Startup Boards by Mark Suster

  • Source link: https://bothsidesofthetable.com/startup-boards-ee3ad0389040
  • TL;DR: The board comes up with the broader strategic direction in which the company moves, and the management executes that strategy
  • How helpful?:4/5
  • Topic Tags: Board of directors, management, protective provisions, governance
  • Relevant questions addressed:
  • How do the roles of management and the board differ?
  • How does the board set the framework for management to make decisions?
  • Summary bullet points
  • Certain board actions, like raising new capital, require “shareholder consent”
    • These are often called “protective provisions”
  • Role of management: run day-to-day business, make decisions within the framework agreed between management and the board
  • Role of the board:
    • Come up with budget and strategy
    • Periodically (usually quarterly) review progress and make adjustments
    • Audit
    • Manage compensation for executives
    • Vote on key considerations
      • Budgets, financings, legal issues, hiring/firing CEO