9 “must do” items BEFORE you begin a board member search. Why?
Maximize candidate alignment and quality
Avoid delays and unnecessary costs
Build relationships with portfolio company and potential future board candidates
Avoid failures that can lead to expensive and painful removals
According to Pitchbook, there were more than 5,100 private equity transactions last year. A significant number of those transactions involved the placement of new board members at the newly acquired portfolio companies.
Board member searches in these situations are often under time pressures. This can drive PE firms to focus on addressing immediate, pressing needs, for example:
- Lagging sales narrow the quest to an individual with a strong business development reputation
- Personnel issues steer the board member search towards attorneys with expertise in HR
This dilation of perspective early in the process often hurts long-term performance. However, taking a moment to review the “45-Second Checklist” for Building Your Board can help improve the chances of success for PE firms and other organizations looking to place board members:
- Avoid pursuits that waste time due to easily predicted non-starters
- Prevent unnecessary conflicts between PE firm, portfolio company, and board candidates
- Circumvent struggles over roles and decision-making authority
- Position for even greater success in future board member searches
Also, consider the potential drawback of NOT taking time to check out the “45-Second Checklist” for Building Your Board: board member removal. While removal challenges can be mitigated with mechanisms like term limits or leaves-of-absence, other remedies like board votes or impeachment can have painful and long-lasting effects.
Bottom line? Be proactive. If a board member search is in your future, download the “45-Second Checklist” for Building Your Board today.
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