The probing truth about great CEOs
Meg Whitman Has A Few Questions For You Hewlett-Packard’s chief executive officer, Meg Whitman, seldom tells people what to do….
Meg Whitman Has A Few Questions For You Hewlett-Packard’s chief executive officer, Meg Whitman, seldom tells people what to do….
I’ve recently discussed how CEOs need to own the vision and provide the proper resources. Another key responsibility is to…
Steve Blank: Don’t Give Away Your Board Seats
Brad Feld: Start Building Your Board Early
This week in The Wall Street Journal blog “The Accelerators,” Brad Feld and Steve Blank wrote articles taking opposing sides about when early stage founders should start developing their boards. Steve Blank advises against giving away board seats too early and instead concentrating on building an advisory board, which has less power and fiduciary duties. This way, the founders don’t give up too much control too quickly but still receive the benefit of professional advice from experienced people.
On the other hand, Brad Feld advises founders to start creating their boards as soon as possible. The legal responsibilities of board directors make the position more serious, strengthening their commitment to the company. He says this influence can be “transformative” in helping to build the company and raise money.
In general, I agree with Brad on this. What neither one mentioned is something that I think is critical: Board terms for at-large members at early stage companies should be one year and require unanimous approval of the other board members to renew. As Brad states, different stages require different types of board members. Typically, if the board term is not set, it is very awkward to try to remove someone who is not adding value.
I just published the second article for this series in my Forbes column: The Resource Allocation Dilemma Faced By CEOs Every…
Have less funding than your competitors? Good!
I often talk with young entrepreneurs who are struggling to raise money to keep their startup going. They are typically high achievers who have never failed at anything in their life. I often joke that running out of money isn’t failing: Failing is raising $100 million and turning it into $0. The funny part about capital is that having too much can be a problem just like not having enough, as Seth Levine says in this blog post. There is an optimum amount of capital for pursuing a given market opportunity. If the market is still developing, then additional capital is often wasted – or even worse: It causes the company to lose focus and pursue many different markets. The CEO’s job is to provide the right amount of capital at the right time.
Lululemon CEO Christine Day Is Stepping Down There are many different ways a CEO can lose his or her job,…