Building a Startup is challenging. You'll need to find your product-market fit, scale through various stages, raise money, build and rebuild management teams, raise more money, refine strategy, consider complex tradeoffs, negotiate potentially conflicting shareholder perspectives, and handle both inbound and outbound M&A opportunities. The one thing to expect is that you are guaranteed to face numerous tricky issues and moments of uncertainty.  

I think an excellent Board Chair is essential for the success of a startup.

Over the years, I have collaborated with several highly effective Board Chairs, and below are some of the qualities they share.

1. Leadership and facilitation skills

• A Chair excels at clarifying priorities, prioritizing what needs to be discussed, leading meetings, and guiding sometimes tricky discussions. They can consider the diverse perspectives of board members, manage different personalities, and keep meetings focused on strategic topics. They sometimes need to steer the conversation but can do so without stifling input. This is particularly challenging, as board meetings often address complex topics among people with varied interests and expertise.

2. Strong relationship building

• Building and sustaining strong ties with the CEO, board members, and key stakeholders is vital. A great Chair promotes a culture of collaboration and open dialogue, even when tensions run high. I believe the best Chairs are independent voices at the table and effectively represent the key constituents.

3. Strategic vision and execution-oriented mindset

• The best Chairs relentlessly maintain a strategic perspective, ensuring the board and management align with the company's long-term objectives. They work hard to understand the market, the company's strategic approach, and the overall industry environment. They also help foster a quantitative discipline driven by clear KPIs that distill what is essential and are aligned with the company’s mission. They also net out what is and what isn’t crucial, as both boards and management teams can get distracted by shiny objects to red flashing lights. This is not a drop-in, drop-out role. There must be an evident passion for the work; this is not a job you show up at for four quarterly board meetings a year.

4. Empathy

• Empathy is crucial for grasping the typical difficulties the CEO and management team encounter during a startup’s lifecycle. A supportive Chair fosters an atmosphere where the CEO feels comfortable discussing concerns and seeking guidance. Sometimes, the Chair will need to coach the CEO through difficult tradeoffs or challenging situations, and this is only effective when there is a clear trust relationship.

5. Ability to foster diverse perspectives

   • An excellent Chair prioritizes diversity of perspectives and experience, striving to foster an inclusive setting by carefully considering the board's makeup and including varied viewpoints. Companies thrive on a broader and less parochial lens.

6. Conflict resolution

• The best Chairs are skilled at resolving conflicts and keeping the board focused on the company's best interests. This includes being open to various viewpoints and encouraging productive dialogue. Especially when founders have stepped away from management but remain on the board, the most effective Chairs ensure that the founder’s legacy views are respected but tactfully questioned if they no longer align with the company's direction. This can be pretty challenging, as the qualities of a great founder ensure that they are powerful advocates for their point of view, even when that point of view may no longer be relevant to current market conditions.

7. Patience and reflection

• A practical Chair combines a passion for the company's mission with patience and thoughtful decision-making driven by a focus on long-term benefits. Since change is constant in startups, great chairs are skilled at adapting and keeping the board open-minded.

8. High integrity and low ego.

• I have found that the best Chairs I have worked with exhibit the utmost personal integrity, dependability, and dedication. Additionally, they can maintain a modest ego since founders, leaders, and other board members often possess strong personalities.

All in all, it’s a critical role and executed well, can profoundly impact a company’s success.

I often get asked when a founder should or should not be the Chair of the Board. I think the answer is “it depends,” but I am generally not a fan of a founder being the Chair for a few reasons. One, they may not have the experience to perform this role effectively, and two, they often are passionate advocates for a particular point of view. In my experience, because of the careful balancing act a Chair needs to strike amongst all stakeholders, it is likely more effective to have an experienced independent Chair.

I’d love to hear your thoughts and experiences in this area.