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Boards are dangerous to founder/CEOs

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Re: Boards are dangerous to founder/CEOs

#321

Post by cutemonster »

Kaizeras wrote: post #65

This brings memories. I also got „asked to leave“ after raising our first round. I was young (25) and naive, with no experience in business within the family. But what was really crucial back then was that I lacked a mentor who’d make me aware of the risks before letting the sharks in. It took me three years to bounce back and start something new. On the positive side, I learned a lot.

> It took me three years to bounce back

What happened with the first company? I wonder if you made any money from it in the end, if maybe they sold it and you hadn't been diluted to much

> I also got „asked to leave“

Could they force you, by having more votes? Or were they just very persuasive and convincing

Re: Boards are dangerous to founder/CEOs

#322

Post by cutemonster »

mst wrote: post #281

> The advice here is pretty basic: nothing happens in your board meeting. Your board meeting is scripted. The board members should have seen the information presented before the meeting (and not just because you sent the deck—half of them won’t read it beforehand—you must talk to them.) And you should know beforehand how each board member will react to the information presented. If there are decisions to be made, you…

Hmm it'd be interesting with a list of all meeting types, and their intended outcomes, and if scripted or not

Re: Boards are dangerous to founder/CEOs

#323

Post by cutemonster »

system16 wrote: post #103

Reading things like this and how common it is for investors to take over, I just wonder how it is possible that a young - and presumably naive - Mark Zuckerberg avoided the typical VC pitfalls and board guillotine / "CEO replaces themselves to help transition company to the next level" path? Was it just because Facebook's growth was so unprecedented they had no need to replace him? Or did he have a very good mentor o…

> and how common it is for investors to take over

How common is it? Like, NN%?

Re: Boards are dangerous to founder/CEOs

#324

Post by JanisL »

martinald wrote: post #318
JanisL wrote: post #280

Earlier quoted context omitted.

I think the reverse repo situation sheds some light on why this wasn't happening as much earlier: https://fred.stlouisfed.org/series/RRPONTSYD/ Put simply there's now a glut of money that is waiting to be invested via loans in anything that has a good ROI with low enough risks. In the past due to higher interest rates and various other factors (including regulatory) this glut of money just didn't exist before.

Well, go back a few decades and all businesses were pretty much debt financed. VC wasn't around - maybe a few friends and family rounds, but bank debt was the only option for growing a business (at least until you got to the public markets). This seems to have been lost over the past 20+ years. I wouldn't even think about going to a bank with a smallish business for financing, you'd instantly think of equity funding…

The last time I went to a bank I remember thinking the loan terms were pretty bad for the business I was involved in relative to equity approaches. Why do you think there's been a shift towards equity financing? I wasn't looking at anything in this space a few decades ago, is it because debt financing options are worse or equity better?

Re: Boards are dangerous to founder/CEOs

#325

Post by nazka »

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…

Maybe also because of that:

https://randle.substack.com/p/playing-different-games

Re: Boards are dangerous to founder/CEOs

#326

Post by cutemonster »

shard wrote: post #316
jyscao wrote: post #156

Earlier quoted context omitted.

>If nothing happens in a board meeting because it’s scripted, why do they exist? He actually answers that later on. >Of course, you have already told them all this on the phone, one by one, so you know how they will react. They will want to talk anyway, because part of the meeting is them performing for each other, but, again, no surprises. Except instead of only "part of the meeting", perhaps it might even be more f…

For anyone not aware, this method of discussing individually with stakeholders ahead of time before any decision or approval meetings is a common way to make the meetings go smoothly. Stakeholders won't be surprised by any items you bring up, you won't be surprised by anything they bring up and can address issues ahead of time, nobody will be embarrassed at the meeting (you really don't want to surprise a VP with som…

> discussing individually with stakeholders ahead of time

Do you email them and schedule an ahead-of-time personal meeting in your calendars, or do you just (more informally) call them?

Re: Boards are dangerous to founder/CEOs

#327

Post by coldtea »

Cpoll wrote: post #312
coldtea wrote: post #223

Earlier quoted context omitted.

Not all insights come as ready-for-consumption statistics and prepared-for-you facts wrapped in a nice red bow, nor they always come with numbers and figures attached. Often, the most interesting insights come from experience and reflecting upon it. You know, old fashioned thinking.

> Often, the most interesting insights come from experience and reflecting upon it. You know, old fashioned thinking. That _sounds_ nice, but the Ancient Greeks (and others, but I've got to pick on someone) tried it and didn't succeed in much more than setting back the scientific method and thinking up all sorts of plausible things like "everything is made of air" and "the first humans were born inside a fish." The p…

>That _sounds_ nice, but the Ancient Greeks (and others, but I've got to pick on someone) tried it and didn't succeed

... except at moving humanity forward regarding morality, understanding of society, politics, history, organization of civic life, philosophy, theater, poetry, arts, a few millenia forward, while spearheading democrachy, historiography and several other things besides, and establishing the whole basis for this "western civilization" thing...

>That _sounds_ nice, but the Ancient Greeks (and others, but I've got to pick on someone) tried it and didn't succeed in much more than setting back the scientific method and thinking up all sorts of plausible things like "everything is made of air" and "the first humans were born inside a fish." The problem is that something can sound completely plausible, be internally logical, and also be completely wrong.

I think an even more real problem is a lack of knowledge of history, and what exactly those pesky Greeks (and others before and after them) did, combined with a fanboy attitude towards the "scientific process" (as if it emerged wholesale somewhere around the 16th century or so).

Re: Boards are dangerous to founder/CEOs

#328

Post by mavelikara »

ido wrote: post #320
mavelikara wrote: post #306

Earlier quoted context omitted.

> you can't really tell for sure a company is going to become a massive unicorn often until very close to the point it does. I don't contest this point. > I've worked at companies that raised many millions of $s and seemed very promising and a few years later went out of business. The only narrative I contest with my anecdata is drawing a universal truth from this experience of yours. As a sibling comment said: > Sal…

I think it's the other way around - we comparatively hear a lot more about the successes than the failures. For every unicorn that made 400 people millionaires there are probably >1000 startups that either went out of business, never had a liquidation event, or never at the scale that rank and file employers got anything significant. Obviously not literally "nobody", someone at some point joins google/microsoft/faceb…

> I think it's the other way around - we comparatively hear a lot more about the successes than the failures

Not here on HN.

I was prompted to post on this thread after reading comment after comment about failures.

Re: Boards are dangerous to founder/CEOs

#329

Post by CRConrad »

djyaz1200 wrote: post #247
andrewseanryan wrote: post #232

Earlier quoted context omitted.

Pretty sure it was Sean Parker but I could be wrong

One of the Sean's :)

Or Shauns.

(Oh holy fucking mother of Baa[l], only now it struck me that the name of the animatronic series by the Wallace-and-Gromit guys is of course a play on Shorn the sheep!)

Re: Boards are dangerous to founder/CEOs

#330

Post by mleonhard »

anamax wrote: post #317
mleonhard wrote: post #311

Earlier quoted context omitted.

Could an employee union balance out the power of the board? They could attend board meetings and veto deals that harm the employees via strike or mass resignation.

Unions don't necessarily get board observer status, let alone board seats, AKA a board vote. Having a board vote isn't the same has having a veto over every possible decision.

You seem to be replying to a different comment.

> Having a board vote isn't the same has having a veto over every possible decision.

My comment did not imply that a board vote grants veto power. I suggested that the union could "veto deals ... via strike or mass resignation". This means that the union decides on a maximum dilution and agrees to strike or resign if the board makes a deal that dilutes employee positions more than the maximum.

> Unions don't necessarily get board observer status, let alone board seats, AKA a board vote.

My comment did not mention anything about board seats. The board would grant the union permission to attend board meetings, lest the board inadvertently trigger a strike or mass resignation.

Next time, please read the comment carefully before replying.

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