One of my blogging rules of thumb: if confronted with the same question several times in a short period of time, turn it into a post. So since several Homebrew founders have recently asked about bringing employees into Board meetings, here’s my answer (sans the crazy gesticulating you get from me in-person). As background, Satya and I are believers in the value of Boards post seed funding because it gives founders what we think of as ‘leadership momentum.’
- In general you want to keep Board meetings limited to Directors, official Observers and your lawyer (in Silicon Valley most lawyers will attend your Board meeting and serve as secretary without charging). Even when you invite others in, remember to leave time at the end for a Directors-only wrap up in case there’s any administrative matters that need to be approved (such as employee stock grants).
- Bringing in team members to demo, speak to a specific issue or other reason is fine. Do this spur of the moment only on extreme occasions – better to add to the agenda and let the person know in advance. I’m definitely an advocate of giving people the chance to talk about their work. Nothing can be more frustrating than having your work represented by someone else since you weren’t allowed in the room. This is a corrosive element at large companies that doesn’t need to be part of startups.
- Make sure the invited attendee doesn’t over-prepare. People want to do a good job and especially if they haven’t attended one before a Board meetings can sometimes be thought of as a BOARD MEETING!!!! A chance to shine or impress investors. We stress to founders that seed stage Board meetings are about dashboards and discussions. Not fancy slides, not decision making, not pontificating (by founders or investors!).
- Timebox the specific topic and once done, restore the room to its original composition.
- Founders should prep the Board as to what they want to impart upon the employee. Use us to deliver a message – usually a supportive one – but be specific on what you want the outcome to look like. That said, I don’t believe in surprise attacks. Don’t say “Tim has been slacking off, I need you to ream him at the Board meeting.” If you’re having a problem with Tim, and you’ve already conveyed this to him without improvement, I’m happy to 1:1 with him if necessary but a Board meeting is not the right setting. I am happy to emphasize the importance of a deadline or goal to an employee – turn it into something constructive and make sure sense of urgency/commitment is high. [again, we're talking early stage companies]
- Don’t get in the habit of inviting exec(s) into the Board room consistently just to make them feel included. This is a trap for two reasons. Firstly, your normal operating environment should be created to solve this inclusion. Inviting someone into a Board meeting as a looksee isn’t a solution. Instead look at what’s going on in your day-to-day that’s making someone feel distant from decision making. And how to share the Board materials/feedback/discussion with the entire team. Second, once you hit your A round of financing, your Board room dynamics will change and you’ll have to disinvite these employees. Although it’s logical to you it can still feel like a slight – “what, I was ‘in’ and now I’m ‘out?'” (sidenote: this happened to me as an employee once).
Ok, I think that’s most of my standard response to this question. Thoughts?