Notion invests exclusively in early-stage enterprise software companies, with the ambition to build global category leaders. We have 35 companies in our portfolio; while each is unique, they also have much in common.

In particular, they all share the need for the founder to build a high performing leadership team and – ultimately – a board. When we invest they may have ten people in the company; if they achieve their objectives then within 7-8 years they may well have ten people on the board.

The decisions about when and how to build a board, let alone one that is high performing, are not ones that many of our founders have made, and while for some it may be some time before they actively do so, nevertheless in our experience the earlier these discussions are made, the better.

We recently hosted a dinner with Harvey Nash, a selection of our portfolio leaders and some hand-picked company leaders, advisors, CEOs and board members to explore this topic. This is a summary of that conversation...

Do I actually need a Chairperson?

Typically for early-stage venture-funded companies, the makeup of the board may well be driven by the demands of their investors, and the question came up from the start, "do I actually need a chairperson at all?"

Stephen Chandler, Managing Partner at Notion, did not believe it was mandatory or necessary but recognised the value when you get the appointment right in the right circumstances.

We do not advocate the importance of appointing a chairperson at an early stage, however when needed, we have seen the very powerful impact it can make. Stephen Chandler, Managing Partner, Notion Capital.

When should a CEO consider a chairperson?

• If there are multiple VCs around the table with contrarian views
• A first-time CEO managing fast growth
• A company going through turbulent times.

Let’s assume we do appoint a chair, what’s the role?

The Chairperson must start by understanding their role and asking themselves what their value is. It may well be on strategy, which is often outside their remit, but is always focused on four key areas, James Greenbury, CEO at Parcel2Go explained.

Four key areas of focus:

• Do they have great people on the leadership team (and beyond)
• Does everyone know their job and does the team work well?
• How are they incentivised and is that in keeping with the strategy and goals?
• Do they have a culture and a way of behaving that aligns with the business?

The last of these – the issue of behaviour, culture and values was one we returned to throughout the evening and without a doubt the area of strongest consensus as to the most important area.

How do we build high performing teams?

Monika Biddulph, General Manager of Systems and Software outlined the importance of focusing on the fundamental traits of high performing teams across the business, and in the leadership teams:

• Levels of trust and openness amongst the team,
• Constructive dialogue and challenge mandatory,
• Making decisions and holding themselves accountable to those.

All of these are just as relevant at board level as any other team and this led back to the question of whether early-stage companies needed a chairperson at all.

The role of chairing any meeting, even a board meeting, can be rotated among the leaders – but more importantly, everyone must be open and challenging not just sticking within the narrow definition of their role, according to Neil Berry, VP International at Comcast.

Everyone needs to take responsibility for challenging decisions and everyone on the leadership team should be capable of chairing board meetings. Neil Berry, VP International at Comcast.

In his career spanning multiple tech companies with many VCs through to IPO, Neil had never worked at a business with a chairperson and was adamant that it was far more important for everyone to step up than one person to be given responsibility.

Every member of the leadership team must be open and challenging, not just sticking to the definition of their role. Neil Berry.

Rotating the responsibility of chairing the board, doesn’t just reduce the burden on the CEO, it also forces everyone on the team to take a far more strategic perspective.

The question of openness was also one that many felt strongly about - not just open within the board, but open about the decisions of the board to the rest of the business.

Tim Andrew, CEO of Localz, kicked this off by describing how he shares the board minutes/actions out throughout his business.

How critical are culture and values at board level?

The answer was simple, values and culture are as important at the board level as they are across the business in setting the tone for how businesses work at the highest levels of growth and success.

We learned what it means to be "ARM shaped".

• We not I
• Passion for progress
• Be your brilliant self

And James Osmond was adamant that their ability to embrace values that were authentic and memorable allowed them to hire better and grow faster:

• Be a rocketship
• Make the customer go weak at the knees
• One team
• Obsession with learning

In conclusion

• Focus on the fundamentals of building high performing teams at every level - open/challenging/accountable - and the role of the chair at early-stage may well be moot;
• If you do hire a chair, then understand the specific challenge they are coming in to solve and choose someone who will park their ego at their door; and
• Focus on the values of how you behave up and down the business and same attitudes must prevail at the board

And when to hire a chairperson?

Leaving the last word to David O’Toole, of Harvey Nash.

When to hire a chairperson? If the company is growing fast; the company needs to change, or if the company is failing the right outsider can provide much-needed clarity and direction. David O’Toole, Harvey Nash Executive Search.

Posted by Stephen Millard, Chief Platform Officer at Notion Capital.