Should You Start-Up a Board of Directors?
Author: Jasmine Waters
When life becomes hectic and stressful, it’s easy to prioritise things that don’t need to be immediately achieved. When small and independents start out, often that priority can be a race to growth, rather than product, strategy or profitability. One possible option to keep on the straight and narrow is for businesses to assemble a board of directors. Something we’d typically associate with a TV drama or untouchable household names, it’s now a strategy start-ups are turning to for increased support and security. What are the real benefits of boards for smaller brands?
Why include a board?
For a start, a board of directors can be crucial as a new venture gains pace, offering insight and outside perspectives on the important elements of a brand’s strategy. Now smaller companies are able to raise big money, boards have become dominant players. Beyond this, they are able to advise on auditing, company governance and those big decisions that need a second pair of eyes. Choosing these investors and members is the first critical step, making sure they are whole-heartedly matched to the brand. Make all the right steps with the wrong board member and it’s all for nothing. Select those from specialist areas your knowledge doesn’t extend to instead of seeking external validation.
Who else can be of help?
Independent directors are also a possibility to include into a board, with many having experience in knowing how to sell a company. Though they are typically paid through a yearly salary, they could be a lifeline in knowing when a business should be floated on the public market or offer sage advice if a brand is ready to sell. Alongside this, directors are perhaps the most advantageous in scaling. One area that could pay to have external advice through the course of the pandemic is knowing how to handle physical retail in an environment that has become largely digital. External members may have faced these kinds of roadblocks before, though some founders may not feel comfortable appointing anyone. In short, it’s important to remember that a strong board doesn’t necessarily guarantee brand success but does show that founders are open to constructive criticism and feedback – something consumers will increasingly appreciate as the years go by.
Those that do get appointed are best to act as a bridge between founders and investors, especially when perspectives don’t see eye-to-eye. For the new decade, making sure this board is representative of race, gender and other marginalised communities is a must – helping the brand understand the needs of the modern consumer more, as well as being a part of change starting ‘at the top’. The relationship between employees, suppliers and consumers can be strengthened because of this, even though the terms for joining a board can often be more flexible with smaller brands. If you want to make the jump but not sure if someone is the right fit, approach them to be an ‘observer’, buying you both time to see if the working relationship feels right. If not, a mis-match might not be forever, as your brand will look completely different a few years down the line.
Image source: https://www.boardeffect.com/