By Bernie Dixon, Founder and Chair, LP2X USA

The journey for an early-stage CEO can be lonely. It is filled with the ups and downs of unexpected stresses, successes, decision making and constant issue grenades landing on your lap. Very few people can empathize with you.

Let’s say you are in your car leaving an industry summit meeting where you gave a powerful presentation. You nailed it. You wowed the audience. You gave insightful answers to their questions. Afterwards you were approached by two other CEOs of early-stage companies who are excited and pushing for a “partnership” with their companies. You are bursting with excitement with the connections you’ve made and the opportunity to partner. But what does that mean? How do you go about partnering? What’s the upside? The downside? The next step? Who can you talk to? Your contractor employees have a limited grasp of the growth strategy for the company; your part-time CFO will want to know about the financial structure, your attorney is very expensive to use for an open-ended discussion and your friends really don’t get what you are going through with the company changes. Where do you turn for advice and counsel?

An important part of the CEO journey is surrounding yourself with the best minds, experience and coaching you can find. Your Board of Directors is an important part of this journey. 

It is often suggested that early-stage companies need to think about forming a Board only once it has been decided to raise their first round of capital. Nevertheless, the benefits of forming a Board earlier in the lifecycle of a company, irrespective of a capital raise are undeniable.

We will discuss the formulation and composition of your Board in another piece. For now, I’m suggesting how to get breakthrough results with your Board in three areas to benefit your company: 

  • Big Picture Outlook and Strategy
  • Reporting and Calibration 
  • Leadership and Company Building

What is NOT on this top 3 list is day to day operations of your company. Your Board does not need to be involved in the day-to-day issues you are handling with your customers, suppliers, and employees. (There are a few exceptions where you will want to pull in key Board members based on their specific expertise like pricing a contract) Reserve time with resources like your chief operating officer, key salesperson or CFO for those issues and save your Board for the larger, more complex, and sophisticated issues.  

Big Picture Strategy – Use your Board to flesh out strategic issues. This is the key role of the Board. If you have selected the right Board members for their industry knowledge, expertise in raising capital or mergers and acquisitions you will have a sound bank of knowledge to lean on for strategic discussions. Founders/CEOs should carefully craft conversations with the Board to handle only 1 or 2 central strategic issues per meeting or discussion. Some topics at the early-stage level may include items such as competition, pricing, product differentiation, distribution, or partnerships. 

Reporting and Calibration – Directors on all Boards have the responsibility to stay informed. That includes company financial performance (such as unit economics, cash flow, etc.); product development in terms of cost, cycle time, supplier issues; and the status of fund raising such as current offering, follow up and potential investor moves. I consider it a waste of time to review all company metrics at Board meetings preferring to have communications sent to the Board members a few days before the Board meetings in order to allow Board members to digest the information and thereby provide more ideas, feedback and coaching during the meeting and enhancing their Boards ability to enhance the company.

Leadership and Company Building –Your Board is an immensely valuable resource for your own professional development. Select one or two Board members, preferably your Board Chair to personally mentor you and be available in discussing difficult situations or approaches to managing the company. Again, if you have selected the appropriate Board members you will have accrued experience and knowledge well beyond your own capacity and that you can depend on to hone your performance and your company results.

I encourage you to seek to work collaboratively with your greater team and making them part of the Board process. You can bring a senior member of your team to a Board meeting to not only share their expertise and insights but also to witness the value of the combined talent and expertise of the Board as a company resource. The lead for product development can attend a Board meeting to discuss product issues and roll out. Your CFO can discuss cash flow projections. The VP of sales can outline the sales pipeline for the next quarter. It is a useful process to develop strategic thinking and leadership skills within your company.

Final thoughts

Let’s be frank. The role of your Board members is not simply to agree with you and confirm your course of action. Every CEO needs bright minds that will challenge their thinking and work for the benefit of the organization. As the CEO you are ultimately responsible for the company strategy, performance, and the day-to-day operations. Why not increase your potential performance by selecting and surrounding yourself with the best minds, experience and coaching you can find? 

You recognize more than anyone else how dynamic and fast past early-stage companies are. This article sets out to assist you in getting breakthrough performance by managing your Board and running Board meetings with big picture strategy, reporting and calibration, and leadership and company building in mind. CEO’s can enhance their own performance by keeping these principles top of mind and realizing the value of a Board who challenges their thinking and works to add value at every stage in the company lifecycle.