This podcast episode covers a wide range of topics related to the role of independent directors in private venture-backed companies, from the distinctions between public and private boards to the challenges of dealing with structured deals and managing conflicts of interest. The speakers discuss the importance of independent directors in providing oversight, monitoring, and an independent perspective to the board.
Takeaways
• Independent directors can play a valuable role in private companies by providing oversight and monitoring, bringing an independent perspective and expertise to the board, and resolving conflicts of interest.
• Independent directors must understand waterfall structures and consider the interests of all shareholders when making decisions.
• Special committees are important for cleansing transactions and avoiding conflicts of interest.
• Independent directors have a fiduciary duty to the common shareholders and must consider the impact of their decisions on these shareholders.
• Independent directors should engage in diligence about a company and its dynamics before joining the board.
• Independent directors should have a good understanding of governance issues, common sense, and financial literacy.
• Independent directors should speak up early and often when a company is facing financial difficulties.
• Independent directors should fulfill their fiduciary duties and protect shareholders' interests, especially during tough times and structured deals.
