Board Seats & Governance
What happens after the check clears
Board Composition
Early-stage boards are typically small: 3 seats (2 founders, 1 investor) or 5 seats (2 founders, 2 investors, 1 independent). As companies raise more capital, boards grow and the balance of power shifts. By Series C, most boards have 5-7 members with investor representation matching or exceeding founder seats. The independent board member becomes the swing vote in many critical decisions.
What Boards Actually Do
Boards approve budgets, major hires (CEO, CFO, VP-level), fundraising, M&A, pivots, and other material decisions. Day-to-day operations are the CEO's domain. Good board members provide strategic advice, introductions, and governance without micromanaging. Board meetings typically happen quarterly and last 2-4 hours, with a pre-read deck sent in advance.
Information Rights
Investors with board seats or significant ownership typically negotiate information rights — quarterly financial updates, annual budgets, and notification of material events. These rights are formalized in the investor rights agreement. For founders, fulfilling these obligations takes real time — preparing board decks, monthly investor updates, and responding to ad-hoc requests.
Governance Best Practices
Maintain clear board minutes and resolutions. Get D&O (Directors & Officers) insurance. Separate the board meeting from the 'closed session' where the CEO steps out and board members discuss performance candidly. As a founder, your relationship with your board members is one of the most important professional relationships you'll have — invest in it.