Many closely held companies don’t have a functioning board at all. Investor-backed private companies usually have boards, but many are dysfunctional, neither helping management perform at higher levels nor managing risk.
Not all private equity investors are created equal. They all have their own agendas, ranging from long-term conservative company-building to flip it fast and get out quick. Make sure you know which kind you’re dealing with by getting to know your potential investors first.
Robert Sher is founding principal of CEO to CEO, a consulting firm of former chief executives that improves the leadership infrastructure of midsized companies seeking to accelerate their performance. He was chief executive of Bentley Publishing Group from 1984 to 2006 and steered the firm to become a leading player in its industry (decorative art publishing).