Summary: The Board of Directors is a group of people chosen by shareholders who meet as necessary to make high-level corporate decisions. The board of directors is different from the officers of the company who manage the day-to-day business. Concessions to board policy and the production of people whose opinions you value are particularly sensitive. The percentages of equity will decrease with the maturity of the startup. For startups, the strategy of the board of directors is essential and many do not place foreigners on the board until they receive Series A funding. Beforehand, they select reliable advisors with all seed investors for the board of directors. When they receive Series A funding, they can call on one or two professional venture capitalists (VCs) with a reliable consultant as an external member. It is important that you include in the definition of these skills the skills your business needs to achieve its short- and long-term goals. Another thing to consider when selecting board members is the addition of influential people who may have contacts in the areas you need to succeed in your startup.

Know-how is important when it comes to starting and growing a business. Diversity is essential in a company, but it only works if it is relevant to the management of the company. The concept of relevance is quite simple. If you sell office furniture and accessories, you will want to look for board members who have worked in the office supplies and furniture industry. If your business sells health products, you will need someone with experience in the health sector in distributing and reimbursement of expenses. Board members and board observers address two main issues: your company`s code of ethics generally addresses issues such as honesty, integrity, acceptance of tips or material benefits, compliance with OFAC and other laws, as well as prohibitions against illegal discrimination, sexual harassment and misconduct that apply not only to company staff. , but also to the administrators. When a company takes money and earns venture capital, its investors ask for board seats to keep an eye on their investments.

But startups need to be careful, as some board members can put the interests of investors or founders ahead of the well-being of the company. While board members are important resources that provide professional support, insight and networks, not all members are created in the same way. Some members of your board of directors may be directors for the first time and may therefore not be familiar with the duties and duties associated with this position. Take the time to inform them in writing of the role of directors in the company, the responsibility they have as directors and to whom these duties are payable, the safeguards and benefits they have as directors, and all mandatory corporate guidelines relating to their duties as directors.