Dear SaaStr: How Many Board Seats Do VCs Typically Get?

Let me try to simplify, generally speaking:

1. Generally, “proportionate” boards are usually seen as fair, and easy to agree to.

I.e., if the investors own 20%, and the founders 80%, then investors get 1 board seat, that’s it. Founders can have 2 (or more) now, etc. If the investors own 50%, then split the board 50:50 (often with an outside to break a tie).  Very few Silicon Valley-style VCs will push for a non-proportionate board.

So …

2. The best way to retain control, if that’s important to you, is simply not to sell too much.

I know this sounds cute, but it isn’t. If you sell 80% of the company in 5 rounds, you won’t control the board, usually.

And, where you can — choose investors you trust.

Corner cases aside, this is the best most of us can do.

A related post here:

10 Criteria To Use To Pick Your Lead VC. If You Have Options.

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