Control - Founder vs. VC

What the greatest technology investors say about Control - Founder vs. VC

Fred Wilson: Board’s Role & Responsibilities

Fred Wilson venture capitalist and Co-Founder Union Square Ventures

“The Board of Directors is the [company’s governing body].  All major decisions [require Board ratification, including approval to sell, hire or fire a CEO, make major acquisitions and do major financings, including an IPO].”  All strategically significant issues need Board involvement and support.    

“[][The] Board should not run a company [][but ensure] the right team is at the helm []. [Boards] must always act in the best interests of the company and its major stakeholders:  [] employees,[] customers, []shareholders, [] debtholders, [etc.]   [] The company works for the market [] and the Board and the management team work for the company.” 

Often, as director a right answer isn’t straightforward.  “There are no formulas [][nor “right answer”].  Only time will tell if the right decision was made [which can be debatable].” 

A good board is engaged, debates openly and honestly and tries reaching consensus.  The Chairman should drive the Board.

CEOs shouldn’t manage the Board. “A great Board manages itself, [] treats the CEO as a peer, [and considers the CEO's opinion,][but isn’t] a rubber stamp.  [It] pushes the CEO and the company to make the most of [presented opportunities and asks necessary hard questions]. 

[] [Boards] should evolve [with members changing occasionally, and some but not too much churn is good.] [] Boards should always be looking for new blood.”  Fred Wilson, The Board Of Directors: Role and Responsibilities, Mar 5 2012;