There’s a saying among VCs that the first board meeting after a new round of funding is when the skeletons come out of the closet. During the preceding pitch process, even founders who are highly transparent, honest folks try to put their startup in the best possible light for a new investor, so it’s only natural that a more complete picture of a company’s situation (warts and all) sometimes comes into focus after the round is closed and board meeting scheduled.
Personally, I think the first board meeting post-fundraise is less about the skeletons and more about founders and hands-on investors getting to work. We’ve previously shared our thoughts and sample slide templates for board meetings for seed stage startups as part of our Growth Guides series. If you haven’t checked those out, it’s worth doing so to get some ideas on agenda, format, content, and more, all for seed stage startup board meetings generally. But today I wanted to touch on the very first board meeting post fundraise in particular.
Here are a few things to think about heading into your first meeting:
Set the Tone
Obviously, founders and new VC investors have gotten to know each other during the investment process to some degree, and in some cases they have had a longer term relationship prior to the round. In most situations, however, the two sides are working together for the first time. Thus, an important part of the first board meeting is simply setting the tone for a long term working relationship. Founders can use this first meeting to get a sense of what kind of input and advice you’ll get from your board members, now that neither of you are trying to “sell” the other.
Keep in mind that the purpose of your board, whether investor board members or independent board members, is to help the company by providing advice, making introductions, challenging assumptions, and generally pushing the CEO and senior leaders to build the best company possible. Board members have a fiduciary duty to look out for the interests of all shareholders specifically (and employees and other stakeholders generally). As a startup founder/CEO, your goal shouldn’t just be to keep your board members happy — it’s to utilize their feedback and leverage their expertise to build the best business possible.
Think Long Term
Some portion of all startup board meetings do involve basic updating and corporate governance housekeeping. As we described in our startup board deck series, the goal should be to use the bulk of the board meeting time to tackle one or two key issues facing the company. These could be a near-term challenge or opportunity, but I find it’s useful to spend even a small portion of the first meeting reiterating and refining the long term goals and objectives. (For seed stage companies, that means one-plus years out.)
This helps keep those long term objectives top of mind for all board members, and the first board meeting after a new round is a useful time to evaluate these goals and see how aligned all perspectives are.
Future Draft Picks
Even when your board and startup are in the early phases, it’s worth starting to think about your board as a basketball team. You don’t want five point guards or five centers; you want a reasonably well-rounded squad.
Startup boards are no different. Members will have different expertise, relationship networks, and personalities. At the seed round or Series A stage, you may have a very small, informal board of a couple co-founders and one investor or perhaps four or five total individuals at most. But it’s worth assessing what sort of people you have even early on so you can be intentional about adding others (or changing some out) in different seats as the company grows.
It may be useful to have a person who acts as devil’s advocate or one who’s more aligned with founders or one who consistently pushes the company to think bigger. But if you have five cheerleaders or five devil’s advocates, you end up with groupthink and an unproductive board in the long run.
In the end, seed capital can help a startup get the best possible start in many cases. Running your first board meeting with the concepts above in mind can only improve those crucial and formative, first few months.
If you wanted to browse our board deck template, you can find that embedded from SlideShare below.