I made one mistake which created a ripple effect. My co-founder left in the middle of 2013; we knew each other for 13 years. We had a good relationship— out of the 13 years, I would say that the first 12 years were absolutely phenomenal. During our last year together, he probably started wondering whether I had enough clue in running this company, which was a fair thing to doubt because we had spent eight-nine years, and we were still going through ups and downs. Understandably, he started losing confidence in me. We were having differences of opinion—which was stupid if I have to think about it retrospectively, stupid and immature on both our parts, but mostly on my part. I take that blame more than the other person, but I never thought that it would eventually lead him to leave the company. We had just raised a million dollars from an Angel Network a year ago. I didn’t keep my board updated about our co-founder disagreements because I felt that this is something I can overcome. Not bringing this to my board’s attention was one big mistake I made.
One fine morning I was sitting in the US, and my cofounder was in Chennai. He sent a “last day” email to a group of people he works with and just left the company. That was totally a shocker, and I was scrambling how to react; I called the board and explained what had happened. The board lost confidence in me since this was a breach of trust. Our investors tried to take over by getting another board seat. I had to fight back and somehow rebuild that confidence that I will build the company back. Luckily, we diluted only 9 per
BE VERY CLEAR AND STRATEGIC ABOUT WHO YOU BRING ON THE BOARD.
– GIRISH MATHRUBOOTHAM
cent of the company at that time, so I still had a lot of control. We worked hard and after six months, the company started growing. It was a very interesting and humbling experience to realize that even after my co-founder left, the original 15 people stayed back as they still trusted me. After a year, the same board came back and told me that it was like a phoenix rising from the ashes. That’s how this whole episode ended. Previously, I had always felt a bit complacent that I had a co-founder. We had this unwritten understanding that I was responsible for sales and marketing, while he was responsible for product and technology. Due to this compartmentalized approach, I had never viewed this whole thing—technology, product, marketing, and sales—as one fully connected system. In hindsight, my co-founder leaving allowed me to have an integrated view, which I truly believe is responsible for the success of Kissflow today. Although there will be a team of co-founders in any startup, the captain of the ship needs to have an integrated view of this whole perspective about a product, sales, marketing, customer success (very important in SaaS), and how it all interconnects and that was the deeper insight I got from this episode.
Be very clear and strategic about who you bring on the board. Do they understand your business? Can they help you run the business? Be very selective about getting your investors on the board—don’t put them on the board just because they put money because they will be sitting there and offering very unhelpful advice. You should also know when to bring an independent board member. Most early-stage startups anyway don’t need outside board members; it is a waste of time.
WHEN ADDING A BOARD MEMBER, THEY SHOULD WRITE UP A JOB REC FOR THE BOARD MEMBER, WHAT ARE THEY LOOKING FOR, WHAT ARE THE SKILLS THEY WANT, WHAT ARE THE YEARS OF EXPERIENCE THAT THEY WANT AND HOW DO THEY GENERALLY THINK ABOUT WHAT THEY ARE LOOKING FOR IN THAT PERSON.
– ELAD GIL
One thing that people don’t do enough is, just like they write a job recommendation for basically everything else in their company, when adding a board member, they should write up a job rec for the board member, what are they looking for, what are the skills they want, what are the years of experience that they want and how do they generally think about what they are looking for in that person. So, then they have a common view with the other people who are interviewing, and they can have a very targeted discussion around whether this person actually meets the set of things that they are looking for. And there are a few things in particular that I would look for beyond the skill set side. The personal rapport and the interpersonal style matter a lot and also what are the motivations for the person taking the board seat.
The thing you want to avoid, for example, is the independent board member who wants to join your board because they want to network with the important people who are on your board. Or, you don’t want the person’s stature in their own eyes to be driven by whether they take the board seat or not, because then they may be functioning in weird ways relative to your esteemed board members. You don’t want somebody who is going to talk down to you or be patronizing. Sometimes you see that with the “experienced” board member who will talk down to you as a new founder or who would try and steer you in directions they think the company should go. So, there are a few almost like red-flag warning signs when you interview board members around things you should be aware of.
Board members add value when they are very involved in the business. If people are willing to spend like half a day/month or a day/month, going deep into it, because advice is useful only when you have context. Otherwise, it is useless. Obviously, we have been fairly lucky to have great board members. Very early in the business, we said we need an operating board beyond just investors on the board. Because some of our angels came from enterprise sales–heavy backgrounds, we realized that they added a lot of value. Going deep into the business, knowing exactly what is happening, it is also the founder’s responsibility to keep people involved. If you end up making relationships where the guy just comes for a board meeting, it is never going to be useful.
The founder’s role in building relationships and trust with the board through open dialogue is extremely important. Having monthly meetings and regular updates helps build that rapport. Giving early warning signals helps build trust. Board members are like sounding boards for the founder in the early days. They help bring clarity around the key decisions. Therefore, having someone with experience of building a company before helps. As many times a decision could go either way in the early days, interpersonal relationships with the board members are key in my experience. However, as the company scales, the founder has many professionals on the team who help him/her think through scale issues. Board members’ role then changes more into governance helping the management team think through blind spots or bringing attention to changing market trends.