Independent Director

A board member who is neither a founder, an employee nor a representative of an investor.

Example

An experienced executive with no shares in the company who joins after the Series A.

Independent directors can help balance founder and investor interests, especially in conflicted decisions.

Board Composition — The allocation of board seats among founders, investors and independent directors.
Conflict of Interest — A situation in which a person's personal or other professional interests could influence their duty to act in another party's interests.

A board seat, an observer seat and information rights are three very different things — Board directors vote and carry legal duties. Observers attend without voting. Information rights give access to figures without any role in decisions. Knowing which you hold defines what you can do and what you owe. (9 min)
Decisions that are not recorded are difficult to rely on later — Board minutes, written consents and maintained records are what prove a decision was properly made. They matter most in disputes, financings and sales, when everything is examined. (10 min)
The hardest board decision, and the one most often made too late — Replacing a founder chief executive is rare, disruptive and sometimes necessary. Boards tend to delay it, and the cost of delay is usually larger than the cost of the decision. (12 min)