

A Philosophical View Of What Boards Should And Should Not Do - ohadfrankfurt
http://techcrunch.com/2013/02/26/venture-assistance-a-philosophical-view-of-what-boards-should-and-should-not-do/

======
vannevar
The original purpose of a board of directors was to manage the company at a
strategic level. To do the job properly takes time and effort. Unfortunately,
there is no limit to how many boards on which one can sit, and the quality of
corporate governance at the board level has degraded accordingly. Allowing
people to sit on multiple boards also breeds group think, conflicts of
interest and back-channels for insider information. Interlocking boards are
another way our economic system is gamed to favor the wealthy. We should
restrict membership to a single board, leading to a greater diversity of
qualified people in the boardroom.

~~~
wtvanhest
I don't disagree with your assertion, but how do you deal with the fact that
there is a finite number of qualified people who can sit on boards?

Its not like there are 10,000 past CEOs willing to sit on the boards of these
companies.

I think it is a really tough challenge, and one that is not easily solved.

~~~
vannevar
I believe there are many more people with sufficient qualifications than there
are board seats for them to sit on. They don't all need to be past CEOs, just
ethical people with business experience and good sense. And frankly, it
wouldn't hurt to trim the size of the average board, if it really becomes a
problem.

~~~
ECMathews
Definitely agree with this. One of the key innovations to free up more capital
in the fly over cities has been de-coupling the board membership from the
capital at the Angel or Seed level. We found that early stage investors would
put up the money but didn't have the time.

------
stephengillie
This isn't about Boards of Directors so much as about how VCs should act when
they act as advisers. And the article doesn't make the VC sound like an
adviser as much as a business partner. The problem here is the adviser isn't a
founding member of the company, even though the VC wants to be one. And when
you want to go a different direction, your adviser can all too easily become a
back-seat driver.

A VC is a person with time and money but no ideas. If they had ideas, why
wouldn't they make those ideas into real products?

~~~
orangethirty
But the VC has an idea. Which is use the money to make more money by allowing
others to build businesses. That's a business model itself. It requires the
same amount of planning, marketing, PR, etc. They also have to turn a profit
or face a bigger doom of losing lots of money on a bunch of bad businesses.

