Post on 14-Sep-2014
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www.firewerks.co
Governance for Start-ups
Richard Hughes-Jones
31st
July 2014
ABOUT ME
www.firewerks.co
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WHAT ARE WE
GOING TO
TALK ABOUT?
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• Setting the scene
• Why do you need a Board?
• How to build a Board
• How to manage a Board
SETTING THE
SCENE
It’s all change in the start-up world...
Are Boards still relevant?
Decision-making hierarchies
are not a new concept
“Boards are important. They might not do the day to day
work of company building but they set the tone at the top”
“The group that the CEO reports
to has a big impact on the CEO’s
mindset which trickles down”
Fred Wilson
Credit: Mark Suster ‘It’s morning in VC’ on slidehare
WHY DO YOU
NEED A
BOARD?
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The functions of an early-stage Board:
• Sparring partner & ratification of key strategic decisions
• Reviewing financial & operational performance
• Mentorship
• Planning and dealing with extra-ordinary events: M&A, fund raising, crises
• Providing introductions, network effects etc
http://www.bothsidesofthetable.com/2014/01/06/how-boards-need-to-evolve-over-time/
BUILDING
YOUR BOARD
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Experience Competence
Personality Network
The
Perfect
Board?
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In the early days:
• Series A – Founder/s / VC/s / Independent
• Nature of Board control / relationships is changing
• Remember you are not just taking investors money
As the business grows:
• More investors
• Sector experts - a CEO from a comparative venture?
• As your company grows so do your Board needs
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• Write a Job Spec:
• What expertise are you looking for – operating / market sales etc?
• Ensure rapport and shared Vision for the business
• What personal value will the Board member bring you?
• Write a long list of potential candidates and filter
• Use your network
• Take your time to get it right – months not weeks
MANAGING A
BOARD
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• Get dates in the diary early
• Produce a clear Board Pack and retain style – not more than 10 slides
(plus Appendices if essential)
• Share content at least 3 days before
• Clearly define the top 3 strategic issues that you want to focus on
• Remember - a Board meeting is NOT an update meeting
BEFORE
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CEO
Update
Financials
Metrics
KPIs
Key
Strategic
Issues
Risk
Review
Wrap-up &
Actions
10% 10% 5% 15% 60%
2-3 hours (max)
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Pre-meet Board Members:
• Walk through your planned agenda & [Draft] Board Pack
• Get reaction to strategic topics you plan to cover
• Any Agenda items they would like to add?
• The Golden Rule of board meetings is no surprises
• The more time you spend educating your Board, the more valuable advice
you get from them
• ‘Managing’ a Board is all-encompassing – not just during the Board Meeting
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• Set a very clear agenda – and own it – you called this meeting remember
• Get feedback on key financials and metrics early in the meeting
• If clarification on numbers is required then take an Action to follow up
• Avoid scope creep and the meeting becoming a talking shop – facilitate
• Don’t let any one Board member dominate
• Don’t leave the most important item to the end
• How you manage your Board is (to them) a reflection of how you manage
your business
• Have a minute taker (great opportunity for rising star team member, if
appropriate) and allows CEO to retain focus
• REMEMBER: a Board Meeting is NOT an update meeting
DURING
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Dealing with difficult topics:
• Express options
• Highlight pros and cons (and associated costs)
• Express your opinion - you're expected to have an opinion
• Bring team members in if complicated / technical issues require summarising
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• Ensure the resources required to service the Board - if you haven't then ask
the Board for advice on how to get it
• Go for dinner afterwards - keep it social
• Frequency - monthly in years 1-2, every 6 weeks in years 2-4, bi-monthly or
quarterly thereafter
MEETING END / AFTER
• Record all important decisions:
• Summarize key decisions and actions agreed before you leave
• Senior individuals will want to see them acted upon by the time of the next
meeting (or if not, why not)
• Important decisions & Actions emailed next day - full minutes within week
TIPS &
TRICKS
Sophisticated investors and senior advisors
are surprisingly simple beings:
• Enough information to make an
informed decision
• Clear & succinct
• What’s the bottom line
• Best / worst case scenario
• Risks / mitigation
Manage expectations
You’re not expected to be an expert:
Individual entrepreneur to leading a team
If you’re not looking forward to your next Board
meeting then you are doing something wrong
THANK YOU
For Founders and C-team members, the
Strategy Workshop provides you with a
clear strategic roadmap for your
business
• Session One: big picture and Vision for the business, and business model canvas
• Session Two: strategic objectives are defined and potential actions identified
• Session Three: all options are ‘filtered’ into actionable and realistic outputs
“I left the [Strategy Workshop] feeling good, with a clear map of all the actions that
I need to be take over the next months... Another Workshop would be valuable pre-
series A, to clarify my thinking and focus”
Strategy Workshop
Founder & CEO, Lexoo: specialist lawyers
for start-ups and SMEs
http://www.firewerks.co/Strategy-
Workshop.html