VC: “And we’ll need a board seat.”

Me: “But we just agreed to all those veto rights.”

VC: “Yeah we just want to make sure we have full visibility.”

Me: “But you just told me about how pleased you are with how the company has been run until now.”

VC: “Yeah but our LPs expect us to always take a board seat.”

Me: “So you trust us, but your LPs don’t?”

VC: “They don’t even know who you are yet, won’t know until we make an announcement. Most of them will never care about you unless you mess up, and then they might sue us.”

Me: “Can we get them on the phone now? Maybe they’d be happy with just your veto rights?”

VC: “You’ll meet each of them briefly at the annual investor event.”

Me: “Great, can I ask them for advice on problems in the business?”

VC: “Don’t you EVER tell them anything negative. That’s our relationship to manage, not yours.”

Me: “So I’m giving you a board seat so you can act as a board proxy for people who don’t know and may never know what’s going on?”

VC: “Uh… yes.”

Me: How about appointing a Board Observer? They have rights to attend board meetings, receive the board pack, speak at board meetings. But doesn’t get to vote.”

VC: “Board Observer? Never heard of it. Don’t trust it.”

Me: “But I think it’s what you actually want.”

VC: “What I want is for people to go to the Team page of our VC fund’s website and see how many great startups I’m on the board of.”

Me: “You didn’t actually say that, did you? I just imagined you thinking it. This post just went all magic-realist.”

VC: “Well, you guessed correctly, that’s what I was thinking.”

I’m Alan Jones, an EiR for startup accelerators, GP at M8 Ventures. Previously investor, founder, and early Yahoo PM. Opinions mine (but should also be yours).

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