The CEO & Board Relationship: My Take

I have been doing a fair amount of public speaking lately, and a surprising question that comes up repeatedly from food industry entrepreneurs & investors is around how a CEO can build the best working relationship a board of directors. Many entrepreneurs struggle with this question.

Over the years I’ve had quite a bit of experience in this area, in both a publicly traded and private company context. This is something I am very passionate about because a good company culture goes hand in hand with a good board culture, it is nearly impossible to have one without the other for anything other than short periods of time.

During my first week as Co-Founder & CEO of Once Upon A Farm, I sent my board the following email to ensure that we all got off to a great start building a company culture that will, with hard work and some luck, lead to business success and the creation of an industry leader.  That plus the fun and happiness of all involved, is the goal. The email outlines my philosophy on this subject and I hope you entrepreneurs out there will find this useful. Good luck building your boards and your businesses!

Dear Once Upon A Farm Board of Directors,

Thanks to all of you for having trust in me for this mission. It is going to be crazy, exciting, and in the end I think quite successful. But the path between now and then will have many zigs and zags, steps forward and steps back. I wanted to write you with my thoughts on the board and how I think we should operate. How I think about things, and how I hope to best leverage all your collective experience for the betterment of the business and the planet.

I've had many boards, some have been excellent, some have been horror shows that have sucked resources and energy and almost tanked the company. I had both over the years, and have also seen both as a private investor in other companies I've worked with. I am sure you all have seen the same.

We are going to have the former, not the latter!

Here are my beliefs for a board:

- I believe in strong corporate governance, full mutual transparency, and full engagement from a board as we progress.

- We need to be organized, efficient, and focused on the right things. We will discuss committees and how and which ones to have at some point in the first meeting or two. We are small but we need to act like the business we will want to grow into in order for that to happen. We will act like a professional board, even though we are a very small enterprise.

- Board meetings need to start on time and end on time. The risk in a business like this where there are multiple people on the board also in operating or quasi operating rules in the day to day is for board meetings to descend into detailed operating meetings. That is a trap we are going to avoid, but it will be tempting to go there, so we all need to be cognizant of that and avoid it.

- The board does not run the company, that is my job. Conversely, the board is responsible for making sure I am doing a good job of that. The board should expect nothing other than full transparency from me, and should expect that key strategic decisions that are board worthy should be elevated for board discussion. I think I have enough experience to know what those are but certainly look for any feedback from you collectively as well as we progress.

- The board should understand the risks and opportunities and approve our financial plans for good governance, and should also be involved in understanding and approving our capital raising strategy and timing. The board also plays an important role in compensation governance, as well as ensuring strong financial processes and controls are in place with audit committee oversight and direct engagement with our outside auditors.

- The board should be aware of all key hires and the comp committee (when we form one) should play governance role on comp, but I will not be running hires by the board for approval, that will be cumbersome and unproductive in a business moving as fast as this one will need to move. I may ask for some people to interview for your advice on fit and skill sets, but only as needed.

- Confidentiality is crucial. We need to keep our plans secret and to ourselves. We need to be careful what we share with the outside world. This will be a high-profile venture, and just our announcement will trigger interest and even new work projects inside many big CPG's. Let's not make it easy for our competition. We will all have temptation to talk with our friends and many people in our industry will be asking questions. Let's have a cone of silence outside our board group. No sharing where we might take the brand, categories, customers, channel strategies, nothing...We will need every second of speed advantage. So expect that I will go crazy if there are any leaks from this board on our plans other than what we intentionally decide to release as a group as part of our total communication strategy. 

- I like keeping my board up to date with frequent communication. I generally do that in three ways:

(1) generally at the end of the week I will send a short email note with some highlights, sales, key wins, key losses, problems, victories, setbacks, etc. This is not a note that is meant to create new work or even deep engagement from anyone, it is meant to keep us all close on the pulse of the business as it will be fast paced. It takes me 15-20 minutes a week and this form of communication was highly effective over the course of my Annie's run. I will start doing this in the next few weeks.

(2) A solid monthly board packet. This will take time to develop for sure and will evolve. But it is my teams job to get into a good routine on financial reporting and to report on key milestones achieved, and report on those. We will start doing these in the next few months 

(3) A highly productive quarterly meeting (live or over phone is fine), generally no more than 2 to 2.5 hours. I find that longer meetings get filled up no matter what so I prefer to keep them shorter and focused on the right stuff. A quarterly financial review, milestone review, any issues of strategic importance. And finally, time for a short exec session if that is needed. I think it is a good practice to assume there will always be one, and the board can pass on it if it decides.

I am always happy to talk if you have a question or a concern, just email me and we can set up a time. Know that the pace of work and activity will be insane so I appreciate your support in being as efficient as we can. I will respect your time too, but do expect that I will reach out to ask your advice. I have a ton of experience but I do not know everything, not even close, I am always learning and I will be tapping all of you for your experience in order to do the best job I can steering this business to success. You all have unique experience that will be huge to our success and I look forward to leveraging that to the max!

I'd ask that other than these three communication venues, that you avoid reaching into the company or to our staff directly. People on the team can get very confused about priorities if they are getting a lot of inbound from a board. I've seen that many times in companies like this. If there is something you want or need from the team, please come through me and I will ensure that you get it without taking the team off the rails. This is a very common trap that happens in boards of all company sizes and I want to avoid it.

In terms of the board and our interaction with each other, I demand the same that I expect of myself with others. Open, honest, and candid conversation. Productive and supportive, focused on winning and building the best business we can for the long term. That does not mean we will always agree, although most of the time we probably will. I want diversity of opinion and input from my board, that helps us reach the best decisions. But after we have a debate as a board and we decide, I expect all to publicly support it and each other. Excessive back channeling, selective hallway conversations, and the like are cancerous on a board just as they are in a company management team and culture. I will not put up with that nor do I expect any of you to do so either. 

So that is my philosophy and I thought it important or you all to hear it before I even start as an employee here and we can discuss in detail at our first meeting if needed to make sure we are all on the same page.

Off we go!

Best, JF