring.  The CEO would standup in front of the room and tell us what happened in the last quarter and what it looks like for the next quarter.  I was never really sure how much I wasn’t being told that I should know.

As an Executive of a technology company, presenting in the Board meetings was stressful and the meetings were always too long.  I felt like the Board members didn’t really care what I was presenting or they were judging me and the company. Rarely was I convinced the Board members really took the time to read the material for the meeting in advance.  They were there simply to listen.

So the board meetings weren’t productive for anyone.

Why Meetings Suck

First, let’s identify WHY Board and Advisory Meetings suck.

  1. Board meetings are long, grueling, and hard to focus.
  2. It’s nearly impossible to capture your company’s story accurately when you’re obligated to only talk about certain things, i.e. how money’s getting spent.
  3. You can’t always get who you want on your board of directors. Sometimes you have a choice, but most of the time one or two members will not have been your first pick and there’s nothing you can do about it.
  4. Too many boards are too big, and too many board members invite observers and general hangers on — all who want to chime in with something to sound smart.
  5. If you present a deck from the front of a boardroom, you’re asking to be judged and picked apart. It’s like you’re pitching your company all over again, only this time to people who can take it away from you.

But it doesn’t have to be this way. When you think about it, each of these issues has a logical response. And it starts with one key learning: Every single entrepreneur forgets that the board works for them

The Board Works For You

Too often the CEOs are in these meetings getting their asses kicked and walking out with even more work to do.  They feel like they have to prove their vision instead of proving that everyone in the room should be working together to solve the problem. As the CEO, you feel like it’s your job to carry the ball across the line, but it’s also the board’s job too.This means changing your mindset from thinking you have to have all the answers for them and instead thinking about the questions you want their input on

There are really only four things a board needs to consider:

  1. Has the market changed since we last met? If so, did it affect us negatively or positively?
  2. Has the team changed? For better or worse?
  3. Has our position in the market changed?
  4. Did we do what we said we would?

That’s all the board should be concerned about. Not whether the product should have a button over here or over there. Just deal with the macroeconomics and team development.

Assign Work

It is a good thing to give Board Members (Directors and Advisors) action items.  In fact, as a Board Member, I want to help.  I want to do something.  I don’t want to just sit there and listen.

Most of the time, work assigned from the meetings is only in one direction: from the board to the CEO. But realize that the board is there to help and not just to judge. Get much better at asking for help and you’ll find that the harder the board works for your company, the better it functions at all levels.

It’s very easy to enter into a board meeting imagining all the VCs on your board are wondering why they made this investment. But, at this point it’s just too bad. They’re already in the game. It may be true that you’re not the CEO they thought you’d be. It doesn’t matter. They may always believe the company should be better than it actually is. But it doesn’t matter. You’re in it together and can do great things, so find a way to make it happen.

How to Run a Smooth Board Meeting

Stop presenting at board meetings. TALK with the board. Have a conversation. Tee up some meaty questions and wrestle those answers to the ground. This goes for you entrepreneurs too. Talk with your advisory board about the things that concern you and get their input. You don’t need a PowerPoint to have that discussion.

If you want to run a smooth board meeting you need to:

  1. Meet with each board member separately for 30 to 45 minutes in advance so you know how they’re going to vote, what they think about the agenda, and bust any potential issues or surprises. You can even go so far as to tell them, “We’ll talk about this. This is my big issue. This is where I think we should come out on it. What do you think?’”
  2. Compile comprehensive materials, data, and updates in a packet and distribute it to your board members at least four days beforehand. Tell them to come prepared.
  3. Do dinner or lunch before the board meeting, and include some of your key leaders. This will allow you to keep the meeting on time and it gave will give your board the opportunity to get to know key people outside the high pressure environment of the meeting itself.
  4. For the actual meeting, budget three hours, but only 90 minutes of content, including a 45 minute deep dive on an issue that you actually need the board’s help to resolve. Don’t make a deck — everyone should have brought their board packets with them — and don’t stand at the front of the room. Sit at the table just like everyone else.

The Board Pack

In order to make the board meetings more productive, more work needs to be done in advance.  And that includes the material provided to the board and it needs to be comprehensive but focused.

Sending a dull packet of PowerPoint slides full of charts, graphs, and bullet points just isn’t enough.  Slides are too ambiguous for a board to digest, and they’ll just end up asking questions based on how they’re interpreting them.

The board pack should be no more than 5 pages and written in a very comprehensive, journalistic style.  Getting down to those 5 pages is really hard, and will force you and the board to focus only what is truly important. And get the pack to the board 4 days in advance of the meeting.  You can deal with any last minute updates in the meeting itself.

Slide Deck format on the left, and Comprehensive Content format on the right

Slide Deck format on the left, and Comprehensive Content format on the right

When you start the meeting, instead of giving an opening spiel, simply refer to the board pack, flipping through as speedily as possible. Don’t talk about the data, it’s all right there in front of them. Just start in, “Any questions on the dashboard? No? Okay. On the grant? Okay. Let’s approve these items. Any questions on the financials? Okay, great. Now here are a few things we’re proud of that I want to highlight, and a few things we’re nervous about that we should discuss.”

That’s the whole shebang.

Make your board work for you.  It’s better for both sides.

Steve Blank, one of the founders of the Lean Startup concept, wrote two provocative posts about board meetings. Both are really good:

p.s.

If you’re wondering how you build a company that you can sell for a premium in a few years, contact me to discuss the Valuation Amplification Process.

I also invite you to download the white paper and learn the 5 step process on How to Quickly Increase Your Valuation: a Proven 5 Step Process.  http://www.therevenuegroup.net/free-offer.html

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