In this interview with Jeremy Glaser, who is a partner at the law firm Mintz Levin and also serves as Co-Chair of the firm’s Venture Capital & Emerging Companies Practice, we discuss the importance of team dynamics on a board of directors. You must engage board members to get the benefits.
Patrick: You identify the roles and responsibilities. You identify the core competencies. You identify where there are gaps. You build the team based on that. In addition, you want a team, not just a group of super smart individuals. You need to make sure that people work together and have a good dynamic.
Talk to me about that and what you’ve seen. Sometimes there are smart guys in the room, but the team dynamic isn’t good.
Jeremy: I have an example from my 30-plus years of doing this. There was a semiconductor company that had some really big name VCs on the board of directors. At every board meeting, I would walk out at the end and say, “Wow, all the board members are there trying to show each other how incredibly smart they are as opposed to providing advice or guidance to the company.”
It was awful. It was a wasted opportunity. The CEO and I would talk about this after the board meeting and scratch our heads. All they wanted to do was tell each other how smart they are, how successful they are and how much they know about the industry. But they weren’t being helpful to the company at all.
It’s a hugely important issue. When you’re bringing a person on, why do they want to be on the board of directors? What can they do to help you as the CEO and founder of the company to drive your business and get the benefit of their experience in a way that is not them bragging about how smart and successful they are? They should be focused on, “What are the issues that you’re facing? I’ve seen this before. How have I solved these issues before?” I think you need to spend a lot of time to figure that out. You want to make sure that’s why the person is in the game.
One of the other challenges with pulling a board together today when you have venture capital invested is that the venture capital industry has changed a lot in the 30 years that I’ve been doing this. The VCs have become more professionalized. They’re working with much larger funds. They’re sitting on a lot bigger boards.
It’s a lot harder to get their attention on a regular basis outside of the board meetings. I tell my CEO clients, “That’s your responsibility.” Part of your job is engaging with that VC. You picked that venture capitalist because the fund had domain expertise. They had great success in your industry. You picked this individual to be on your board based on the person they are. You need to make it your job to get access to that person, even outside of the board meetings. Make sure that you’re getting the benefit of that.
This is Patrick Henry, CEO of QuestFusion, with The Real Deal…What Matters.