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Speaker 1

00:00

Okay, Anu, welcome to the podcast.

Speaker 2

00:01

Thank you, Craig. Thank you for having me.

Speaker 1

00:03

So this 1 is about board management. Your recent post, How to Manage a Board, did really well, and I think people have some extra questions, and also if they haven't read the post yet, we can kind of break down some of the bigger ideas today. So let's start off with, why did you write this post in general?

Speaker 2

00:20

Yeah, so this is actually been 1 of the top 3 questions asked by pretty much every growth stage founder in the YC portfolio. And you know, This often comes up, especially when they are raising their Series A and right after the Series A, because it's the first time in the company's life that you are forming an official board with an outside director. By the outside director, the definition is either an independent board member or an investor who typically let the series A joins the board.

Speaker 2

00:56

And CEOs and founders tend to be very nervous about this board composition because, let's be honest, this is the first time you have a formal board that has the ability to decide the performance of senior management, including has the ability to fire the CEO, which often is why provokes anxiety. And so the number 1 question we get asked is, I now have a board, what should I do? How should I interact with this board member? And as my board expands, how should I run my board meetings?

Speaker 2

01:28

And it comes out of this anxiety. And so we thought collectively as the YC partnership that it would be helpful to share best practices of YC companies that do this really well so that the rest of the community can benefit.

Speaker 1

01:42

And so let's start with board composition. If you're a founder, say, let's say you have 1 co-founder, how would you think about creating a board? Priyanka Royathi,

Speaker 2

01:49

Ph.D.: Yeah, so that's a great question. So we've seen different approaches. There is no right or wrong approach.

Speaker 2

01:55

The most common approach is your board typically, before you raise a series A, tends to compose of both the founders, or if you have 3 co-founders, all 3. And sometimes seed investors take both seats. But that's not something we've seen as common, especially among the YC portfolio. The first time an outside director gets added is usually the series A round.

Speaker 2

02:15

So at the time of the series A, if you have 2 co-founders, it's typically both the co-founders and the series A investor who left the round who joins the board. As the company scales and continues to raise future rounds, you tend to add 3 to 5 outside board members over the course of the duration, so around 3 to 5 years. So typically the B or the C investor also gets a board seat. But as you start getting closer to going public, the board composition actually tends to change quite a bit.

Speaker 2

02:46

And when a company goes public, and you can see this because Dropbox, Zoom, Pinterest, there are recent examples of companies that have gone public, you need to have 7 to 9 board seats. And at that time, you tend to add 3 to 5 independent board members. Also because A, you're looking for industry input or you know, specific operational areas where you're looking for feedback and closer to IPO you need to form compensation committee, audit committees which require independent board members to participate. So the composition really changes as you go closer to IPO.

Speaker 2

03:22

But since the vast majority of companies are in the early to mid growth stage, what is really important for you to know is You may have a 3 to 5 people board of which you and your co-founders have a boat seat and typically 2 to 4 investors who join your board.

Speaker 1

03:40

And now it's not uncommon for folks to add someone they've worked with in the past. So at what point does that person get added?

Speaker 2

03:46

Yes. So this is a trend we're noticing that's changing, especially with more recent YC companies. We've seen that more recently, YC companies tend to add an independent board member in the series B, which is slightly earlier than what we used to see in the past. In the post, I articulated 3 examples, which was Atrium, where Justin Kahn added Michael Sebel to the board, who he knew since college days, but was also his co-founder at Justin.TV.

Speaker 2

04:18

Enrique and Pedro at Brex added Victor Lazard, who has built a very successful gaming company in Brazil and has known them since the age 16. And he joined the board since the series B. The third example is Fair. And all the co-founders of Fair added Brian Gracedonia, who leads Square Cash, who was also their former boss at Square.

Speaker 2

04:41

And Fair has a huge fintech element to it, given they do net 60-day financing for the retailers. And so they felt it was important to get Brian, and I believe Brian has been on the board since the series A. Even if you look at other examples, like Adam D'Angelo at Cora, he added Matt Kohler in the series A as part of the financing, but he really knew Matt Kohler from Facebook, so he knew him for a very long time before Matt was brought onto the board. So in all these examples, what we see is the desire from the CEOs for a deeply trusted board member who would be able to help both the founder and the company as they scale, and yet is 100% independent, and willing to give direct and honest feedback that would be helpful for the company.

Speaker 1

05:32

So we should break down why that might, like you obviously can understand why trust matters, but what are the actual actions of a board member for folks who don't know, and why is it extra important that they can give them honest feedback?

Speaker 2

05:45

Yeah, so I think if you look at what is the job of the board today or what is the founding team or the company look up to for a board for, it's really 3 things, right? It comes down to helping hire senior management and evaluate senior management and essentially the founders' performance. Second is corporate actions like approving options and comp and other plans.

Speaker 2

06:10

And third is giving a lot of input on strategic decisions. And so That's really the, if you break down what are the 3 big responsibilities of the board, that's what it comes down to. Now what happens in a startup? As you scale, you're still in the scaling phase and you're in the learning phase.

Speaker 2

06:28

So a lot of the decisions you make may not be right. And over time, hopefully you're more right than wrong, but definitely you're not going to be 100% of the time right. And you're moving at 300 to 500 miles per pace, as a result of which a lot of things are going to break. Not all your processes are going to be intact.

Speaker 2

06:48

The CEOs often feel anxious that they need to get everything right and need to present to the board such that there are no questions to be asked. That is just not possible. It's essentially impossible. It's true for any successful startup.

Speaker 2

07:03

Nobody had a line that went straight up and to the right. Everyone had some roadblocks at some point. And so that's where the CEO is really looking for a trusted partner with whom they can bring up anything and everything on their mind. Entrepreneurship is a lonely journey.

Speaker 2

07:20

And as you scale, the CEO especially becomes more lonely and often is not able to even bring up certain issues or bounce off ideas with their own team. They find themselves in a vulnerable position. And if you feel the same way with your board, then you have to work really hard to find people outside of those 2 avenues with whom you can bounce ideas off. And so to have a trusted board really helps you.

Speaker 2

07:46

Because if you feel comfortable bringing up to your board member all the things that are going wrong and get their input, not necessarily their help in making a decision, but their input on how to handle these things, or even maybe articulate your thought process and ask them for feedback. If you don't have that trust, then it's going to be really, really hard. And so that's why I think that is this deep desire for getting a trusted board member on board with whom you can discuss all your downs as well and not just your ups.

Speaker 1

08:19

Yeah, and I think that's, it's a good example of how these boards and also your investors are at the end of the day, not your boss. It's still you running the company. So How do you structure a board meeting to get the most value out of it?

Speaker 1

08:33

Because at the end of the day, you're still making the choices, you're still pushing the company forward. So what are you looking for in a really productive board meeting?

Speaker 2

08:40

Yeah, so I think at the CDZ stage, the board meeting really varies because it's still the co-founders plus just the series 8 board member. So we've seen all kinds of patterns. I think the most common is you do a board meeting every 6 weeks.

Speaker 2

08:53

It's still slightly informal, not too formal, because you just have 1 outside board member. And so You may give it more like a status update with 2 or 3 questions. I've also seen situations where some founders have told me, especially when they have deep trust, like Adam D'Angelo with Matt, or Peter Reinhart with Was at Accel, they would do weekly calls. It was more like a one-on-one check-in and a sort of a formal board meeting every 6 weeks.

Speaker 2

09:21

Where really the constitution of the board and the board meetings changes is as your board scales as well, which tends to happen from the series B. Because from the Series B, you're typically in the growth stage, and that means you have strong product market fit, and you're truly raising money for scale, and your execution is all about maximizing the opportunity that's in front of you. So at that stage, you really need to put some structure and discipline, both in scheduling your board meetings as well as in the way you run it. So first is the scheduling.

Speaker 2

09:53

It's important to set your board meetings way ahead of time, at least a year in advance. And I usually tell founders, Keep your board meetings in person. Usually board meetings are once a quarter. Definitely, if not all board members, should be present in person.

Speaker 2

10:09

And it's way more constructive that way. Second is you need to have a structured agenda for each of those board meetings to get the most out of it. So the number 1 rule of thumb is don't make it a status update. Really invest the time in defining and aligning on what your key performance indicators or key metrics are, and align with the board early on on what that is and use that for the first 30 minutes of the discussion.

Speaker 2

10:36

But if your board, if you have a structured set of metrics that you measure to understand the health of the business and your board is well trained to understand that, that should really be 1 third, if not less, of the meeting time. The bulk of the meeting time should be around 1 or 2 strategic topics that you want input on. And it could be on anything. But it has to be something that's actionable and tangible for the moment, or at least 2 months away.

Speaker 2

11:02

So for example, in Gusto's case, which we shared in the post, we had in our last board meeting 2 really meaty topics. 1 was the team had spent an enormous amount of time coming up with their three-year strategic plan on what Gusto should do, which involved their future product roadmap, and it involved key decisions around which products they would work on versus which they wouldn't. And then the second part of the discussion was related to that, the engineering team build-out that they need to do to help support the 3 year strategic plan and to identify what the gaps are. So the reason why they spent a lot of time at the board meeting level for feedback on those were twofold.

Speaker 2

11:43

On the product roadmap, it was more to really share their thought processes and for the board to push on their thought process. And it was from the lens of, hey, we've been in the weeds for the last 90 days and we feel we've tested every question, while hey, you board, you are seeing this for the first time. And so push us, ask us all the questions we haven't thought through.

Speaker 1

12:05

So related to that, just to pause really quickly, how much of this material are you giving the board beforehand? Because you're saying they're seeing it for the first time, but they're sort of not, right?

Speaker 2

12:14

So the CAPE, That's a great question. So most of the board deck goes, in both Gusto and Brexit's case, a week before. But the strategic topic, Gusto in this case, because they wanted a fresh pair of eyes, actually didn't send the product three-year strategic roadmap until the day before.

Speaker 2

12:32

So it was pretty fresh. And it was done deliberately. And they gave a heads up around that. They said, we are gonna spend 45 minutes of the board meeting on the three-year strategic plan.

Speaker 2

12:42

We have a view, but we want fresh pair of eyes to push our thinking, and so we're gonna send the materials only the night before. So if you can read it up in the morning, that would be great, but you can come prepared with questions or we will update you during the meeting.

Speaker 1

12:57

Now what about specific topics? Say you're talking about something related to the engineering team, the CEO might have like a good picture of it, but not the full, complete picture, so when it comes to bringing 1 of your team members into the meeting, how do you think about setting that up? Should they stay the whole time, go for a segment?

Speaker 1

13:14

What do you do?

Speaker 2

13:15

Yeah, so that, again, it varies. We've seen both scenarios where in 1 case, the CEO usually likes the exec team to be present for the entire meeting so that they're able to see the feedback that the board is giving on not just their topic, but in the entire topic. And it helps, right, because all the execs get a good sense for the entire performance of the company.

Speaker 2

13:36

It helps with more leadership alignment. And there is no such thing as after the board meeting where the CEO has to go and say, well, the board member later told me this versus told me that before during your session, versus they're just seeing the whole thing just as much as the CEO is seeing. The approach I tend to prefer, and this varies, it's not a hard and fast rule, but in most cases it works, is bring some portion of your exec team for some portion of the meeting. And the reason I suggest that versus having the exec team for the entire meeting is when you have the exec team for the entire meeting, it turns somehow it turns into a status update many more often than not.

Speaker 2

14:11

Even when you're presenting a strategic deep dive, the exec thinks, oh, I'm presenting to the board, and this is stressful, and I need to make sure we're doing a good job. So it's no longer a brainstorming session. It turns into more, I need to make sure I've answered all questions. And so I think it takes time and practice.

Speaker 2

14:30

And so to make sure that there is really good and meaty feedback, it's helpful that the execs come in for some portion. I also do think even if the execs are present for the entire portion of the board meeting, there has to be at least 30 minutes of the board meeting for closed session, which is with the CEO and maybe the co-founders. But more often than not, over time, it becomes just the CEO. And in that session, it's really important to focus on collecting frank feedback from the board on how the company is doing, and even collect feedback potentially on how the board meeting went, and on both the CEO's performance as well as the exec's performance.

Speaker 1

15:12

Okay, so the picture you're kind of painting now is of an ideal board scenario. What do you do when there's conflict? Investors don't agree with each other, outside members don't agree with you as a CEO, maybe you're the CEO on an island and everyone disagrees with you.

Speaker 1

15:28

How do you navigate that?

Speaker 2

15:30

Yeah, and by the way, in most board meetings, you'll be surprised, most people don't agree. And I often say that you should measure the performance of a high-performing board just the way you measure the performance of a high-performing exec team. You don't want an entire exec team saying yes to the CEO or the co-founder for everything.

Speaker 2

15:49

And therefore, you should not expect the board to say yes to everything. Because if you set the tone, that way you're not maximizing their collective experience and getting input. At the end of the day as a CEO, it is absolutely your decision. And you have the moral authority because you are closest to the business on what is right for the company.

Speaker 2

16:09

But it's important for you to hear the different viewpoints. And so conflicting viewpoints is a great thing. And I think setting the tone for the strategic topic up front, saying the next 2 sessions in this meeting are going to be these 2 topics and I welcome debate. I've seen the best CEOs stand up and say that and they encourage conflicting views.

Speaker 2

16:27

And so you can see often board members saying a view and another board member directly conflicting by pretty much saying, I heard you, but I disagree, and here's why. And that's great. And if you see, someone has to keep time check. As long as you've collected the inputs, you can always say, okay, we're not gonna get to a decision at this point, but I hear the conflicting viewpoints and we need to go back and do some work and come back.

Speaker 2

16:54

So let's take this discussion offline and move to the next topic. That's totally fine position to get to. And in fact, if you feel you have heard new conflicting views that you have not heard before, it is important for you to reflect on it, maybe take even a week or 2 to reflect on it, further refine your decision framework, which we shared in the post as well. And say why you're picking a decision.

Speaker 2

17:18

At the end of the day, the board, just like your exec team, is looking for your articulation as a CEO on your rationale for why you're going with a particular path. And to the extent you're clearly communicating why you decided to pick that path, they will be fine with disagreeing and committing behind it.

Speaker 1

17:37

And so what's the best practice around following up? So say you and I were debating on something, you're like, you know what, maybe I don't have all the data here. A week later, I email all the board members, like what's the best

Speaker 2

17:48

practice there? Yeah, so again it varies, but I'll give you a real example. So on 1 of our boards that I'm on, the CEO presented the plan for budget for the next 1 year.

Speaker 2

18:00

And usually you need the board approval for the budget. And the CEO presented 3 scenarios and the board was divided. The CEO wanted to go with scenario 2 and the majority of the board felt they should go with scenario 1 and accept 2 board members that felt they should go with scenario 3. So how do you handle a situation like that?

Speaker 2

18:19

There's no way you could get that result in the board meeting. So the CEO said, okay, I hear all your feedback, we're gonna take this offline. And they literally made the list of all the conflicting viewpoints and why different people were advocating different scenarios. And within a week, the CEO sent a note to the entire board saying, we are working on addressing each of these questions so that we can make the right decision for the company.

Speaker 2

18:43

And that will take 3 more weeks. At the end of 3 weeks, we will set up calls with each 1 of you in week 4 and in week 5 we will do a combined board call to what in a scenario. That plan was clearly articulated 1 week after the board meeting. And in the 3 weeks the CFO went and spent a lot of time collecting market data, external conditions, which were inputs they needed to really understand if scenario 1 or scenario 3 was right.

Speaker 2

19:11

And then they did one-on-one calls with each of the board members.

Speaker 1

19:13

Yeah, why isolate folks? Why did they choose to do one-on-one rather than the group call

Speaker 2

19:17

at first? Because in that particular case, there was too much opposition for 2 different scenarios from the different board members. And so it was important to make sure each board member felt they were heard, but also that the company truly understood their opposition.

Speaker 2

19:34

Because in a group setting, when you're trying to collect all the conflicting viewpoints, and if you have only 45 minutes, you may miss the depth of the question. But they still did a combined board call.

Speaker 1

19:44

At the end, yeah.

Speaker 2

19:44

At the end, And then the whole team voted on a scenario. And by the way, that clearly articulated, in that case, the CEO actually disagreed with 1 third of the board. But he clearly laid out the logic for why he went with a particular scenario.

Speaker 2

19:58

And the board went behind him. And in fact, it is a great way of even documenting your decision making. As a CEO, over time you can reflect on the quality of your own decision making to understand how well you've been able to predict in the midst of uncertainty on what the right path is for the company. Okay,

Speaker 1

20:20

so now, what if we're in a scenario where a board member is not helpfully disagreeing with folks? A board member is like, in your opinion as a CEO and maybe as a co-founder as well, actively harming the board or the company or maybe another board member. How do you go about getting that person off your board?

Speaker 2

20:38

Yeah, so I think first, it's again, exactly it's not unlike running a one-on-one with your execs and execs don't work hard. But it is harder to fire a board member, really hard. And that's why I say you should do a lot of upfront work on is this the person you really want on your board.

Speaker 2

20:55

But if you're stuck in that situation, step 1 is about giving constructive feedback to the person. I think the most important thing CEOs need to realize is your board member also wants your company to succeed. Their incentives are aligned. After all, they put money and they advocate it for an investment within the firm.

Speaker 2

21:16

So they want the company to succeed. So I think it's about taking them offline, maybe going out one-on-one for a dinner, and giving really constructive feedback. And don't make it personal, But I've often seen that CEOs struggle to give constructive feedback to the board member because they view the board member as a boss. But sometimes it's important to tell the board member, especially if you feel this, which is, hey, your way of communicating in the board meeting demotivates me and that's not helping me be effective as a CEO.

Speaker 2

21:51

And sometimes they need to hear it. And it's okay to say that. And so it's important that you take them out and have a one-on-one, be very constructive about the feedback, give examples, and if it's emotional, as the example I stated, be very honest about it, because they want the company to succeed, and you are probably, as a CEO, 1 of the most important key members to help set the company up for success. And so I think it's important to try that.

Speaker 2

22:20

And if that doesn't work and they're not willing to work, then try to work with your other board members. Try to calibrate whether it's just your perception or if it's reality by talking to other board members. And I've seen situations where other board members have stepped in by giving advice to the CEO, but also calling the other board member to say it's destructive. The third option, as I said, is if you've tried everything and you can just make it work, but if you're a company that's doing really well and is gonna be an important company in the portfolio for the VC firm, then you can go to someone else at the VC firm, someone senior, and ask them for a replacement because you've tried everything.

Speaker 2

23:01

So those are some of the 3 options. Having said that, there's another important point I want to make here, which is, as CEOs, your company is your baby. But sometimes there is something called reality distortion. You believe too much in the potential of the baby without really looking at all the blind spots.

Speaker 2

23:22

And if the entire board is echoing the same feedback, maybe you should pause and think, why is that the case? And honestly, in 1 or 2 situations, I've seen this where if the board, if the founder really has doubts, then they bring in a exec coach to 1 or 2 board meetings, and they ask the exec coach to observe the board dynamics, And even do, the exec coach has even done a 360 feedback of the CEO with the board members. And that's actually helped improve the situation tremendously.

Speaker 1

23:56

Great. All right, so we have a handful of questions submitted from LinkedIn this time. I think people, I don't know, liked to get into your DMs to give more intimate questions. So, Augustine Fairhawke asks, what does it take to be a great board member?

Speaker 2

24:14

Well, I can only share examples of great board members that I have seen. You know, Mickey Malka is 1 from Ribbit who is on the board of Brex. I have always seen him, you know, proactively ask questions and proactively refrain from stating his opinion.

Speaker 2

24:35

And I think he really does this well to make sure that the decision is the CEO's and not his. And he wants to empower the CEO. And this actually helps establish trust. He has enormous amount of experience looking at payments companies, and so when Enrique asks the board, what should my typical credit loss rate be, it's very easy for him to say what the number is.

Speaker 2

25:01

But instead, he would give examples from different companies in their portfolio and he would state the pros and cons of each but he would stop from giving an opinion. If any question comes up in the board meeting, sometimes he would even go as far as asking them, are you asking me for my opinion? Or are you asking, you know, or do you want us to test your decision process? And I think that's a very important nuance.

Speaker 2

25:28

Because No CEO or founder should ever think that it's the board's job to make a decision. It is not. It is absolutely the founder's job to make a decision. And it's the board's job to empower the CEO to make a decision.

Speaker 2

25:43

And so I think to the extent board members really understand that, which is we are here to help the team as much as we can, to really push their thinking, and to empower them with as many examples as we can that we see from across our portfolio or from the market, but that the decision is the CEO's and we need to respect that. That I think is what truly differentiates a board member. Having said that, it doesn't mean a board member should not state his opinion in certain situations. I do think it's really important to hold everyone to the highest ethical standards.

Speaker 2

26:18

And if you see as a board member, something is going wrong, be it in the way the company is approaching sensitive topics, or even culture, or diversity, or even regulatory framework, it is the job of a board member to state their opinion at that point.

Speaker 1

26:37

Cool. Related to that, Dave Bailey asks, to what extent should the board culture reflect the company culture?

Speaker 2

26:43

Yeah, I thought that was a really interesting question, and I haven't thought a lot about it. But if I look at the boards that I'm on, I do feel that the board culture tends to reflect the company's culture. So let me take the example of Brex.

Speaker 2

26:59

I often say Brex's culture, if you look at their first 100 to 200 employees, they have a large percentage of first generation immigrants. And it's not that surprising, because Enrique and Pedro are from Brazil. And they moved to the US pretty much to join Stanford and started Brex within a year. And if you look at the Brex's board, all of us are first generation immigrants.

Speaker 2

27:24

And now, is that necessarily culture? No, but I think if you as CEOs tend to gravitate towards certain board members. You tend to gravitate towards individuals you respect and probably individuals you would work with. And that's the same lens you're using in forming your team.

Speaker 2

27:40

And so you tend to reflect, the board tends to reflect how your company operates. And the board members individually probably share the same values as you do. Similar example I'd say at Convoy. I think I always say Convoy's culture stands at most for transparency and they really care about community.

Speaker 2

28:02

And if you look at the board members they have, I mean, they have Vicey on the board, and we obviously care a lot about community. Reid is the other board member from K of Greylock who built an awesome LinkedIn community. So you can see that as CEOs, you will tend to gravitate towards individuals who probably reflect your core values. And so I think if you form a really effective board and you pay attention to who you're bringing on to your board, it's more important to make sure that their philosophy in life and the culture and the values that they aspire to as individual aligns with you as founders.

Speaker 1

28:40

Yeah, I think that's important. It's a nuance, but it's an important 1. Okay, so Connor Abin asks, everyone wants board members that can bring value to their company based on their past experiences, but how do you differentiate someone who may have limited experience in your particular industry, but you feel could still add a ton of value to your company?

Speaker 1

29:01

The underlying question here is, someone hasn't worked in your industry, you think they're good, should you have them on your board?

Speaker 2

29:08

Yeah, great question. And I probably, my view is going to be very different from a lot of people in the Valley. I often tell founders that when you're looking for a board member, the board member is going to stay with the company for 10 plus years or longer.

Speaker 2

29:25

I mean, the medium time to IPO is now 11 years. And If it's going to take that long, and it's so hard to remove a board member, then there are only 3 things you should look for in a board member. 1, as I said in the post as well, trust. Do you really trust this board member, and can you see yourself working with this person and trusting them for 10 plus years.

Speaker 2

29:48

And that only comes with time. You can learn some from back channel or reference checks by asking other founders who they've worked with. Now the second element I say is, what are the things as a company you will need for 10 plus years that won't change? There are really only a few things.

Speaker 2

30:05

1 is you're going to fundraise often. And so can this board member really help you figure out and give input on when and how to fundraise, how to run the process, can work with other investors as you're raising large amounts of capital. You may do acquisitions down the line. So is this board member really good at helping you give strategic input, advice, and figuring out what it takes to run a process, or even when inbound interest comes?

Speaker 2

30:32

So that's what I call as doing the VC job really well. Second, second thing you really need as your company scales, no matter where, I mean, even if it's 10 years down the line is hiring, especially hiring senior execs. So can this board member help you hire great execs? And the way to test for that is do they have a strong network?

Speaker 2

30:53

Does the platform or the firm they are part of have a strong network? Are they able to get introductions for you to individuals that you would want to have in your exec team. So that's the only thing that scales. And the third thing is, the job of the board member is really to push your thinking on strategic decision making.

Speaker 2

31:13

So how good is their strategic decision making? So when you're spending a lot of time figuring out whether you can trust, you should really evaluate, is this person asking really the right questions that push my thinking that I haven't thought of, or is just extremely smart and can ask questions that help flush out which part the company needs to take. Those are the only 3 things that scale with the company. And so if you're looking to add a board member who's gonna be with you for 10 plus years, those are really the 3 things that matter.

Speaker 2

31:45

Everything else you can get in other forms. You can add an independent board member over time if you feel you need functional area experience. Like some companies are operations heavy and they look for board members, especially from Amazon, for operational input. You could add advisors.

Speaker 2

32:03

Brex has done this really, really well. They have a set of advisors for each function who advises their executives. So they have a list of advisors for marketing. They have a list of advisors for product, for engineering, for sales.

Speaker 2

32:16

And these are really scaled execs who coach their executives. So there are other ways to get industry experience, but the core function of the board, the 3 things that I articulated are the only things that matter, because those are the only 3 things that last over 10 years.

Speaker 1

32:32

Yeah, that's great advice. So 1 more question, Rena asks, could you address managing a board during the product market fit slash pivot times? How would you go about managing your board when the product's not really working yet?

Speaker 1

32:46

You might go about changing the whole thing, like how would you?

Speaker 2

32:49

Yeah, I think that this happens, right? It's rare after the series A, but it has happened. It's happened even with a few vice companies.

Speaker 2

33:00

And I think the important lens there is, it goes back to the trust. If you trust the board member and the board member wants you to succeed, it's about being honest with them and saying, look, I have really spent time And I think what I'm building here is niche, and it's not gonna be a big opportunity. But I have this other idea, which I think really has meat to it. And if you're supportive of it, we'd like to go down that path.

Speaker 2

33:30

What's the greatest example of that? Stewart with Slack. I mean, this is exactly what he did with Axel and Andreessen Horowitz. And Slack is a pivot from their original idea.

Speaker 2

33:42

But I think it's important for you to bring the board member in, to trust them, and you will be more often surprised than not. Board members love it when the founders themselves realize the opportunity is small and that they are willing to try something new to make it big. Often the board members worry that, I don't want to really tell them that their baby is ugly and that they could actually take a different path. And so you bringing that up, especially if you've identified the right board members and you