Founder's Story - He Took Notes at 200 Board Meetings—Now He’s Warning Founders About This One Mistake | Ep 241 with Marc Stockli

Episode Date: July 16, 2025

Marc O. Stockli shares the untold truths behind boardrooms, exits, and ego. With over 200 board meetings under his belt and an eight-figure acquisition behind him, Marc breaks down why most founders misunderstand the role of a board—and how to turn it into your unfair advantage. Key Discussion Points: Why boardrooms are broken—and how to fix them The day 9/11 shaped his lifelong obsession with boards What every founder gets wrong about advisors and governance How to recruit high-level board members even if “you’re a nobody” When to reject VC money (and why most founders give up control too early) The true cost of a bad board—and the hidden benefit of starting early Behind the scenes of a failed exit… and the Ponzi scheme that almost derailed everything What founders must do today to prepare for a successful exit tomorrow Takeaways: A board's job isn’t control—it’s “support and challenge” Information asymmetry kills board effectiveness—solve it with proximity and culture Founders with integrity, humility, and curiosity attract the best board talent If you're not ready to spar, you're not ready for a board Closing Thoughts:This episode is a masterclass in long-game thinking. Whether you’re pre-seed or post-exit, Marc’s wisdom reframes the way you see leadership, advisors, and your own ego. Bookmark it. Study it. Revisit it before your next big decision. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

So, Mark, it's great to see you again. We met the first time in India at a retreat, which was really nice. I had a great time out there. It seemed like you have some amazing knowledge around boards. I was having a conversation with the founder recently, and they were just saying how they couldn't understand how it would even be possible for them as a startup to have advisory. to have a board, but it's something that they wanted. So I really wanted to understand from your perspective around what is the benefit and how does a non-publicly traded company, non-large

corporation even tap into what it means to have a board? Thank you. I mean, and yes, I fully agree that Janry Bangalore, you know, getting to know you was a very special setting and beautiful. I've been very cash in up of boards for a long time. It really started on a very informative, day 9-11. I had crucial board meeting every time with my former company. So that was really the starting point for my journey about. And ever since I've taken notes in every single board meeting. Thank you, Daniel. And yes, January catch-up in Bangalore was amazing, a truly unique experience. I've been passionate about boardwork ever since. Very infamous day, 9-11. I had a board meeting at the time that then was interrupted and we switched to the screens and followed that.

But it was a very crucial board meeting and a very influential board meeting at the time. And that really piqued my interest. And I've taken notes ever since and I've been passionate at the board and that has accelerated in my time as global chair of EO where I ran a lot of board meetings in a somewhat different context. And in essence, what I observe with almost all of my entrepreneur friends is that most have a very critical view of their boards. Some don't have a boards because everybody has a bad experience with it. And my fundamental thesis is it should not be this way. Many of us who

need to have a board for size of the company reasons or we have external investors or family governance reasons, you know, when we have to do it, why not aim to do it well? And I think one policy many startups do is to start too late because it's like any other thing. It's It's not something that you will do well from the very start. You will take a warmer period, a training period, to really practice boardroom dynamics, board preparation, and all those things. So I really think better start a little bit early. And for me, the main benefit, what I consider for me, that the key role of a board at its very shortest is support and challenge. and it will always be the case that the founders

or the family business owners, the CEOs, they will always be more competent on the business. They're 24-7 on the business, in the business. They know all their clients. They know the business model. They know the product, right? You'll never be as competent. But that more distance from the day-to-day

can also be an advantage if and when used properly. That, you know, not seeing the forest for the trees, that perspective with more distance with more objectivity maybe with different type of patterns that you know that is the value of board can bring into. There's a lot of things that need to be in place

for that to work, but when it works, it can be magic. You're talking about seeing the forest through the trees and we all have egos and I would imagine that the reason why people don't want to have that perspective is because you know, we think we know everything.

it's our company, it's our baby, it's, you know, you insulted, it's like insulting your child, but even though it might be constructive feedback, what do you think holds people back from getting that perspective? I think you hit the mail on the head, and it's actually even one, one chapter in my forthcoming book, really exactly deals with this keeping the ego in check, you know, leaving the ego, checking the ego at the door. Typically, when you are in the boardroom, you probably have some degree of achievement. achievements in your life. That most often comes along with a certain self-confidence. And then,

you know, there is a fine line from self-confidence to ego. Now, if you have too many egos in the boardroom, that's not going to be good, right? I think what you require is really a willingness to listen, a willingness to accept that, you know, in some things I might know more than you and then other things you might know more than me. But that combination of sparring each other, of challenging each other, that again is the magic. And I think kind of this ego question combined with what we in EO called the Shoshin, the beginner's mind in Zen Buddhism, this childlike curiosity, those are crucial element to have healthy board dynamics. Give you an example. And we alluded to that. You know, as a say, I'm a VC on a board of a tech company.

Now, if that company enters a transaction, quite likely as VC, I will know more because I've done so many transactions and the founder might be the first or second or third, but probably not the 25th, right? So I as I might say, okay, I know so much more he needs to listen or she needs to listen to me. On the flip side, the same thing you might go through the CEO's head, founder head and says, I know the business so much better. I know my product inside out. How can they add value, right?

but exactly that distance can add value, that that neutral perspective, that asking fresh questions that maybe I have not picked up. That is the beauty of having this sparring, this challenge. For that to work, though, you need to bridge a pretty difficult thing, which I call the information asymmetry. Typically, as a board member, I'm quite distant from the business. I need to have information flow, so I have enough context to be able to support the challenge, to know enough.

that I truly can be of value to the people who are on the business, who run the business, the executive team, the CEO. The quarterly board pack, a quarterly meeting, will never, ever be enough. No matter how good that board pack is, no matter how smart a person is, it will not be sufficient. The information gap will be too large. So I, for example, I have a habit, for example, to bridge that gap more. I have a habit.

I co-locate, so I spend a day, two days a month, on site of all the companies where I serve on the board. Just to feel the room, to have water cooler discussions, to have informal meetings, to feel the vibes. I also in one company where I chair the board every month, every week on Monday, I get the list of all the birthdays, about 250 employees, birthdays and anniversaries. Let's just speak two or three and I call them during the week.

They get recognition, they feel heard, and I get the sense of what's going on. And those are the things I need to do as a board member to be effective. If I'm not willing to put up that effort, better not serve on the board. If somebody was like, I don't even know, Mark, what does it even really mean to have a board? Because I think there isn't, I've never seen it clearly defined or clear definition of what that even means. There's two facets to it. There's the legal obligations and those vary by jurisdiction. But in the most cases, in most jurisdictions that come to mind,

clearly the ultimate responsibility for the business lies with the board of directors. So there is a serious legal obligation responsibility for the well-running of the company, for not having fraud. So clearly there's some really supervision duties that are part of the governance. That is the more formalistic part. That is not the part I so much focus on because that is quite well-established. and there's enough literature on governance on that part. What I really focus on is more the soft part of what does it take for a board to truly operate,

kind of what type of board behavior, what type of board dynamism, boardroom ambiance, do you need to create, to be aligned, to have a healthy challenge, a healthy support system, a healthy checks and balance that is constructive, that advances the enda, and not becomes a nuisance and kind of an obstacle and a hurdle. So let's say I'm somebody who maybe new to business or been in it for a little bit, but I, you know, I've never had a big exit, never had an IPO. I've never achieved a certain amount of successes. So I want to go someone, I want to go to someone like you who's had a lot of different

successes and been through a lot of experiences. But what, how do I entice someone like yourself or these types of people and say, Hey, I want you to be on my board of directors, but who am I? I think, again, there's probably two sides to the coin to make that work. One is kind of the monetary incentive, and the other one is the more intrinsic one. Starting on the intrinsic one, I think most people are either motivated by the people and or by the offering, by the value proposition, product or service that you bring to the market, right? Ideally, it's both, right? That they fascinate me, that I think, you know, we're going to have fun.

It should be fun to work with, you know, it shouldn't be a kind of a burden either. There should be chemistry. There should be complementarity. A feeling of, okay, my skill set is of value to you. It's impactful and vice versa. On the monetary side, typically in an early stage setting, a board member would not expect to be paid in dollars in cash. But you would be willing to share some upside. There's some established kind of formulas, depending a little bit on what.

stage your company is you can be anything from say 0.2% to maybe 0.75% of equity per year of service on the board. Ah, amazing. Okay. So the equity, so the longer you serve, the more equity is possible to the person. Yes. And the earlier you start, the smaller the company, the higher the percentage might be and then it might decrease. Kind of where in the life cycle are you? Yes. And would the equity only really turn into dollars or currency if there is some sort of like acquisition or IPO or are they going to get like a yearly percentage of profit? No, I mean, again, I mean, it depends a bit what companies we talk. But if we talk like venture backed and kind of fast companies, oftentimes they don't really make profit, create profits for quite a while, right? They usually kind of externally fund it for quite a while.

If they make profits already, we're a different program, then they also can pay in cash. So in the more venture-backed tech setting, the expectation is really, basically, you're treated as an employee. You're typically part of an ESOP, you know, you have vesting periods, you really accumulate stock options that only become valuable, basically if some or all of the equity becomes valuable in a sale, in an IPO, in a grand scale, in a trade sale of the company, or possibly in a large round. later stage where some secondary where private equity company might take some older shareholders out and be willing to pay out some longstanding shareholders. When you look back to the exit that you had, I believe you had one in 2021, a lot of people talk about the excitement around what happened. Obviously, it's a great monetary benefit I'd imagine for most people. But I don't hear a lot about the challenges, the tough times

of the process of the exit. How was that like for you? Again, you really hit it. It was the third time that we negotiated the exit. In every single time, we did not look for it. We were approached once very early in our life cycle. Then a second time, that's the second time we were approached. We were so close to signing with an American buyer.

And really, literally a few days before our counterpart, the CEO of the company aiming to buy us, disappeared. It just became incommunicado. And for two weeks, we had no clue what's happening, called, emailed, tried every channel there was, until we learned that the person was arrested by the FBI on a federal case, wire fraud, ended up serving, I think, 60 years or something. The whole thing was a Ponzi scheme. The company basically did not exist. His investors or their investors had been defrauded. there were fake employees, fake clients.

We had done a reverse due diligence and nobody found anything. We were so close to basically selling to worthless equity. So third time lucky, the real exit. It was almost a year process between interest and signing closing. Very stressful.

We had initial, very fast progress, very strong cultural alignment. And then for a long time, it was a very tedious game of negotiation of due diligence. and I learned, I realized too late that our buyers had financial sponsors and still have a financial to a private equity backed. And in our case, we were their first acquisition.

So the financial sponsor was above average risk averse. So on the legal terms, they were extremely strict. It was compensated. I think we got a very, very good offer on the monetary side and the good package on the monetary side. But the legal, you know, the reps representation warranties were, I mean, our lawyers sometimes told us you cannot accept that. We were quite at ease accepting tough terms because we had built a company from scratch. We knew we had no skeletons in the closet. But it was a very drawn out. It was also American acquire Swiss company. Swiss company not be willing to operate

under American law. American buyers not willing to operate under Swiss law. So we chose UK law. So it was complex for many reasons. It was very stressful. And the signing on December 21 in 2021, still with mask for COVID, was a big, not just the monitor side, but it was really a moment of pride to really close a chapter together. It was quite a beautiful moment. That's the moment that most entrepreneurs look for. At least certain parts of the world, obviously they're building companies because they wanted to go down 15 different generations.

But for, you know, many places like in Europe, in the U.S., at least, you know, we're looking for that exit as like the pinnacle of success. If you look, or let's say you're on the board of a newer company and they're like, hey, Mark, what should I do so I can get ready from day one for a possible exit of the future to have, you know, to eliminate some of the stress that might be happening? Very tricky question. For one, I think it's really probably more promising to build a business not primarily from a financial reward, but really from either a problem solving or a creation kind of perspective. You know, I really want to build something. I want to solve a problem. And also, you know, the typical VC question, what's your exit strategy? I always was quite averse to that one. I always, in my whole time of building my own company, I always kind of maintain the stance. I said, if we build a successful business, optionality will result, right?

If we have, you know, if we build a growth company, if we build a profitable company, if we establish a stance as kind of a really world-leading product, we will create options. Now, obviously, that is not, you know, VCs have a time horizon where they need to translate an investment into liquidity. That's their game. That's what they owe to their investors.

So those clash And that's an interesting board dynamic, right? There's inherent conflicts of interest with investors serving a new board because some of them have a really clearly defined limited time horizon. I as founder might not. I just served in a company of such a structure

where investors made a lot of pressure to the founders to sell. And the founders were completely convinced that they can kind of accelerate and really drive the company forward easily another five years. And you know, really 10X or the business yet again, that is a very, very tricky conflict of interest to treat and to navigate.

Which I think a lot of people now are reconsidering where they get the money from. Used to be like, absolutely, we see money. Now you're like, I mean, with so much technology, maybe you don't even need the money. You know, maybe you don't need. It's like a badge of honor before like, oh, I raised money. And now it's like, yeah, but if I bootstrap and I don't have to give out control, there's some founders that I know of a really popular company. I didn't even realize that maybe a year or two, two ago, they were just kicked out of their own company.

And then I hear a lot of stories around people that gave too much equity. So even when they exit for a large amount, they don't even take any money home. Yes, it's a mixed bag, right? You know, investors can be phenomenal. There's extremely helpful. There's very, very, very impactful investors that really add besides just the money. I've seen, I just serve on a company that is, you know, fairly advanced, has a board that has quite a few of their investors on the board. They also have some conflicting time horizons, all that, but they navigate it with a lot of civility and fairness.

And yes, and then there's really the war stories, the horror stories, you know, people have large exits, but because of the liquidation preferences of the investors, they basically walk away with nothing, having worked hard for, like, eight years, 10 years, whatever. There's really not necessarily neat. It really depends on the sector. I always say if people have a business model and the way to bootstrap, by all means, not everything needs to be built so fast and, you know, needs to rush and things. And sometimes, yes, there is really a need to be fast because it's really kind of not the winner takes all, but the winner takes a lot situation and then, you know, serious funding. But at the moment the market is clearly moving from fast growth to real or earliest profitability, right?

that the needle with the interest environment has clearly changed away from fast growth at all costs to better be sure you have a very, very defined path to profitability. There's this whole talk around, you know, the solo founder, barely any employee's unicorn. A billion dollar com. Yeah, yeah. Leveraging AI to basically, having AI agents and stuff is based all your employees. I was just reading about some. He just exited, I think for $80 million, just a couple employees here and there.

no raised money, but all driven through AI. How do you see the future of AI agents and companies leveraging AI to basically replace a whole workforce? I think it's happening. I think the big game will be the combination, right? I think most of the time AI will replace, you know, 50, 60, 80 percent of, you know, of a certain function and things. And I think for many things, I think there will be a human layer.

But yes, the human to agent, agent to agent, you know, human agent agent, agent, human. I think that will completely change the ballgame. And I think, you know, this one person billion dollar companies already exist. It's like, you know, the Taylor Swift and the Roger Feders and the Tiger Woods type of assert. But those are, you know, special stories. And, you know, we had those in the past. I don't know. At WhatsApp sale to me, I think there were about 20 people.

somewhere thereabouts. I know it was almost a billion per per employee. So they almost in a way have happened already, but I think that will accelerate. I think he will. And also, you know, the business models become more flexible with, you know, all the, you know, with the hyperscalers, with the scalable infrastructure.

It's just, you know, with the freelance economy, you don't need to hire everybody. You can also do a lot of work with, you know, on a gig, case by case thing. I think there's a lot of very exciting trends in the market. I do think I really think to come back to

boards. I think having a board that works is a unique underutilized competitive advantage kind of overseen by many. Just on these conflicts of interest, having an independent chair, somebody that really can spar with a

close, be to the founder or the CEO, just having this mentor, this sparring partner, with this close, confident to bounce things, you know, I had mentors in my life. That's a very, very powerful and helpful thing. No, you got me thinking about, I started thinking about Clubhouse and how they were offered like two or three billion dollars and they turned it down to Twitter. And then Twitter basically destroyed their whole business model. So I wonder when it's like the flip side.

So it's like, again, I don't know their, I don't know the story of, I know they got money from, you know, large VC. I don't know the pressure. I think it's like Captain Andreessen. Yeah. I wonder how much is, because we've heard this before,

you know, Snapchat turned down money then went IPO and maybe that was better for them. It's like the flip side. So how many companies got great offers, but didn't take the offer, but maybe it was the investors that didn't allow them to take the offer.

I don't know. How does this play out? Because I'm not really an investor. So I don't know the ins and outs of how and who can make the decisions. There's very, very well-known. Silicon Valley VCs that claim at the very least that they never vote against the founders. Now, I don't know if that is marketing or if that's the reality, but I think in an ideal case,

kind of my stance, and again, one company where I chair the board and I work very closely with the founder's CEO, I typically challenge the founder strongly before the board meeting. but if he is convinced and kind of I really can sense that conviction, I have his back in the board meeting, right? So, and I think that I like that model. That does not mean I trust him blindly. I have a very high degree of trust, but I take the liberty to challenge, and I think it's a healthy sign of a board to challenge, to challenge strongly. but at some point I need to follow the person

who leads the business because firmly the CEO is the person that takes the operational decisions we can give input on strategy and long-term visions but the executive team is closer to the business

and if I don't have to I mean the moments of real disagreement they should be rare right challenge before but once you align go and back it and go all in If you're going to go all in on a CEO and you're going to have their back and you're going to see it through, are you looking for certain traits in that person? Because obviously,

I'm guessing, you won't know everything about someone before you back them. You only have the information provided. Yes. So for me, I think that's something that is a bit underappreciated because it sounds very sexy to serve on the board. And, you know, there's sometimes a bit struggling with very young people saying, oh, I'm stopping. Stop. doing operational work. I've become a board member. There's a fairly significant legal responsibility. In most jurisdictions, you really, kind of the buck stops there. If something happens, you're on the hook as a board member, and rightfully so. So my number one thing, I need to be fully convinced about the integrity of the person, right, running the business. If I have any

doubts whatsoever. I serve on the board of financial services of an asset manager, which is obviously quite regulated. So I would never do that if I wouldn't know that's a person I know for 30 years. I'm godfather to his daughter. I know because the risk reward tradeoff, that just doesn't pan out. If something happens in that business, I'm in the newspapers possibly. I can't afford that, right? So the risk reward is very negative.

I can only afford to take that if I have complete 100% trust in the person. So that's my number one filter. If I don't have to trust, if there's any doubts, there's no compensation in the world to make up for it. I like that. Trust and integrity. So Mark Stockley, I don't know where we're going to see each other again, but I'm excited. Whatever retreat, wherever that's at in the world, I'm sure it's going to be fun. If people want to follow along the journey because they need to get your book once the book comes out.

And I'm so fascinated with this world of boards and advisors. and it's just hard to find someone that really has, I don't let's say mastered it, but has this experience like you do. So, you know, appreciate you today. If you want to get in touch with you, they want to follow along. How can they do so?

The best at the moment is LinkedIn. I'm quite active there, and I surely will tell when the book launches a bit closer. The website for the book is also under construction, but it's not up there yet. So LinkedIn for the moment is clearly the best. Amazing, Mark. Always great to talk.

you and thanks for filling me in today. I feel like I have a whole new renewed sense of what it even means to have abort. Thank you. Thank you. I really appreciate it. Thank you.