Go Big or Go Home

The Perfect Board Packet

Too often I receive voluminous board packets from over zealous CEO that are 50+, 100+, sometimes 200+  pages.  While CEOs intend for such a deliverable to be a sign of comprehensive hard work, it actually makes our life as board members difficult.  The ideal board packet is a simple PowerPoint Deck that highlights accomplishments, issues, and goals to be completed by next session.  The major theme of a board deck is marking accomplishments versus promises from the last board meeting.   Annual board meetings should be much more comprehensive, but your typical board meeting should include the following:

A good executive summary sets the mood for the meeting.
1.  Take care of  governance issues like options, approvals etc. first.
2.  Summarize cash position.  Highlight cash on hand, anticipated burn and cash out date.
3.  Summarize progress of the business.  Have a two column slide on that outlines what you said you would do and what you accomplished.
4.  Summarize any major issues/observations encountered during the quarter

Then methodically go through with a few slides for each functional area of your business, technology, product development, partner development, marketing, sales, customer service and financials.  No more than 2 slides per area highlighting agreed upon goals for the period and what you've accomplished.

5.  In the technology and product sections, highlight your product development gantt chart highlighting actual versus planned deliverables.  Be able to speak to missed dates with rationale and how it will be corrected
6.  In partner development,  summarize the meat of the deal.  Are there pre-commitments or is it just a Barney deal?  What will it cost to support the deal and what do we expect to get out of it?
7.  In marketing, summarize PR placements and lead generation activity.  How well are you converting leads into qualified sales opportunities?
8.  In your sales section, walk through the pipeline deal by deal in salesforce.com format highlighting the deals you closed this quarter and expect to close next quarter, the quarter after that, etc and make sure those numbers tie to the quarterly financials you present.  Your board should become very  comfortable for your ability to predict timing of closings of your deals.
9.  In the financials sections, highlight cash flow.  It is really all that matters.  Bookings are great, but cash flow timing is start-ups is crucial to understand.  Even the most promising business are out of business when they our out of cash.  Investors hate bridge loan fire drills.
9.  Strategic topic.  If appropriate, pull one topic out of the weeds for a strategic discussion like product vision, next target markets etc.  Have a slide or two to spur discussion.
10.  Finish with a summary slides highlight key goals before the next board meeting.

VC's: What they say and what they mean

 

The defined terms below were passed on to my by a collegue of mine.  More hints for entrepreneurs in translating VC speak into plain english.

Conservative Financial Model
Represents twice or more the perfected upside scenario the Company can achieve in the event that two dozen disparate factors converge at exactly the time of the third lunar eclipse of the third millennium. Approximates the odds that the Brewers will win the World Series any year that the Dixie Chicks are their starting pitching rotation.

Customer
Any company, person, or animal that has had any communication—written, verbal or telepathic—with the entrepreneur, such as unsolicited mail from Publisher's Clearinghouse, American Express, and Safeway.

Differentiated Product
A product that has so many discrete technical, business, and geographic qualifiers that the market is precious—unique and small. No two employees can be building, marketing, or selling the same thing.

Due Diligence
Research used by venture capitalists to uncover information they want to know about a company they do not want to invest in, and to avoid uncovering information they don't want to know about a company they do want to invest in.

Execution Play
A bet that a startup can grow into a self-sustaining business before the money runs out. (See also Technology Play.)

Liquidation Preference
The droit du seigneur of venture capitalists, executed upon the groom rather than the bride following a union by merger or acquisition.

Participating Rights
Similar to Liquidation Preference (see above) and executed at the same time.

Restart
The hope that the Red Sox's prospect for success at winning the pennant can be improved if the team switches to playing football.

Stealth Mode
The gift of privacy bestowed upon coy early-stage technology firms by reporters and analysts who pay them no attention.

Strong Team
Guarantees that everyone managing the business graduated from high school with better than a C average.

Technology Play
A bet that a group of engineers made wealthy by a previous startup success can find venture capitalists who will mistake a product for a business and provide follow-on funding before the money runs out. (See also Execution Play.)