A VC in Vacationland

Most of us have now heard about "helicopter parents"–they rush into their children’s lives at school, sports or whatever and attempt to manage their activities.  Not the best learning experience for the child and a real pain in the neck for professionals who have to put up with the parents and their requests.

I’d like to speak today about my least favorite board member–the helicopter board member.  The helicopter board member has similar tendencies to the helicopter parent.  They rush into the board meeting, often late and without having spent any time reading the board book or speaking to the executive team, turn to the financial pages and start nitpicking the CEO in front of the rest of the Board members and other executives. Now granted, some CEO’s do not do a good job of defending their finances, plans and operations.  But, hey folks, we are talking about start ups here.  It is very difficult to exactly predict revenues and expenses in small businesses when a delayed signing by one client or unanticipated costs can easily screw up a quarter.  Furthermore, valuable board time gets wasted on subjects that are often not that relevant to the overall success of the company.

Don’t get me wrong.  I am not condoning poor planning or excusing screw ups by the management team.  And I always look at planning and execution mistakes with the CEO to see how we can do it better next time.  My beef is with the method used by helicopter board members–public humiliation and wasting time arguing stuff that should have been addressed prior to the Board meeting–to make their points.

So what’s a CEO to do?  A CEO has only minimal control over who joins his or her board, given the need for investors, et. al. to have a place at the table.  And even if you pick one yourself, you really cannot tell up front whether a board member will behave in this manner. However, you can take steps to ensure that they are not given a load of ammunition to allow them to misbehave at the meeting.

1. Communicate in Advance–I know that pre board meeting communications by executives to board members is a highly charged topic in the start up guru community. So much so that I wrote a Prep the Board!? post on it last year.  But I still believe that CEO’s must clearly communicate with all board members prior to meetings, not to go over the entire agenda, but to make them aware of issues that may come up at the meeting and/or to explain how mistakes may have been made. This helps avoid overlong explanations at Board meeting for members who do not prepare up front for the session.
2. Put Financial/Business Updates at the End–I can hear the screams even in Maine.  Heresy, you say.  How can you even suggest that??  My feeling is that unless there is a financial crisis that needs to be dealt with immediately, then you should end not begins with business and financial updates.  Does this screw up the flow of the meeting, since current business conditions may affect decisions about spending, strategy, etc.?  Absolutely, but you can go over plans and strategies up front and leave any decisions until after business and financial updates are complete.  I am a firm believer that board meetings ought to help start ups look ahead to the next challenges and that more time should be spent looking ahead than at prior performance.  I’d rather hear about these before I make decisions around how we plan so spend our money next quarter.
3. Take the Long View–Finally, work hard to win over the helicopter board member to your side.  Frank discussions about their issues and hot buttons, as well as your efforts to deal with these in a timely manner is usually enough to satisfy them.  I have been on boards where this is never true, but that is a rarity.  Most board members want you to be successful.

But do beware of the helicopter board member who may want your job.  This is not as uncommon as you might think.  I have served on a number of boards where it was clear that the rabble rouser’s thought that they could do a better job than the CEO.  In one case, this was true.  But the rest of the board could not stand the "helicopter" behavior on his part and went outside for a new CEO, in spite of the fact that the person was well qualified for the job.