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a16z Podcast | How to Lead, Not Manage Your Board
39 segments available
As the CEO of a startup your board is a critical tool in helping your company grow; the board is there to make you a better CEO. (Or at least it should be.) But how do you best leverage your board’s expertise -- both during meetings and outside scheduled time -- and what kind of people should fill the precious few slots you have? “Don’t end up with one of those boards with six VCs on it,” says a16z General Partner Scott Weiss. Seems like strange advice coming from a VC, but the point, Weiss says, is to have a balance of people on your board -- especially in the early stages of a company. “For every VC you have, add a CEO -- that’s how you get that outside perspective.” Weiss is joined in this segment of the podcast by former Chairman and CEO of 3Com (and a16z Board Partner) Bill Krause; Box co-founder and CEO Aaron Levie; Zillow CEO Spencer Rascoff; and former CEO and Chairman of NetApp Dan Warmenhoven to discuss the practicalities of building and leading boards over the lifetime of a company -- from early days to prepping for an IPO.
Segments Timeline
Introducing the Board Experts
In this segment, Scott Weiss introduces himself and the other panelists, sharing their extensive board experience. Each participant highlights their background, including their roles as CEOs and board members, setting the stage for a discussion on effective board management.
"maybe we should just start with introductions and to get a sense for board experience etc my name is Scott Weiss I'm a general partner here to a 16z but prior to that I was the founder and CEO of a co..."
The Importance of Diverse Board Composition
Scott Weiss emphasizes the significance of having a balanced board composition, suggesting that for every VC, a CEO should be added to provide diverse perspectives. This approach helps in avoiding boards dominated by VCs, which can limit strategic insights.
"questions sure so I'm Dan Harmon heaven for 15 years or so I was a CEO of NetApp and then continued I was executive chairman for law in terms of non NetApp boards and probably on about 10 or 12 roughl..."
Navigating Early Stage Board Dynamics
The panelists discuss the dynamics of early-stage boards, particularly the balance between VCs and operational leaders. They share insights on how to effectively manage board composition as companies transition from Series A to B and beyond.
"project for the CIA I've been on 15 public boards from Adobe to side base I've been on about 12 or 13 private boards most of whom have long since gone to I have to be here cool Aaron Levie CEO and co-..."
Lessons from Early Board Experiences
Scott Weiss shares a personal rule of thumb for board composition, advocating for a mix of VCs and CEOs. He reflects on his own experience of building a board that included both types of members, which he found beneficial for strategic decision-making.
"over time I'm Spencer raskov I'm co-founder and CEO of Zillow I am currently on four boards three public Zillow TripAdvisor and Zulily and one public julep sorry one private julep that's great so I ju..."
The Value of Independent Directors
The discussion shifts to the importance of having independent directors on early-stage boards. The panelists agree that independent perspectives can provide valuable insights and help navigate the complexities of startup growth.
"love to for the series a and Series B folks in the room I think maybe first talking about like what are some of the AHA around like when we're kind of think about early stage boards what if I want to ..."
Finding the Right Board Members
The panelists share strategies for selecting board members, emphasizing the need for individuals who can adapt and provide context for the company's evolving business model. They highlight the importance of flexibility over strict domain expertise in early stages.
"joined my board I'd add a CEO and so I ended up with two VCS as it turned out and three CEOs on my board and me and my co-founder which I thought was a really good mix and some of that's counterintuit..."
Building a Board for Future Growth
As companies grow, the panelists discuss the necessity of adding specialized board members who can address specific strategic gaps. They stress the importance of aligning board composition with the company's long-term vision and growth trajectory.
"round you can just say hey listen I've got my board together you know like and I have two CEOs I've got two VC's I really don't need another VC what I need is a financial expert for going public and s..."
The Role of Operating Experience
The conversation highlights the value of board members with operating experience, who can guide startups through transitions and pivots. The panelists agree that having experienced operators can significantly impact a company's evolution.
"having you know having somebody who's actually been an operating guy etc I think it's got a lot of value and they also can be me Thierry between the various venture capitals and ways of the CEO can't ..."
Strategic Board Composition for Series A and B
The panelists discuss the strategic considerations for board composition at Series A and B stages. They emphasize the need for a mix of skills and experiences that can support the company's growth and adapt to changing market conditions.
"you can start figuring out what the replacement strategies are going to be well so early stage boards when you have Don Valentine and dick cram like the founder of Nea on your board it's hard to add a..."
Transformative Board Members
The discussion focuses on the impact of transformative board members who can provide insights that lead to significant pivots in business strategy. The panelists share examples of how the right board member can influence a company's direction.
"kind of threw out that is kind of an important one for me that I want to give these guys but I want to get them some take home around like they're thinking about like what is the issues with boards an..."
Evolving Board Needs Over Time
As companies mature, the panelists discuss how board needs evolve. They highlight the importance of continuously assessing board composition to ensure it aligns with the company's strategic goals and market demands.
"ensuring so our series a board on we I don't know how to reverse engineer this so you could always kind of repeat it but we were very very fortunate where our first investor on the board understood so..."
The Balance of Generalists and Specialists
The panelists explore the balance between generalists and specialists on boards. They argue that while domain expertise becomes more critical as companies scale, having generalists with operational experience can provide essential guidance during early stages.
"actually led us to realizing on the the scale and sort of our you know the opportunity to to be able to go after and so I think it's a probably an important lesson where you know the obviously we'd yo..."
Preparing for Future Challenges
The conversation wraps up with a focus on preparing boards for future challenges. The panelists stress the importance of proactive planning and strategic foresight in board composition to navigate the complexities of growth and market changes.
"important now that doesn't mean somebody from a complete different sector but doesn't have to be that level of sort of the deepest domain expertise on day one I think you know we were lucky that at th..."
Building a Diverse Board
In this segment, the discussion revolves around the importance of having a diverse board of directors, akin to building a baseball team. Each member should bring different skills and perspectives, such as marketing, sales, and technology, to foster honest conversations and prepare the management team for board meetings.
"what they wound up shipping mm-hm and the same way the business model is not the same like you said you pivoted to a software company or whatever and you want somebody who's gone through some of those..."
Choosing the Right Venture Capitalist
The conversation shifts to the critical decision of selecting a venture capitalist for your board. It's emphasized that founders should consider the person behind the money, not just the brand of the VC firm, as the relationship will last for years and significantly impact board dynamics.
"really realize about all that was it's not necessarily that they are so expert on particular field that they're gonna like they move the needle on that particular issue because they're never going to ..."
The Importance of Reference Checking
This segment highlights the necessity of thorough reference checking when selecting board members, particularly venture capitalists. Founders are encouraged to reach out to previous colleagues of potential VCs to ensure they will contribute positively to board discussions.
"the VC kind of earlier stage you know person who understands so much about early stage growth companies and then we've got a real estate guy because we're in the real estate industry and so we've kind..."
Crafting Effective Board Meetings
The discussion focuses on what constitutes a great board meeting. The speakers emphasize the importance of preparation and how the CEO should serve the board with relevant information, ensuring that meetings are productive and focused on strategic discussions rather than mundane updates.
"what matters is who's in the board room for the next ten years and I've been on other boards with so with VCS from with really great brands who were the representative was just sort of annoying and no..."
Evolving Board Meeting Dynamics
As companies grow, the dynamics of board meetings evolve. This segment discusses how the focus shifts from internal operations to market strategies, emphasizing the need for boards to engage in meaningful discussions about customer connections and competitive challenges.
"you know if you put up a slide with a bunch of numbers they're gonna ask you about every single number on that slide right so what how do you guys think about preparing for a board minute again kind o..."
Key Guidelines for Board Leadership
The speakers share three high-level guidelines for leading a board effectively. They stress the importance of leading rather than managing, being transparent with information, and fostering open discussions to build a cohesive and high-performing board.
"high risk is and and so getting really good data about the customer connections and competitive issues and you know Jeff objections coming back from your target customer or whatever I mean that's that..."
Creating a Collaborative Board Culture
This segment discusses the significance of developing a collaborative culture within the board. Shared experiences, such as team-building activities, are highlighted as essential for fostering strong relationships and enhancing board performance.
"and so I find the best meetings of those which are very succinct around mundane and leave lots of time for the meaty subjects well I'm gonna offer three high-level general guidelines or rules of the r..."
Preparation for Board Meetings
The conversation shifts to practical tips for preparing board meeting materials. The speakers emphasize the importance of timely distribution of concise and compelling information, which reflects the CEO's ability to manage the company effectively.
"that was kind of fun but so that's so first thing is you know boards want to be led not managed second is is is don't your, board, they'll, see, right through it immediately you know practice the not..."
Leveraging Board Meetings for Accountability
In this segment, the speakers discuss how to leverage board meetings to drive accountability among executives. Including team members in discussions not only enhances communication but also provides valuable insights into the company's talent and operational challenges.
"presentations same thing I don't want to see a slide with 400 words on it how about just four or five I mean practice the Steve Jobs rule no powerpoints you know stand up and tell me what you think so..."
The Value of Joining Other Boards
The final segment emphasizes the benefits of joining other boards for personal growth and learning. The speakers share their experiences of attending board meetings of non-competitive companies to gain insights and improve their effectiveness as board members.
"of cadence of the business if you leverage it like that so first advice I would have would be if you have time I do think it's helpful to join other boards now you're probably not practical when you'r..."
Management Attendance: A Double-Edged Sword
The discussion focuses on the implications of inviting management to board meetings. The speakers caution that while it can be beneficial, it requires careful consideration to maintain the integrity of discussions and avoid complicating the dynamics of board meetings.
"it wasn't so sure about that switch it's worked well for us exam twice we've done it probably three times now I think and so what we do now is it you know it's like a twelve or fourteen page you know ..."
Best Practices for Board Meetings
The speakers share best practices for conducting effective board meetings, including the importance of having a session without the CEO to discuss performance candidly. They emphasize the need for transparency and open dialogue to ensure that board meetings are productive and focused on critical issues.
"to this other person because you haven't you would be shocked at how you know seriously people take this and then there are two good best practices that I have from other boards we actually don't do t..."
Creating a Culture of Transparency
In this segment, the speakers discuss the significance of fostering a culture of transparency within board meetings. They highlight the importance of addressing performance issues openly and ensuring that board members are engaged and invested in the company's success.
"that in addition to like when the directors have to get together like there is an issue it's not an odd thing that you're freaking out about right like it's just something that happens out of normal c..."
Signs of a Healthy vs. Dysfunctional Board Meeting
The conversation explores the characteristics of effective board meetings versus dysfunctional ones. The speakers outline the importance of avoiding surprises, maintaining active discussions, and ensuring that board meetings are a time for collaboration rather than mere reporting.
"and you look at your board members at people that care and are smart and are going to help you right like that's the energy that goes into the board me the other board did the kind of the dark board m..."
The Evolution of Board Size and Dynamics
The speakers reflect on how board size and dynamics evolve as companies grow. They discuss the challenges of maintaining intimacy in discussions as more stakeholders become involved and the importance of keeping board meetings focused and effective.
"like a general like like anvil that it's like or not even looks like a whip it's like it's it's a part of like of in what you're saying is a progress report comes and it's a sync like how are you doin..."
Navigating Boardroom Politics
In this segment, the speakers address the complexities of boardroom politics, particularly when external parties are involved. They share insights on managing relationships and ensuring that discussions remain productive and focused on the company's goals.
"questions going yeah so this is I think more series Amy but maybe even fingerboards you go with this you start out and you have like a really small board and then you have you've got you see sort of o..."
Navigating Customer Involvement
This segment addresses the complexities of having customers involved in board meetings. The speakers caution against allowing customers to attend, as it may hinder frank discussions about product issues. They recommend handling sensitive topics in closed sessions to ensure honest communication among board members.
"conversation in the closed session which is kind of a pain in the ass so like I think like partner like a junior partner that somebody is trying to to mentor as long as they're you know kind of quiet ..."
Effective Board Meeting Agendas
The speakers outline the structure of effective board meeting agendas, emphasizing the need for a clear division between administrative updates and strategic discussions. They advocate for concise operational updates to set the stage for deeper conversations about pressing issues, ensuring that board members come prepared to engage meaningfully.
"either every other month for series a once a quarters you get in a series see it's a very situational in terms of the frequency next question is well okay well what's the low and relative to frequency..."
Framing the Board Meeting
In this segment, the importance of framing board meetings is discussed. The speakers suggest that CEOs should start meetings by highlighting successes and challenges, which helps to guide the conversation. They stress the need for board members to be informed and engaged, ensuring that the meeting focuses on critical issues rather than administrative details.
"then you get into the prep and I think we covered the other things the preparation and the presentation material it passes somebody else so go back I want to make sure we get it to get to these questi..."
The Role of the Board vs. Personal Development
The speakers explore the distinction between the board's role in company success and the CEO's personal development. They emphasize that while the board is there to support the company, it is not the primary source for a CEO's growth. Instead, they encourage building a network of advisors for personal and professional development outside of board meetings.
"to okay I did find that that contradict what bill said army is it always went better when either I as a CEO or CEOs who are in meetings or I'm a director spend the first 10 or 15 minutes doing what yo..."
Expectations for Board Members
This segment discusses the expectations that should be set for board members before they join. The speakers highlight the importance of clarity regarding their roles and responsibilities, emphasizing that board members should be available to support the company's success in various capacities beyond just attending meetings.
"build up so the the board is is much more of the you know it's just a strategic function I think and then obviously making decisions around you know you know budget and and you know how you're how you..."
The Value of Diverse Perspectives
The conversation highlights the importance of having a mix of board members, including those with operational experience and CEOs who can provide valuable insights. The panelists argue that having a CEO on the board can serve as a de-facto coach, especially for early-stage companies navigating growth challenges.
"than that yeah and trying to just to pick up on that in terms of you know what you expect from a board member when I'd run a boy and I joined the board with the expectation I'm 24 by 7 now I can't be ..."
Navigating Sensitive Topics
In this segment, the panel discusses the types of questions and issues that CEOs may feel uncomfortable sharing with their board. They suggest that while board members can provide guidance, certain sensitive topics may be better suited for discussions with mentors or CEO coaches, emphasizing the need for a supportive network.
"know like and as I was growing up as a young CEO I wanted to be comfortable enough with them that I could ask them the stupid questions about like well hey I'm trying to close this guy how do I do thi..."
Learning from Experience
The panel reflects on the importance of learning from board members who have experienced both early-stage and later-stage challenges. They share anecdotes about how directors with early-stage experience can provide invaluable support during tough times, contrasting this with the limitations of board members from larger, established companies.
"or from other organizations do you just have age situational I mean people with large company experience can be helpful because they know what there's I mean show me a CEO doesn't want to build a big ..."
Effective Communication with the Board
The discussion turns to the importance of regular communication with board members. Panelists share strategies for keeping the board informed, such as sending monthly updates and sharing insights from customer interactions. They emphasize that consistent communication fosters transparency and keeps everyone aligned on company goals.
"later stage so I do think it's pretty helpful yeah I wrote a monthly I wrote I wrote a monthly board update letter right I just had the early stage a monthly update port coordinator now on the flip si..."
Leveraging Existing Communications
In this final segment, the panel discusses how CEOs can leverage existing communications to keep the board informed. They suggest using company-wide updates and insights from meetings to maintain engagement with board members, highlighting the importance of efficient communication strategies in fostering a strong board relationship.
"you're already producing you know the board is another constituent that you need to communicate to and I would also add that companies do too few communications to all internally anyway one of the thi..."