any of the benefits that come with having a board. These benefits include, but are not limited to, advice, counsel, relationships, experience, and accountability.
I will like to offer a 'conscious guide' to entrepreneurs that find themselves in the dilemma of appointing the right board of directors/trustees for their organization:
Never fill independent seats on your board with people who have no operating or start-up experience. I would recommend people who have been CEOs of successful businesses, ideally with industry experience, who are strong operators and have "seen it all" or as much as possible.
When you have weak members, strong members tend to dominate, sometimes leading to a single board member pushing the CEO in whatever direction they want. The worst thing you can do is say "I know a guy..." and then ask them to join. Instead you should create a profile for what a great board looks like, which means a different profile for each seat, and then recruit based on that profile. The person you know might be right, but you should give yourself a few options for comparison.
It is important for board members to have a diverse background with operating or start-up experience (especially in not-for-profit associations). One of the biggest challenges you'll find with people that have had great success in only one area is the "I too know" syndrome.
Lastly, a board can be helpful even if you don't feel you need it. But if you get some great minds with great networks around the table, they can be a great resource both for governance, strategic planning, and extending your reach through their networks.
I need to say this again: don't fill independent seats on your board with people who have no operating or start-up experience. You already likely have someone like that (yourself, an investor), so don't complicate your lack of operating experience.
January 6, 2013 at 9:45pm near Lagos
You don't need a board of directors to succeed in business, what you need is a GREAT TEAM! BOD is just a fancy title that creates more confusion, unnecessary 'red tape' & workplace politics ...... TEAM is more informal, better to manage and with it great results are achieved!!
January 6 at 10:12pm
I would presume that your business venture is subjective and does not require the blend/combination of expertise for success. Of course, small businesses might exclude the cost of operating a 'fancy titles', but as it grows into larger corporations with more challenges...
January 6 at 10:22pm
Any company can have a board of directors, but my point is that you don't need a BOD to succeed in business whether large or small corporation!!!!!
January 7 at 8:03am
@Ezinne, do you mean Large corporations don't need a BOD to succeed? First of all, large companies cannot succeed without the boards' resolution and a private company cannot transform into a public company. Secondly, the private company will not be capable of raising expansion capital, to possibly monetize the investments of early private investors, and to become publicly traded enterprises. Unless of course, you are not considering an exit strategy in the long-run, the advantages of having one outweighs the risks!
January 7 at 7:04pm
Yes, large or Small 2 medium size Enterprise don't need a board of directors to succeed ........... Instagram that was sold for $2 billion, did not have a 'board' ...... one of my mentors Ali brown has a multi-million dollar company run by over a team of ten staff - no board ...... the list is endless, yet these companies are very successful. When a company goes public by selling its shares, then having a board becomes mandatory due to stock exchange and corporate governance regulations. The board i.e in the UK requires 50% executive directors and 50% non-executive directors on the board to ensure an appropriate balance. The reason for making it compulsory for public companies to have a board is to ensure that shareholders wealth are effectively managed, and strategies are effectively scrutinized by non-executive directors to ensure the directors' risk appetite (or greed) do not endanger the growth prospect of the company!!! So like i said before, Having a board is good, however technology has changed the way companies are operated, so large or SME can succeed without a board!!!
January 7 at 9:28pm
Well, did you know that the decision to sell Instragray By Instagram CEO and cofounder Kevin Systrom) was assumed to be made by Instagram's BOD?? The Lawyer for California's Department of Corporations asked Systrom if Instagram's board of directors had received any other formal offers to buy Instagram before the Facebook talks.
Systrom's simply replied that "I am the board, and I have not received any." And the report concluded that it was also pretty sure Systrom meant he was a member of Instagram's board of directors, not the only one.
January 8 at 3:01am
you have just googled instagram, copied and pasted on this post one of the articles there without checking the authencity of what has been written ........ what does that say about other articles you've posted on this forum. ........ Well i rest my case here because i like to rub minds with people who post comment because they have thought about it and written from experience, no the one who just google articles, copy and paste without questioning the source of their info. .......
January 8 at 6:01am
As long as this in not an argument, of course I googled the 'endless list' of companies u claim that don't require BODs, copied evidences n pasted it so you that you can see that your reference point (i.e Instagram) still supports the importance of BOD. What do expect me to do when I wasn't sure about the authenticity of the the only reference you made? Its like already you personally don't like the BOD TOPIC and don't want other entrepreneurs to know d difference, case closed!
January 8 at 10:17am