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 key role that the CEO must play on the board of directors to improve decision making and show leadership. The leadership responsibility of the CEO is to the management team, the employees, the board of directors, and other key stakeholders.
Jeremy: That’s a fair point. You’re the CEO. You ultimately have to make the right decision, and the board is there to give you input. You can walk into a board meeting and say, “Here is information. Here are the challenges that we’re facing. Here are the options. I’d like to get your view of these options.” That’s a perfectly appropriate way to approach a board. I wish more CEOs would do that.
Unfortunately, what I tend to see is one or two other options. One is that you walk in and say, “This is what we’re doing.” You don’t give them any of the information or let them feel a part of the process. Now you’ve put yourself in a position where you’d better be right. If it doesn’t work out, you’re going to quickly get yanked.
I’ve also seen a situation with a very weak CEO. They come in very open ended and say, “What do you think we should do?” That’s not going to work either. You’re the decision maker. You have to use your resources more intelligently.
I have a favorite quote that I’ve shared before. It was by the founder of a very successful software company. He said this about 20 years ago in a room of 400 people. To this day, I still love it and it sticks with me.
He said that, before he makes an investment into any business, he has one due diligence question he has to get answered. Does that founder want to be rich or does that founder want to be CEO? That answer determines whether or not he’s going to invest. If that founder wants to be rich, the founder will make a lot of the right decisions to make him money and have the company be successful.
But if the founder is focused only on being CEO, that founder will be focused on all the control issues. They will make all the wrong decisions and the business will not be successful.
I love that question. I think it’s an important question to ask for any investor. I think every CEO needs to look themselves in the mirror and say, “Why am I doing this? Am I doing this because I like having the title of CEO? Am I doing this because I want to build a big company and make everyone rich, including myself?”
This is Patrick Henry, CEO of QuestFusion, with The Real Deal…What Matters.