The other morning I was reading about Brad Feld’s first board meeting where he asks the reader if they remember their first board meeting. I remember mine vividly.
It was in the late nineties, I was in my late twenties and I had just raised $11M for my first venture backed startup, LayerOne. The venture capital firm had two seats and I controlled three. They were located in New York so we held the meeting on the phone. The first topic of discussion were option grants we needed to make to a few advisers who had helped me along the way. I had promised the options and they were terribly material; however, the two VC board members objected STRONGLY to the grant.
Remember, this was my FIRST board meeting and I was an arrogant twenty-something who raised $11M for an idea and a prayer. The younger of the two VC board members attempted to coach me on the board call explaining that all of our votes should be unanimous and that we shouldn’t have contention – especially this early in our new relationship. I explained that I had ‘PROMISED’ the grants and that I couldn’t imagine not honoring my commitment. Ultimately we granted the options.
This was one of many mistakes I made as a first time CEO. In retrospect I should have tabled the matter and talked to each director privately, explaining the situation and asking for their support. I just assumed since I had three votes on the board I could do whatever I wanted – I was dead wrong. You need the support of your board and getting them comfortable is vital to the success of your company.