Why startup founders must focus on efficacy, not efficiency during board meetings
In this episode of Prime Knowledge series, Shripati Acharya, Managing Partner of Prime Venture Partners, talks about why board meetings are vital for startups and what members expect from founders to contribute positively to the company.
Even while running a seed-stage startup, founders often have a lot on their plate. This includes board meetings, which typically comprise investors and stakeholders. New to the business, many founders tend to miss out on the very essence of these meetings.
They either delay or avoid to keep control of the company or make them outine update sessions to feed members only with information on success. But it is the board that can convert a founder into a true CEO.
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Shripati Acharya, Managing Partner at Prime Venture Partners, says,
“With effective board meetings, founders can strategically maneuver their businesses to the pinnacles of triumph, and achieve those end goals that everyone ultimately desires to see.”
For this, Shripati endorses four things that board members expect from their founders to contribute positively to the company.
Preparing for the meeting
If founders come prepared for the board meetings like they do for their startup pitches, a lot of value can be derived from those sessions. However, the preparations cannot be one-sided; board members also need to do their research and analysis, to provide valuable inputs to the founder about the decisions to be discussed.
Creating a presentation or PDF and circulating it among the members a few days ahead gives the board some time to ponder on the facts that are going to be presented. Once in the room, the discussions can ensue with a solid base of information available to everyone, with hardly any member being in the dark.
When all minds have their own perspectives, the meetings automatically turn into something effective.
Declaration of the agenda
A meeting without a clear agenda is like a running train with no clear destination. Everyone has prepared, but no one knows for what. You have stated a lot of facts, but the motive is unclear.
An efficient practice is to send the agenda of the upcoming board meeting in the email where you are attaching your presentation and PDF, and being clear about the goals of the discussions.
Is the company planning to allocate an extraordinary budget? Is buying another company on the cards? Does a product require another round of heavy investments, or is there a need for another C-suite position?
The board meeting is where founders can discuss and brainstorm major business decisions. Declaring the agenda makes the meetings productive as every member stay on track.
No secrets in the bag
Investors and stakeholders do like to hear positive stories from an enthusiastic founder, but that does not mean they want to stay in the dark on negative ones. That said, it is always a disappointment to board members when founders reveal all failures directly at the meetings without a heads-up. They want to help.
They look to contribute to the firm’s progression owing to the stakes they hold. If something went south and you have to reveal it to the board, do it in your agenda email or as and when it happened. Then, the discussion can be about how to save the ship from sinking rather than why the board was not informed earlier and everyone can stay on the same page.
The board is the founder’s asset and using its expertise efficiently is what builds a CEO.
Follow up after the meeting
A meeting is never complete without a follow-up session. Founders need to document their board meetings for a variety of reasons, and they need to use these documents to create effective follow-ups.
One strategy can be to send every member a follow-up email, clearly stating the outcomes and decisions of the meeting and re-emphasising the agreements that the board concluded on.
Another way is to include important pointers of the last meeting in the next one so that the board can pick up from where things were left off. A continuation quickly brings members on board. Follow-ups rejuvenate memories and create a base for the next discussion.
Shripati says, “Just like your startup pitch and meeting preparations, your follow-ups should hold similar depth as well.”
These work together to make the board meetings structured. The chances of conflict are also fewer as there is no room for confusions. Board meetings are one area where efficiency cannot be the primary goal; effectiveness is what drives value.
(Edited by Megha Reddy)
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