250 Board Meetings Later: This CEO’s playbook will change your board meetings forever
Matt Blumberg reveals why he bans slides, forces independent directors to "audition" for a seat, and uses AI to simulate Steve Jobs in the boardroom.
For many founders, the board meeting is a quarterly source of dread full of status updates and glazed eyes. But Matt shows us how to flip the script in your board meetings.
In this episode, the CEO of Markup AI and author of Startup Boards breaks down how to turn your board meetings into your ultimate strategy session. Matt shares the story of a "perfect" board candidate who failed a live audition, the "Rule of Ones" that will lead to an effective board composition, and why he strictly forbids slides during meetings.
He also reveals a wild new experiment: using AI agents to simulate a "Fantasy Board" meeting with personalities like Steve Jobs and Warren Buffett to stress-test decisions before the real directors show up.
Executives will come away with a playbook to stop reporting and start using their board to build the business.
Chapters
00:00 — The No Slides Rule
02:04 — Turning the eye roll into strategy
03:20 — The Audition: Making directors do the work
06:58 — How to reference check your VCs
08:59 — The "Rule of Ones" for board composition
13:25 — Stop writing 50-page board decks
17:24 — Specific rules for better conversations
20:58 — Inside the Markup AI pivot
23:05 — The "Fantasy Board": Simulating Steve Jobs with AI
26:19 — How to fire a board member
28:17 — Why every CEO should sit on another board
Follow Matt on LinkedIn: https://www.linkedin.com/in/mattblumberg/
Shoutouts
Startup Boards: https://www.amazon.com/Startup-Boards-Building-Effective-Directors/dp/111985928X
Markup AI: https://markup.ai
Fred Wilson: https://avc.xyz
Mike Collins: https://www.linkedin.com/in/mike-collins-362100/
Follow Keith Cowing on LinkedIn: https://linkedin.com/in/keithcowing Join the Executives Unplugged inner circle: https://kc.coach
Subscribe to the show
YouTube — https://www.youtube.com/@execsunplugged
Spotify — https://open.spotify.com/show/1Bw7KhjlUzFjMoFhdfNAKN
Apple Podcasts — https://podcasts.apple.com/us/podcast/executives-unplugged/id1769131263
Full Transcript
Matt Blumberg (00:00) What is the purpose of your board meeting? It's not transmitting information. You should have already done that in the board book. The purpose of the board meeting is having rigorous discussion and debate. And when people's eyes are on the slides, they're not having high-quality conversation. They have high-quality conversation when they look at each other and have a conversation. And it's really hard to do that when there's slides up. So I don't put slides up, I make people look at each other and have conversations with each other.
Keith Cowing (00:38) This is Executives Unplugged. I'm Keith Cowing, your host and executive coach. And today we're talking about board meetings. Those things that take a lot of prep, a lot of time, maybe 50-plus slides, and unfortunately, management teams usually waste in terms of the opportunity. My guest today is Matt Blumberg. He is the CEO of Markup AI and the author of Startup Boards. He has been in hundreds of board meetings as a CEO and as an independent board member.
And today he's walking us through tactical changes that you can make so you can build the right board, manage your board meeting well, and ultimately turn your board into a competitive advantage instead of a source of dread. Let's dive in.
Keith Cowing (01:20) Matt, welcome to Executives Unplugged.
Matt Blumberg (01:21) Hey Keith, good to see you.
Keith Cowing (01:23) Awesome, thank you for joining. Just to start out right off the gate, we're talking about boards today. How many board meetings have you been in in your career?
Matt Blumberg (01:31) I'm gonna guess 250 to 300, something like that. Probably 100 to 120 of my own companies. And then I've sat on a bunch of outside boards as well. So somewhere in that zone. And that's a mix of public, private, nonprofit, civic community, but more than anything else, private company boards.
Keith Cowing (01:44) So you've seen a lot. And starting with the ones that you've led, from your first couple board meetings to the last couple board meetings, what was the biggest difference in how you prepared, how you led your psychology, that meeting itself?
Matt Blumberg (02:04) Um, let's go with everything. Um, I would say the big, if I had to sort of characterize the biggest transition—and this is one that I always try to encourage other CEOs to kind of reframe in their head—my view of my board has gone from an eye roll, like, "Oh, got a board meeting," to I look forward to them because it's a strategy session with some of my best advisors.
Keith Cowing (02:36) Wow, if you can make that shift on anything in life, it just changes your whole enjoyment of the process and you get so much more value out of that. It's a real flow state. So with that as a premise, it's a great setup for the episode where you've spent time learning what it takes to find the right board members, to lead the right meetings, evolve the board over time. I've got your book here, Startup Boards. I found some amazing information in it because it's so straightforward.
Keith Cowing (03:02) I find that CEOs that are doing this for the first time or CXOs that haven't been exposed to it before, they have a lot to learn and it's not intuitive. And maybe we start with forming the board. You had a really interesting comment in here where you recommended that for independent directors, you actually invite them to a board meeting and have it as a tryout, if you will. Take me into that. How does that work? And I'm a huge fan of just letting people do the job as a test for whether or not they're good at the job. I'd never thought of it with boards before. How does this work?
Matt Blumberg (03:20) Mm, yes, in addition. Yeah, it's a really interesting part of the process that I came to appreciate for two reasons. I want to say this is something like 15 years ago. I didn't always do this. But a couple of things happened together. One is as my company at the time, which was called Return Path, got bigger and bigger, we started insisting on auditions for anyone at the end of their interview process for a job. So if they were an engineer, they had to come in and write code. If they were interviewing for a sales job, they had to come in and pitch us.
If it was an executive job, they had to come in and do some kind of strategy presentation. And I thought, you know, why not... why not do that for someone that you're going to put on the board as an independent director as well? And the first time I... and then I think the second thing that happened in parallel is I had an independent board member that was rolling off after four years where I realized after about two meetings of that person that like, I had gotten everything I was going to get out of them. And now I was kind of stuck with them for four years.
And I was replacing that person with a new board member. And I thought, "Hey, you know, if we do this for execs, let's do it for directors." So I had this great candidate. He checked every box that I had. You know, he was an experienced post-exit CEO in my space, had scaled a business, had sold a business to one of the big tech companies. I was looking for that sort of experience set on the board. I had a lot of large personality VCs on my board. And I really wanted someone who wasn't afraid of them. Like who wasn't afraid to speak up or go toe-to-toe with them if they needed to.
So I did this audition. I gave... and I told him that I said, "Hey, look, you know, we want to put you on the board, but you gotta do the... you gotta come to a meeting as a participant first. If it goes well, that was your first meeting. But it's a last opportunity for you to say you're not comfortable or for us to say it's not a good fit." And I took the time to go through all the materials with him before the meeting in good detail. So he was up to speed and he knew the acronyms and he knew the issues and the hot buttons.
And I even said to him, I said, "You know, here are three things I would really want your perspective on in this meeting." And he knew that what I was looking for was someone who could go toe-to-toe with the VCs. And we went through the whole board meeting and he almost did not open his mouth the whole time.
And despite all of his experience... and I even asked him pointedly a couple of times, "Hey, so and so, do you think of this?" And I get like a two-word answer. And so at the end of the meeting, he left, we were doing executive session. The board was unanimous. We're like, "Well, we don't need that on the board. That's not helpful." And then I went to go talk to him and I said, "Well, how was that experience for you?" And he said, "Boy, that was really uncomfortable. You guys are really like in it with each other. And I just, I'm not comfortable with that kind of conflict. You know, I'm much more behind the scenes kind of guy."
And I was like, "That's great. It was really nice to spend time with you. But it's not a good fit for the board." So long way of saying that has become standard part of my process since then. I have never bounced anyone else out of the process since then, but I feel like it's good discipline.
Keith Cowing (06:28) I've found that to be really helpful in hiring executives where if you can have them do the work a little bit—and sometimes you can and sometimes you can't—but it's such a better proxy. 30 days in you know if it's going to work, but the interview is a terrible proxy and going one step past is so valuable. And when it comes to VCs, let's say an entrepreneur is raising their first round of serious venture capital, putting together an official board for the first time. You talk about interviewing this potential board member, most people see it as money.
Matt Blumberg (06:32) Do the work. Yeah, that's right.
Keith Cowing (06:56) But you also have to think about it as your future board member. And you can iterate on most things, this you can't iterate on. You can't just fix it if you get it wrong. So how do you interview a VC?
Matt Blumberg (06:58) Absolutely. I love that you're even asking that question because most CEOs don't think like that. They think like, "What's the best term, what's the highest valuation?" And sometimes you can get them to say like, "I don't necessarily want the highest valuation. I want a high enough valuation, but a high quality firm." But you are hiring a board member and you have to think about the process that way. And I'll tell you a story.
One of my all-time great and sort of longest running board members and friends and investors is Fred Wilson from Union Square Ventures. And when I first took money from Fred at Flatiron Partners, it was 2000. So this was before Union Square Ventures. This is a million years ago now. And Fred was one of the only VCs I've ever heard do this. He came to me proactively when we were in diligence with them and negotiations with them. And he handed me a list of every CEO whose board he had ever sat on.
And he said, with their phone numbers and their email addresses, and he said, "You should do your homework on me. Call anyone on this list." And then he actually circled a handful of names and he said, "These are the ones that I didn't get along with. Like these are the ones that we ended up firing or there was some kind of problem." And he said, "Call anyone." So I wish more VCs did that. And I wish more entrepreneurs asked for that, but that's what you have to do because you're going to have to live with this person as your... as your board member, not just as an entry on your cap table.
Keith Cowing (08:24) If your VC is not as amazing and proactive, they don't offer that, but you wanna do your own back channeling, how would you coach a CEO to go figure out what it's like to work with them on a board?
Matt Blumberg (08:34) Well, first of all, I'd ask them. And if they say no, that's a huge red flag. If they say, "Yes, let me give you two," and it's like they're two poster children, well, that's not really good either. But it's not hard to back channel a VC. Most of them on the VC's website, it'll list all the boards they're on, sometimes the boards they've been on. So it's not hard to find your way to that.
Keith Cowing (08:56) And then once you decide, okay, this is a good fate, you get some, an independent, you have this rule of ones. Can you walk through that?
Matt Blumberg (08:59) Yeah, the rule of ones is add independent directors starting on day one. And then... sorry, then only have one member of the management team, founding team on the board. And then for every one VC on the board, add one more independent on the board. So let me unpack the rules there. The first thing is independent directors on day one.
It's really easy for founders to say, "I don't need a board. I don't want a board." Everyone needs a boss. Everyone needs some accountability in life. Even if you control the company. One of my independent directors over the years owned his own company and had a board. And yeah, they couldn't fire him. He owned the company, but he felt accountable to somebody for something. He had to show up at a board meeting prepared. So I just think that's really good discipline. And...
You know, the thing with a board is if you approach a board the right way, it is your inner circle, like your kitchen cabinet of strategic advisors. And it's a really valuable thing for anyone. You, all you do as a founder, you know your business better than anyone, but that's all you do. Maybe you have one extracurricular board that you're on or a little bit, but you don't... you don't have the breadth of experience by definition. So outside board members from day one are super helpful.
My second thing is only one founder on the board. I mean, sure. The day you incorporate, fine. If you had to put a few names on a piece of paper. But again, if your board is your outside strategic sounding board, why would you put someone who is the same as you on the board? Like all they do every day is have their head in the company. You're sort of a waste of a slot. If you're worried about governance issues, change your governance, make it so the board has to approve A, B, and C, but shareholders have to approve D, E, and F.
But having another member of the management team on the board is useless. So that's a conversation you have to have early, early, early. Like, "Hey, I'm going to put you on the board today because there's no one else to put on the board, but I'm going to roll you off the board as soon as we add independents and VCs." And then the last piece is for every VC add an independent. I think that balance is critical. So you as the CEO are the linchpin. And then you want the same number of VCs and independents, one and one, two and two, three and three.
So that you really don't have too much VC around the table. Think about it this way, public companies are nothing but independent directors. And when all your board is is VCs, you're missing so much richness of expertise and strategy. Not saying VCs are bad board members, they can be great, they can also be terrible. But having that balance is important.
Keith Cowing (11:27) And in my experience, that's not typical. Usually you have a token independent or maybe two and you have...
Matt Blumberg (11:31) No, usually you don't have any independence. You know, we did some benchmarking at my last company, Bolster. One of the things we did is we helped companies build their boards. We did a bunch of benchmarking. It was something like 67% of the companies we surveyed had no independent directors, including a third of like Series C and D companies had no independent directors. So yeah, it's one if you're lucky. And if someone is really advanced, they'll have a couple, but it's not commonplace and it should be.
Keith Cowing (11:49) Crazy. Have you found the conversations with the VCs to be easy on that front to say, "Hey, I want to bring in one independent per investor" or is that a negotiation they're not used to?
Matt Blumberg (12:05) You just have to... so that's one of those things. Again, if the VC says, "No, that's a waste of time," that's a red flag. If they say, "Sure, take my buddy, Jim," that's also a red flag. You want independent board members that are acceptable to you and acceptable to your board, but they should really be independent. And, you know, most VCs look, there are a lot of VCs that will say, "Don't prioritize that. And then just leave the seat open for now."
And I think that's... I think that's a mistake. And, you know, if a CEO wants someone on their board, they should say, "No, no, I'm going to prioritize this and here's why." And again, if they're getting pushback from a VC, that's a red flag. And if the VC says it's a waste of time, say like, "I don't think my board is a waste of time. You know, my board is a strategic sounding board. Don't... aren't we missing the voice of the customer in this table? Aren't we missing a go-to-market expert? Aren't we missing a privacy expert?" You know, obviously depends on the fabric of the business you have.
But there's no way that one founder and a bunch of VCs make up every angle from which it's important to think about the plan for a business.
Keith Cowing (13:08) So let's say you get that right. You get good independence, you get good VCs, you back channel them, you test them. Now you've got your board. Take us to the preparation for a meeting. There's the meeting, but it starts before the meeting. So to have a successful meeting, how do you think about preparing for that? What does it look like for you today?
Matt Blumberg (13:25) Yeah, so I'd say there are a couple things that are really important in preparing for a meeting. The first thing is that boards will consume whatever you put in front of them. One of my longtime independent directors used to say that all the time. He's like, "You serve it up, we will read it, and it will become the agenda for the meeting." So what you put in the board book becomes really, really important.
And again, a lot of people sort of default to this and CEOs don't have a lot of training in this. Your N is one, right? You've been on one board, your own board. And CEOs can default to doing things like, "I'll just put all the slides in and then we'll go through the slides in the meeting." Or, "We're just going to focus like all this. Here's a dump of all the reporting from last quarter, all the financials, the KPIs, this, that, and the other thing."
The reason a lot of CEOs roll their eyes when they think about their boards is they jump through hoops to prepare for the board and all they're doing is preparing for the board. Then they get in the meeting and they don't get anything out of the meeting because the board has tunnel vision on like, on page 27, this wall of numbers, like "What's wrong with this number here?" Not helpful to you. Then for board members, it's also kind of unsatisfying. It's like, "Wow, I just read a whole wall of numbers and then I read a bunch of slides and then someone came to me and read the slides at me and like, what did I get out? What was the whole experience?" It wasn't valuable.
For me, there's sort of two really important things that I do to prepare for board meetings. One is I make preparation for the board meeting part of my normal cycle of operations. So I plan my executive off-sites right around the end of the quarter so I can do my QBR, I can pull all the information together that the executive team needs to know to run the business. While I'm with the executive team, I use the time to talk about the upcoming board meeting and what we wanna get out of the board. What are the strategic conversations we wanna have? Where do we need their input? So most of the prep for the board meeting has already happened because I needed it to run the business. And then you do like a little bit of versioning of that for the board.
And then the second thing is when I put together a board book, I do have all the reporting in it, but I make the reporting... I make the reporting actionable. So I don't just put up a wall of numbers. I put up a wall of numbers and I annotate it. I circle three things in red, call them off to the side. I want you to pay attention to this thing, this thing, and this thing, and here's why. And then when I have a topic where I want the board to engage strategically, I write a very short one-to-two-page prose memo about the topic. Sometimes there's a chart, sometimes there's not a chart, it depends what it is. And I always end it by saying, "Meeting objective. Here's what I wanna get out of the board during this meeting on this topic." Sometimes it's a brainstorm. Sometimes I need help making a decision. Sometimes I need to develop alternatives for a decision. Sometimes it can be something else.
But what you don't want is you don't want to have made a decision on something and then the board to come in and brainstorm it. Right. Or if you need brainstorming, you don't want people to, you know, sort of go off the reservation and go straight to solutions. So, again, under the heading of boards consume what you put in front of them, tee everything up the right way. And if your board book is 75% historical reporting and 25% forward-looking strategy, that's OK. But you want the meeting to be the reverse.
You want the meeting to be a little bit of time looking backwards and a lot of time looking forward.
Keith Cowing (16:51) Everybody hates status meetings, but then the CEOs do it by accident in the board meeting with their most valuable room they have.
Matt Blumberg (16:55) I mean, you're like wasting everybody's time. I always call it the dog and pony. Every executive gets to stand up and read the slides that they already put in the board book that have already been read telling everyone how great they are. Like, what does everyone get out of that?
Keith Cowing (17:09) What are the little behavioral differences you see in CEOs that you've worked with from as an independent when you've been an independent board member, that was your prep. What else do you see where the things that set up a really powerful conversation that's useful versus a status report?
Matt Blumberg (17:24) I think, well, I'll tell you two things that... that I like to do with board meetings, that are super quirky. And I do talk about these in Startup Boards. So it's not like a state secret, but there are two things I do with meetings that are really, really quirky that I think are the difference along with good preparation or the difference between a good board meeting and a crappy board meeting. The first one is, no slides.
I will say that again because most people default to slides in board meetings. No slides. I do not put slides up on the wall and if it's a Zoom meeting, I do not put slides up on the screen.
Keith Cowing (17:58) You... you never prepared slides? The board deck is not made of slides? Or you have slides that you share to them, but you don't show it in the room? Okay.
Matt Blumberg (18:02) Neither. Neither one. Now you can decide your board deck of slides, but what I'm talking about is in the meeting, no slides on the wall. If you have to show a visual for a minute, show a visual for a minute. But the board meeting where you're paging through something, especially if they've already read it, but even if they haven't read it, what does everyone look at when there are slides? They look at the slides.
What is the purpose of your board meeting? It's not transmitting information. You should have already done that in the board book. The purpose of the board meeting is having rigorous discussion and debate. And when people's eyes are on the slides, they're not having high-quality conversation. They have high-quality conversation when they look at each other and have a conversation. And it's really hard to do that when there's slides up. Just, everyone defaults to like, they sit back and their eyes glaze over and they look at slides. So I don't put slides up, I make people look at each other and have conversations with each other.
The second thing is equally quirky, but in the same vein, is in a physical meeting, if everyone's in the room together, I put all of the board members at one end of the table together. And so people are used to it with me, but the first time you see it, it's kind of weird, like someone will sit down and I'll move them. Like a member of the management team will sit down and I'll say, "No, no, I need you to sit over there." So I have all the board members on one end of the table, observers elsewhere, management elsewhere. They can be at the table, but not sitting together. And the reason I do that is there's a reason that they're board members versus observers or management. That's the board. And the same thing, if you're trying to get a high-quality conversation and someone on the board has to like lean forward or lean back and they can't see someone they're talking to because there are five people between them, it's not a high-quality conversation.
When the board is clumped at one end of the table, they get into it. They get into the topics. You can do the same thing on Zoom. On Zoom, there's a feature in the video settings called "hide participants not on video." So I err on the side of having a ton of people on my board meetings. I have my entire management team in the entire board meeting, even if they don't talk. It's good for them. Good for them to hear it. Good for them to be able to speak and have some exposure in the room. But when I do a Zoom meeting, they can have their camera on at the beginning and say hi and then they all turn their camera off unless they're part of a conversation. And then I tell board members flip the switch in video settings where you're participants not on video and the thing that's different is you don't have 17 squares where each person is this tiny little square. You have five. And then you have the CFOs joining the financial conversation, they turn the video on, and now there's six.
It's just much easier to have a high-quality conversation when you're not staring at the Brady Bunch.
Keith Cowing (20:38) These are incredibly powerful little tips where you're taking the agency to own the meeting, to facilitate the environment by which you can have a great conversation. I love that. I think all CEOs and even just board members in general should learn from that. Let's fast forward to today. Markup AI, you're working on something new. Tell us about that and tell us about how you plan to build your board for it.
Matt Blumberg (20:58) Yeah, Markup AI is a really exciting company. I joined it in January. This is the first time I haven't done a startup. I've got recruited into an existing company. And we are orchestrating a really significant pivot of NLP technology, which is sort of, it's what people used to call AI before large language models. And we've now made a pivot so that the platform is foundational model-based agentic AI with a similar value proposition to the company's historical business.
We serve only enterprises, historically very large enterprises. Now we've been able to move down because of the new platform is architected very differently into mid-size and smaller enterprises. And our product is what we call content guardian agents. So basically we help companies make sure that their content follows their brand guidelines, their policy compliance and regulatory guidelines, and has also checked for accuracy. Think of it as guardrails for enterprise AI. It's really interesting business right in the thick of things right now.
Keith Cowing (21:56) Sounds super exciting. Bringing in the board topic for that, how do you picture that board evolving over time and what is a great board going to look like for you?
Matt Blumberg (21:59) Right. Yeah, so it's an interesting board because part of the company's story is interesting. It's not a new company. It's been around for a long time. It's private equity owned and it's European. Part of what we're doing in the business transformation is actually transforming it to be an American tech company. So we have the board that I inherited, which is European investors and a European independent director, really, really high quality, but they're missing things about the US tech ecosystem.
So what we're doing is we've expanded the board. I added one independent director in the US when I started. We're about to add a second one. So this is a case where the board's gonna get a little larger because I value the people that have been around the table for a long time and they in fact own the company. But they agreed with me that it would be really helpful for the business to expand the board to add some new voices.
And so we've been, we have sort of a blended board at the moment, but we're about to add a second independent. We'll probably add a third next year as well.
Keith Cowing (22:59) How close are you to your rule of ones?
Matt Blumberg (23:03) We're pretty close. Yeah, yeah, yeah. It was sort of three investors, one independent. And now we are about to add, I've already added a second independent, I'm about to add a third independent. So we will be at the one-to-one ratio come January.
Keith Cowing (23:05) OK, that's impressive with an existing board. You're getting there. You run an AI company. Do you use AI at all with your board?
Matt Blumberg (23:26) I do. I have a really interesting use case. And first of all, I have to give credit to Mike Collins. Mike is the CEO of AV, Alumni Ventures. And I sit on his board. So this is something that he started doing with his board and turned me onto. And now I do it. I have my own version of it. So I have what I call a fantasy board. So think about a fantasy football team, a fantasy baseball team. My management team and I did a fantasy board draft.
And we put together our dream list of board members. If we could only have Steve Jobs on our board. If we could only have Warren Buffett on our board. We came up with a list, a long list, like 17 people. Some of them are business thought leaders, business authors. We have tech, notable tech CEOs. We have iconic CEOs. I have... what I call the "different voice" category. I have Coach K on the board and I think we have Oprah on the board. So the fantasy board, what we did is we went out and we had one of the deep research AIs build a really long board profile of each of these board members. So like 5,000 words, many, many page profile with a really specific prompt and format that they were designing.
So we're looking for people that have a lot of, you know, public information about them, particularly about their approach to business, their philosophy, the things they've said about boards or said in the certain service of being on a board. And loaded all those profiles into a container. I think a quad project or NotebookLM or something like that. We have our own AI architecture at our company. And then I have an extraordinarily long set of instructions for the agent as well. And that group of profiles behaves like a board.
Keith Cowing (25:04) Mm-hmm.
Matt Blumberg (25:19) So, I ask it questions like a board and part of the instruction set is to tell me the consensus answer and tell me notable outlying opinions. What would these people say about something? So you can imagine, imagine the use cases for it. I'll run a board book by them before I finish it and run it by my own board. And I'll say, "What do you think of this? What am I missing? What are the tough questions I'm going to get? What are they expecting based on the last board book?" So all this stuff is kind of in the AI container.
Keith Cowing (25:30) That's fascinating.
Matt Blumberg (25:46) Prior board books, strategy presentations, financial results, et cetera. And the more I use it, the more value I'm getting out of it as, again, sort of like a pre-sounding board. Now, you have to be careful. They're not real humans. They're missing contemporary business context. Jack Welch has been dead for quite some time now. And they don't do as good a job at reacting to results as opposed to the things you feed it.
Keith Cowing (26:00) Yeah.
Matt Blumberg (26:08) But you can get some really interesting insights about your business when you ask Jim Collins if you're following the Hedgehog Strategy. It's been a nice addition to my board routine.
Keith Cowing (26:19) Wow, I love that as a tactic. Talk to me a little bit about how your board evolves over time and how a CEO should think about that.
Matt Blumberg (26:24) Yeah, for sure. Yeah, I actually think board evolution is great. So is institutional knowledge. You don't want a new board every year, every two years. But board members can get stale. Or they can be, as you said, the wrong person for the moment in terms of the size and stage of the company. So I actually encourage CEOs to think about their boards the same way they think about their management teams. Like, "What do I need right now? And what am I going to need for the next two years? Am I getting it out of my board or not?"
One mistake I see early CEOs, early stage CEOs do a lot is that they'll put an independent on and give them a four-year term. You don't know what you're going to need in four years as an early-stage CEO. Give them a two-year term. Give them less equity and give them a two-year term. Yeah, but I think that the... you know, it's a mindset thing and it's about agency again. So if you think of your board as your team, how do you shape your team? Not how does your team shape you?
Keith Cowing (27:05) That's an easy move.
Matt Blumberg (27:19) Or how does your team shape itself? So I encourage CEOs very much to think about their independent directors. Are they still getting value out of them every year? Or is it time to... does the business need something else? It's time to add someone else. And same thing with VCs. Certainly there are some early stage VCs that want to get off boards after a while because they're on too many of them. But there's some that don't like getting off boards, especially if a company is doing really well.
And what you don't want as a CEO is to keep adding and adding and adding and adding, especially if you're following the rule of ones. Like you don't want a nine-person board for your $10 million startup. It's just too much, too much overhead. So, you know, I would encourage CEOs when they're taking that first money to make that part of the conversation and maybe even make it part of the documentation. Like, "Hey, I value you as a board member, but I want to cap the number of VCs on my board at two. And so are you going to be OK after the B round, Mr. Seed Investor, rolling off? You know, I'm happy to roll you into an observer seat or just keep you posted on things."
Keith Cowing (28:17) Would you recommend CEOs find other boards to serve on as an independent member?
Matt Blumberg (28:21) Always, always, always, always. I think every CEO should try to serve on at least one other board. I will say I have always been on at least one, sometimes more than one. And I leave every board meeting of other boards that I sit on with two pages of notes: the one about that company and the one that I'm taking notes for myself. So you get to watch someone else do the job and you learn from them too.
Keith Cowing (28:45) It's one the amazing thing about board meetings is they're so important, but they're also behind the scenes and by definition, because it tends to be confidential information, people don't talk about it as much. And so a lot of the little tactics you just don't see until you're in there. And that's why I appreciate it so much that you wrote the book and you have two other ones as well, Startup CEO and Startup CXO. So if people are serving on an executive team or on a board, there's actually some information out there that can help you tactically just do it really well. So I appreciate that you're putting this content out in the world.
Matt Blumberg (29:14) Yeah, it's all stuff I wish someone had given me when I started my journey as a CEO.
Keith Cowing (29:17) Yeah. Where can people find you?
Matt Blumberg (29:22) I'm about the easiest person in the world to find. Matt Blumberg, you can find me on LinkedIn. Matt at markup.ai is the current work address.
Keith Cowing (29:31) Awesome. Well, Matt, thank you so much for joining me on the show. And I know that CEOs and board members and executives can benefit so much from this kind of transparent information of how to build a board, how to lead a board, how to evolve it over time, how to sit on other ones, how to learn from it. And ultimately, it's about getting the highest leverage use out of some of the most important people that are a part of your company. So you can't afford to mess that up or not focus on it. Thank you, Matt.
Matt Blumberg (29:56) Thanks, Keith. Good to talk to you.
Keith Cowing (29:57) That was Matt Blumberg, the CEO of Markup AI. You can find his books, Startup Boards, Startup CEO, and Startup CXO on Amazon or wherever else you find books these days. What a wonderful guest. I hope that was helpful for you. If it was, please share it with a friend and give us a positive review on your favorite platform. Until next time, enjoy the ride.
