Who should be on your board?
Your five-minute guide to the best of Protocol from the week that was, from how to choose board members to what carbon dioxide removal can actually solve.
Who should be on your board?
Choosing board members is hard. You want smart and imaginative people, ones that are going to challenge your thinking as a CEO. But you also need people who will actually turn up to the meetings and approve your budget and tell you that they think your strategy is ultimately OK, even if they shit all over it for a few hours while you sit around that big table in the stuffy corner office. And I guess it’d be nice if they all kind of … got on, at least a bit? Not in a doing-shots-at-Margaritaville way, more in that cordial-business-people-agree-to-disagree kind of way.
Maybe that’s all a little unambitious? But it works for a lot of companies.
I really do wonder how many CEOs have sat listlessly spinning around on their Herman Miller sipping a cold brew thinking, “What I really need here is not just someone smart, but a true maverick, who seems to enjoy getting in trouble with government agencies, who accuses people of being pedophiles, who is a deeply polarizing figure not just in tech but in the whole world. Yes, truly, that is the board member we need.”
Though that is what Parag Agrawal seems to have done this week.
I don’t think I need to fill you in on Elon’s ascension at Twitter? Buy stock, file late to the SEC, tweet product proposals, get elected to board! (A busy week for the Pied Piper of Tech Twitter, even by Elon’s standards, all while organizing a big factory party and taking a trip to the White House.) He made it all look pretty easy, which I guess it probably is when you have $3 billion on hand to buy stock. “It’s pretty hard to say no when the biggest shareholder asks for a board seat,” David Larcker, who runs corporate governance research at Stanford’s business school, told me. And while it was a little more complex than that, including a few weeks of conversations between Elon and Parag, Twitter’s CEO reportedly “welcomed” having Elon on the board, according to The New York Times.
There’s some stuff we don’t know about how this all came together, probably most important of which is how real the threat of a takeover by Elon was and how that went down at Twitter. (Though the standstill agreement that Elon signed with Twitter was less than 300 words long and pretty much only said he couldn’t own more than a 14.9% stake. By contrast, when Elliott Management’s Jesse Cohn joined Twitter’s board as an activist, the standstill agreement was close to 10,000 words. So clearly Twitter cared a lot about keeping Elon’s stake in check. And, uh, presumably it means Elon wanted it to be a quick read.) But if we take Parag at his word, he thinks that Elon will add “great value” to Twitter’s board.
I guess the big question — or at least, one of the big questions — is: Will he? Or is it going to be a huge fiery mess when Elon tries to impose wild new ideas, or tweets about Twitter's strategy from board meetings, or gets in a huge fight with board chair Bret Taylor? I chatted with Larcker a little about what happens when companies elect, shall we say, a provocative board member. “When you add somebody like this to the board, the whole boardroom dynamics, the whole social dynamic is going to be different,” Larcker said. “It could be good or it could be bad. So stay tuned for that!”
But ultimately most people elected to SIlicon Valley boards — Elon very much included — have incredible levels of corporate experience. And with that comes the kind of instincts that allow them to navigate those kinds of potentially tricky relationships. So there’s reason to be positive about how this plays out for Twitter. “On most good boards there's a spirit of being a team,” Larcker said. “If there's disagreements, they work that out. If you have someone with a different personality, the board has to adjust that. Boards work that out.”
(One indicator of potential success is that Elon seems to get along just fine with Robyn Denholm, the independent chair of Tesla’s board who the company had to install to replace Elon as part of the settlement with the SEC over the take-private tweet debacle. “Robyn is great,” Elon tweeted last August.)
As for what Elon’s presence means for Twitter’s product? He is surely an activist on the board, but not in the Elliott Management way of wanting only cold, hard returns; he wants the very ethos of Twitter to change. As Alex Kantrowitz smartly pointed out, Elon basically wants to take Twitter back to the good ol’ days of freewheeling, unmoderated fun — at a moment where a doubling down on moderation has actually made it more financially viable. And The New York Times reported that, “Unlike some other Twitter board members, Mr. Musk did not sign an agreement that forbade him from influencing the company’s policies.” So he has some latitude there.
It will now be the board’s responsibility to hold accountable not just Twitter’s management team, but also Elon. And really this gets at an important point about how to choose the right board members: You need different people to play different roles. “You don't want everyone having a singular focus; you want different points of view,” Larcker noted.
Maybe more CEOs should be thinking about making their boards more challenging after all.
A MESSAGE FROM CLARI
"To win more revenue for your sales teams, start with the customer. Understand what your customers need, and make sure that those needs are aligned to clearly defined internal success criteria. Build trust across the teams that what you sold the customer is what is being delivered." - Pilar Schenk, COO at Cisco Collaboration
You tell us
We asked you who you want on your board, and you responded! We got thoughtful responses about what qualities make a good board member.
“The ideal board member will be someone like Thomas Edison, James Watt or Nikola Tesla - a person from the era where disruption was something more than building a new mobile app. Someone who is not trying to fix a bad 20+ year old product but build a new one that challenges the industry and makes а change. Someone whose mindset doesn't allow them to accept 'can't be done' as an answer and who inspires their team to always move forward. And finally, for us, someone who holds transit close to their heart and believes in its potential to transform societies.” — Konstantin Spasov, Business Development Manager at Modeshift
The best of Protocol
Get ready to beg: Executive recruiters are too busy for you — Allison Levitsky
It’s a difficult time to hire. So difficult that you might be tempted to hire the services of an executive recruiter. But good luck with that: Fees are soaring; wait times are increasing; and recruiters may now, in fact, even turn down your business. It’s tough out there, hiring managers.
Data providing insight into the performance of athletes’ bodies is being used to assess their value and help them get better. One Purdue University outfielder, Cam Thompson, has glowing praise for Intel’s 3D Athlete Tracking: “It made me a whole lot faster, where I’m close to the top in the fastest on the team now.” But baseball players have few rights when it comes to who can access that information, and Kate did a fantastic job of exploring the complexity of this little-explained meeting of technology and sport.
Here’s one from the archives. This week, Sequoia named Roelof Botha its global leader, but a couple months back we explained how Roelof had become one of the most powerful people in VC. It’s a fascinating story that really digs into what makes Botha tick, and it walks through the nitty-gritty of what Sequoia is doing differently. Also, there’s a great anecdote about pesto.
At the start of the week, the IPCC — the world’s leading body of climate scientists — dropped its latest report on how to fix climate change. It included the technofix Silicon Valley can’t get enough of: carbon dioxide removal. Brian walked us through what it is, why we’ll need it and why we shouldn’t rely on it alone.
A day in the life of a Ukrainian coder working through chaos — Veronica Irwin
Sergiy Netesanyi wasn’t called to fight in the Russia-Ukraine war. Instead, he does his bit by continuing to work from a colleague’s apartment in Lviv, and this account of how he spends his days is fascinating and moving.
Productivity hacks from an Evernote stan — Lizzy Lawrence
If you use Evernote, you should 100% read this. Actually scratch that, if you want to be more productive, you should 100% read this.
A MESSAGE FROM CLARI
"Trying to make every deal as big as possible often adds complexity and extends sales cycles. To accelerate growth, sellers should focus on landing faster, and then expanding, and expanding again. Getting customers into your solution sooner helps you solve their initial problems, then later, you can grow together." - Michael Megerian, Chief Revenue Officer at Yello
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