Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Boards are dangerous to founder/CEOs

reactionwheel.net

Post reply on HN
Print view View original

71–80 of 339 posts

Re: Boards are dangerous to founder/CEOs

#71

Post by gp »

drno123 wrote: post #67
rsweeney21 wrote: post #48

I always thought stuff like this happened to OTHER founders, but would never happen to me. But my board fired me six months after closing our series A. The advice in this article is 100% spot on. I didn't know any of this. I was totally focused on building my company. But if you raise money you can't do that anymore. 50% of your time will always be occupied with working on your next round of funding or managing your…

Who was your investor? So other startups know who to avoid.

Don't want to dox, but you should be able to find it on crunchbase. I'm not surprised about the story given who's in that round.

Re: Boards are dangerous to founder/CEOs

#72

Post by hn_throwaway_99 »

adtac wrote: post #70
rsweeney21 wrote: post #48

I always thought stuff like this happened to OTHER founders, but would never happen to me. But my board fired me six months after closing our series A. The advice in this article is 100% spot on. I didn't know any of this. I was totally focused on building my company. But if you raise money you can't do that anymore. 50% of your time will always be occupied with working on your next round of funding or managing your…

>Then a year after I got fired the series A investor led the next round of funding and decided to value the company at $0, so I got diluted by 99.99% Was it made impossible for you to be an investor in that round? Could you have prevented 99.99% dilution that way?

So the existing stock the CEO had, made through his blood sweat and tears, was worth nothing, but you'd expect him to want to pay for the ability to buy more stock in the company he was just kicked out of?

Re: Boards are dangerous to founder/CEOs

#73

Post by buryat »

drno123 wrote: post #67
rsweeney21 wrote: post #48

I always thought stuff like this happened to OTHER founders, but would never happen to me. But my board fired me six months after closing our series A. The advice in this article is 100% spot on. I didn't know any of this. I was totally focused on building my company. But if you raise money you can't do that anymore. 50% of your time will always be occupied with working on your next round of funding or managing your…

Who was your investor? So other startups know who to avoid.

2017-10-04 Series A - Numetric $13M

Insight Partners — lead investor

Hack VC

EPIC Ventures

Draper Associates

Aaron Skonnard

https://www.crunchbase.com/funding_round/numetric-series-a--...

Re: Boards are dangerous to founder/CEOs

#74

Post by dredmorbius »

0des wrote: post #16

It may be gauche to express this opinion on HN of all places and I hope it doesn't come off as tonedeaf disrespect, but does anybody notice VC is falling out of favor unless absolutely necessary? I am noticing a lot of bootstrappers that are emerging with the ethos that VC isn't what it used to be for some markets, and often a poor choice of the right VC can be a detriment to a project's longevity, with some teams ch…

As with much other knowledge and fashion (clothing, software, management, ...), it's cyclical.

Old-timers will remember Jerry Kaplan's Start Up, about the failure/betrayal of Go Corporation. https://www.worldcat.org/title/startup-a-silicon-valley-adve...

Or Sandy Lerner and Len Bosack's betrayal having founded Cisco Systems.

https://www.npr.org/2021/05/07/994789248/cisco-systems-urban...

Re: Boards are dangerous to founder/CEOs

#75

Post by somerando7 »

rsweeney21 wrote: post #48

I always thought stuff like this happened to OTHER founders, but would never happen to me. But my board fired me six months after closing our series A. The advice in this article is 100% spot on. I didn't know any of this. I was totally focused on building my company. But if you raise money you can't do that anymore. 50% of your time will always be occupied with working on your next round of funding or managing your…

Question from someone uneducated on this topic: is it impossible to get VC levels of investment without giving away board seats?

Is a board even required for private companies?

Re: Boards are dangerous to founder/CEOs

#76

Post by buryat »

rsweeney21 wrote: post #48

I always thought stuff like this happened to OTHER founders, but would never happen to me. But my board fired me six months after closing our series A. The advice in this article is 100% spot on. I didn't know any of this. I was totally focused on building my company. But if you raise money you can't do that anymore. 50% of your time will always be occupied with working on your next round of funding or managing your…

what about your cofounder?

Re: Boards are dangerous to founder/CEOs

#77

Post by szundi »

dcow wrote: post #27
ChuckMcM wrote: post #10

This is something you should really understand if you're starting a company. The board isn't your "friend" while individual board members may be, as an entity it probably isn't. The understanding that individuals can be "good" and the composite can be "bad" is usually encountered by most people when some government is doing something "bad" but the people who live where that government is in power are known to be "goo…

This is also why it's very very important for early employees to have their own lawyer review employment agreements. The CEO may be your best buddy and may promise to never fuck your over, but at a certain point they will report to the board and no longer be in full control. You should be weary of promises that simply cannot be kept. Your only option is to make the employment agreement 100% explicit even if it costs…

As a CEO of a company, I think this is one of the most important thoughts here. I was the owner too, hired a lady as CEO, later I fired her. It was very tiresome for me to keep wtf kind of promises she made just to maintain the credibility of the company and not to alienate people. Of course it payed out and I loved all the people, but boy... it would have been much easier to just tell the people that these are new times and those promises were against the company or whatever - pretty sure lots of people would choose the easier and cheaper way in "hard times".

I told to directors in multinationals several times that we have to sign this because it is not evident for their eventual successors that it is in their best interest etc.

Trust, but always be careful and assertive.

Re: Boards are dangerous to founder/CEOs

#78

Post by adtac »

hn_throwaway_99 wrote: post #72
adtac wrote: post #70

Earlier quoted context omitted.

>Then a year after I got fired the series A investor led the next round of funding and decided to value the company at $0, so I got diluted by 99.99% Was it made impossible for you to be an investor in that round? Could you have prevented 99.99% dilution that way?

So the existing stock the CEO had, made through his blood sweat and tears, was worth nothing, but you'd expect him to want to pay for the ability to buy more stock in the company he was just kicked out of?

No, I'm just curious if it was possible technically. Obviously it's super unethical to do this to your CEO.

Re: Boards are dangerous to founder/CEOs

#79

Post by polishdude20 »

anthropodie wrote: post #26
ChuckMcM wrote: post #10

This is something you should really understand if you're starting a company. The board isn't your "friend" while individual board members may be, as an entity it probably isn't. The understanding that individuals can be "good" and the composite can be "bad" is usually encountered by most people when some government is doing something "bad" but the people who live where that government is in power are known to be "goo…

“A group experience takes place on a lower level of consciousness than the experience of an individual. This is due to the fact that, when many people gather together to share one common emotion, the total psyche emerging from the group is below the level of the individual psyche. If it is a very large group, the collective psyche will be more like the psyche of an animal, which is the reason why the ethical attitude…

I wonder if this is a consequence of the shared qualities a large group has. In a large group, there are lots of people with different ideas. The only thing that is the most similar between all of the people are their base animal instincts because we are human. Thus, the base instincts are accentuated in the group.

Re: Boards are dangerous to founder/CEOs

#80

Post by tptacek »

somerando7 wrote: post #75
rsweeney21 wrote: post #48

I always thought stuff like this happened to OTHER founders, but would never happen to me. But my board fired me six months after closing our series A. The advice in this article is 100% spot on. I didn't know any of this. I was totally focused on building my company. But if you raise money you can't do that anymore. 50% of your time will always be occupied with working on your next round of funding or managing your…

Question from someone uneducated on this topic: is it impossible to get VC levels of investment without giving away board seats? Is a board even required for private companies?

I'm not the most informed person on HN who can respond to this but as a general rule it's within the bounds of normality to raise single-digit millions in unpriced rounds ("seeds") that don't generally have board seats attached, but your first significant priced round (your "A" round) will essentially always give up board seats.

Formal boards are not required for private companies.

Post reply on HN