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Friday, November 17, 2006
The Second Board Meeting
So, our second board meeting for ClickCaster was yesterday. We had everyone in attendance: Myself and two of my folks (Pete and Marsha) and our directors, Brad, Niel, Jerry by phone, and a guest (David, one of our investors) who's likely to join the board shortly.
We went over some of the mechanics (approving the minutes from the last meeting with some input on how they should be short and highlight via bullet points what was discussed, how to best report finances consistently, etc.) and then went over the current state of the business.
This was an excellent discussion. We went over our activities over the last month such as development, new product capabilities, growth, status of existing customers and contracts, and results of interviews with potential customers but we spent the bulk of our time talking about where the business should go.
We looked at competition and determined we were well positioned. We looked at and discussed other companies our board members were familiar with that had similar business models but were farther down the road in the market and we were able to draw excellent conclusions on what directions we should be taking with our product development, market focus and definition of what the business really was all about.
One thing that really stood out and isn't always obvious to a Web 2.0 type company is an obvious one: Are you a consumer business serving end users or do you sell the platforms and tools necessary to enable others who already have relationships with targeted customer bases? And who's, really, driving your development? The 'perceived' end users customers or the businesses who will actually buy your product and use it to reach their customers?
Are you building your feature set based on what your developers (and their friends) think are cool or on what paying customers are willing to pay for? I know, obvious right? Product management 101 stuff, but it's easy to let those 'cool' things take precedent over the less cool things you can actually sell. Often they overlap, but not always. It's something every resource constrained early stage company needs to watch carefully, and manage even more carefully.
This is a question that I think more and more of the current crop of internet startups will be facing. With the recent pull back from the market (and taking 'parts' out for other future businesses) that Odeo (a company similar to ours in some respects) recently announced, it's pretty clear that not all consumer focused businesses are standing on solid ground.
The first board meeting was great for setup of what's to come and this, the second board meeting, showed us how bringing the full intellectual, market knowledge and general experience of a group of seasoned investors and fellow entrepreneurs has immense value to a young startup.
Most of what was discussed are things we would very likely have gotten to without the boards help and direction, in about 3 months (if we were lucky) and more likely 6 months or more. And in our world, 6 months is, literally, a lifetime.
What's becoming obvious is that by having a highly engaged board that's looking hard at your business, meeting monthly and communicating alot in between meetings is that you have a focusing effect that's exceptionally difficult to get without a group like this helping you to clearly think through the issues.
Often it's simply easier to 'let that problem go' for another month or two with the belief that it'll work itself out. What we did was identify where the weaknesses are and come up with a clear plan on how to address them and shore up the problems, do it with some real discipline and focus, and get ahead of the market, just enough-not too much, to become a major player.
I suspect many boards are more like 'reporting' exercises where the companies execs run through status and what they're planning. There's alot of nodding, a few questions and everyone goes out for lunch.
Not so with our board. We did have lunch (during the board meeting) but what we came out with was a much better view of things like: what our real business is, where we sit in the market, who we need to focus our sales and marketing efforts on and how to get there, much more quickly, than we could have done without the direct input and hands on involvement of a fully engaged board of directors.
We have work to do, and some of it will be difficult and less than fun, but most of it's exciting stuff that moves us to where we need to be. Fast, and with multiple big brains guiding the ship. I'm loving it, and find myself already looking forward to the next board meeting.
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Thank you for such a thoughtful post, Scott. There are some valuable insights into what it's like to have a board of directors here - as well as how to make important decisions as a young company.
Scott, great post. We share a similar point in time and one board member. Your thoughts are very articulate and transparent. I feel the same way. Its a much different experience then my last company. I look forward to my next board meeting rather then dread it.. Keep up the good posting.
a couple of "tells" that you are inexperienced-
-talking about details at board meeting
-you talk with your board as you would a mentor.
Things are done on the nod for a reason, it is because the CEO has worked out the basics of the business and the business now is to get it to market and raise more money, to get nervious about the next board meeting and prep. the presentation for the week prior to the board meeting.
your biz can go down in flames if you are too worried about the next months presentation. This is what press releases are for. just give them a heads up on the major issues.
Anon: Now, a couple of years after writing that post, I sort of, but don't completely, agree. The monthly meetings where a requirement of our lead investor and chairman. He's also a VC that went through the Dot Bust and felt the pain acutely so, he was doing his best to mentor the company along. I wouldn't agree to it again, having done it and learned from it, but I think for a first time startup guy and CEO, it was a valuable learning experience. I suspect it's a good idea for the first year if the CEO is new to startups.
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