How to Build a Board of Directors

How to build a Board of Directors

We have personally learnt these and many more business skills from one of the best business success coaches and most successful entrepreneurs of our time -Mr. Dan Pena Snr.

To grow your start up or company to the next level requires a Board of Directors. If you want to be serious about cultivating and nurturing your organization to make it more profitable and readily financeable a Board of Directors is an absolute must. I would like to discuss here why having a Board for your company or business is so essential.

Firstly to grow a company from zero to a huge profitable organisation cannot be done on your own. You need to be able to give portions of responsibility away to people who have the authority to make better business decisions than you i.e your Board of Directors.

This is easily done by establishing an official Board of Directors. Typically it would consist of a few key roles to start of with. It is important that you have a chairman first, You then need a CEO, Chief Executive Officer, it may be you as the entrepreneur but it may not. The other key positions you need are a Financial Controller of sorts and a COO Chief Operating Officer.

There are many other positions but these are the essential ones to get you to the next level of building your Board of Directors.

So how do you go about getting your Board? Well it's quite simple you just have to ask! But quite often that is the hardest part thing to do. I am going to give you an example of how I built my Board of Directors for my company. I am in the internet telecommunications industry where I have niche's within healthcare. My goal is to dominate healthcare telecommunications via the internet. I am looking to grow my initial company with a view buyout other companies in the future.

Since I have a background in healthcare sales and a degree in pharmaceutical chemistry this gives me a little credibility and a lot of initial links and contacts of whom I could approach. I needed a high authority Doctor, who would be my industry expert and authority figure.

I simply used my contact base through the many hospitals and surgeries and educational links I had with hospital teaching centres to get email addresses of Doctors that were well established, were coming toward the end of their career and would like the challenge of joining a Board in an area of their expertise.

It took me about 2 months of searching, phone calls and emails to hook the guy I wanted. He was perfect a well respected senior physician that had spoken internationally and written in several international publications.

I now needed to get a Financial Controller. You can hire interim financial controllers from various agencies, which are paid on an hourly rate. This can add instant credibility and structure to your team, but in the case of a start up and building a dream its is most likely that you will not have the funds to do it this way. I also highly recommend searching for your Board of Directors with a long term working relationship in mind where you both get along and both believe in the dream.

So for my Financial Controller or CFO role I went to all the big Accounting houses i.e. Price Water House Coopers, Deloitte etc. and simply asked their HR department for any retired partners. I then went to the library and got all the back dated financial times papers in the business section and looked for any names that were retiring or looking like they wanted work. I then rang up my old pharmaceutical companies HR department and asked for any retired Financial Controllers or cooperate accountants. I did this to a number of institutions I simply got the yellow pages out rang and emailed all large companies asking the same question.

This was on going for 3 months, I did this in parallel looking for my Chairman.

It took me three to four months to establish a 4 member Board of Directors, which can be frustrating and time consuming. You need the highest level of enthusiasm, drive and persistence as you will get 99 people saying no to that one person saying yes. Remember it's just a numbers game. When going out and getting your Board you want to be crystal clear with your objectives that will attract the right expertise and people that will want to work with you.

Be sure to sound enthusiastic, like your idea is going to change the world, be humble and be prepared to give away a lot of equity in your business. I gave away between 1-10-% of equity for my founding Board members. this is what's going to attract them. The reason I suggest you go for senior and retiring people is that, firstly they will l have a vast amount of experience and secondly they will be able to commit time to you as they are now winding down.

Do not be put off about this, all these types of highly successful people all want to give back, and nothing is better than massaging their huge ego's by asking them to be on your Board. Remember you are asking them because you value their experience and knowledge.

The Board of Directors will do many things, if you have chosen the right people, they will guide you so you don't make silly mistakes, they will give you a huge load of credibility when you look to get finance and they will give you a huge amount of contacts to grow your business the right way.

Searching for your Board of Directors is the key to growing your business expotentially. The right Board of Directors can attract the right investment, ensure success and be the key to your development.

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