Thursday, June 19, 2008
Board Planning Exercise—Finding Your Company’s Competency
At the recent Angel Capital Association Summit in San Diego, I had the opportunity to hear Dave Berkus of the Tech Coast Angels talk about the work of the Board of Directors in a startup. Aside from governance most startups need help in setting strategy. Dave Berkus outlined an exercise he uses with startups to help them find their core competency.
It goes something like this-- make a chart with the following column headings:
What they want
What you want
Now go through and for each candidate company that may one day want to purchase the startup, list out what they would want from your startup. Likewise, write down what the startup would want from the candidate company. After you list out five or ten of these, go back through and rank them based on the value a proposed buyout would bring.
This exercise brings into focus what the startups’ core competency is and helps the entrepreneur set a strategy to develop that competency. As a secondary benefit the exercise highlights who may want to buyout the startup and why. Along the way the startup can start building a relationship with the candidate company.
In the early days of a startup strategy is equally important as governance. The planning strategy outlined above can help set the agenda for the board in working with the startup.