So it’s the season where there are … some tough board meetings. Plans are missed, which is tough enough. Worse, cash sometimes gets tight. Look, this stuff is stressful.
So don’t make it even harder on yourself. 🙂 First, whatever you do, don’t stop sending regular investor emails — at the same pace. Don’t stop sending them on the 1st of the month just because the news isn’t great. Don’t hide from Bad News. In fact, run to it. And investors are wired to get some bad news. They get much more worried when the updates stop coming. Then they fear that maybe, the founders are hiding from bad news, rather than running toward it.
- Ok, so first, keep sending prompt investor updates. Acknowledge the miss, share what’s working, and just summarize the plan. Most folks will be cool with that.
- Then, expect a tougher board meeting than you’d like. Just expect it. It won’t all be back-slapping, Zoom waves, and high-fives. Even if that’s all board meetings were for 2021 and into early 2022. All High Fives.
- Third, have your team’s back. The best of them will know how to handle tougher times. But if they say things that don’t make sense, or try to obscure bad news — help them. Help everyone see the context. “Yes, it was a tough quarter on sales, but Linda and Jill hit 120% of quota. They showed us it can still be done.” An example. Sometimes, your team will struggle here.
- Fourth, remodel and reforecast religiously. Don’t let this go. Reforecast your Zero Cash Date, and importantly, present a Last Four Month Rolling Plan. I.e., a plan that projects future growth based on growth and burn for the last 4 months. Even if you don’t like what it says.
- Fifth, have the really tough conversations in a closed session. Do include your team in 90% of all the tough news. But not 100%. Save that for a closed session with just your lead investors, after the team has presented.
- Finally, talk to that one board member that pushes you the most — beforehand. Before the board meeting, or any other group meeting. Hopefully, they push you in a good way, to do even better. Oftentimes, this is the investor that actually cares about you the most. But you know the one. The one that challenges you and pushes you on area that are weak. You need the feedback. You want that feedback. But don’t force them to provide all of it in front of everyone. Talk to them, not after the board meeting but critically before it. At least that one. At least before the Tough Board Meetings.
VCs and investors aren’t always the kindest in providing feedback, and in fact, they can be a bit grouchy sometimes. Many were never CEOs themselves or never managed teams. Others, like myself, perhaps aren’t as patient in delivering feedback and squishy as they used to be. And at a more practical level, VCs and board members can feel pushed to provide feedback ASAP, given that they aren’t there every day. This can often force them to be more blunt and direct than others might be.
So just manage a Tough Board Meeting differently. We’ve all been there. They come, and with the best startups, later they go.
A related post here:
And if you aren’t having board meetings at all, here are a few good reasons to have them: