(@helaineolen) is a veteran personal
finance journalist, the author of Pound Foolish:
Exposing the Dark Sideof the Personal Finance
Industry, and the co-author of The Index
Card: Why Personal Finance Doesn’t Have
to Be Complicated.
Mind Someone Else’s Business
Why you should join another company’s board.
s an entrepreneur,
you’re busy, busy, busy.
You have a company
to run, employees to
manage, and customers to satisfy. Yet I’m going to suggest
that you make time to do something counterintuitive: help
manage another business by joining a company’s board.
“It’s connections. It’s learning. It’s getting experience,”
says Jane Barratt, founder and CEO of GoldBean, a financial
services startup, and a current board member of Edgewater
Wireless Systems, a Canadian telecommunications company.
Advising another company can often help you become a
better leader of your own, says Sukhinder Singh Cassidy, the
founder and chairman of the Boardlist, a marketplace for tech
companies seeking women board members.
“It made me run more productive board meetings,” says
Cassidy, who’s been a director of Urban Outfitters, Trip-
Advisor, and Ericsson. “The boardroom became something I
strategically managed. You just watch how other CEOs do it.”
There’s also a financial advantage, especially if you join
the board of an established for-profit company. According to
the National Association of Corporate Directors, the median
pay for people serving on Fortune 500 boards is just north
of $250,000. Startups, meanwhile, frequently o;er equity in
exchange for service.
Make no mistake: Sitting on the board of another company
takes a decent chunk of your time. According to an NACD
survey, a typical director can expect to spend 248 hours a year,
or nearly a month of 10-hour days, fulfilling board commitments. And then there’s the practical problem: Board seats are
in high demand and slow to open up—and they mostly go to
white men, who hold more than two out of every three seats
on the boards of Fortune 500 companies.
So how do you find yourself a seat on another company’s
board? Patience, networking, and preparation. Think of join-
ing a corporate board as a long-term process, a goal that the
Deloitte Center for Board E;ectiveness estimates can take
anywhere from two to three years to accomplish. “Positions
don’t come up that often,” says Barratt, who spent a few years
looking for a corporate board position before connecting with
Edgewater. “And the need is often very specific. So if the board
already has, for example, a marketing expert, they might not
want or need another one.”
Consider creating a board résumé or statement, highlighting
applicable skills. Publicly traded companies most commonly
use professional search firms to recruit new directors, followed
by personal networks, according to the NACD’s survey. These
companies are most interested in candidates with specific
knowledge of and involvement in their industry, followed by
financial and executive-level professional experience. “Know
your superpower,” Cassidy says.
There are also programs designed to train entrepreneurs
for board service, such as Deloitte’s Board Ready program,
which o;ers support for executive women hoping to join
corporate boards, or Cassidy’s Boardlist. The NACD o;ers
companies a search service, as well as courses for wannabe
board directors, though membership is open only to people
who are already on a for-profit or nonprofit board.
The latter might be a good first step—as long as you’re
passionate about a nonprofit cause. You won’t be compensated for serving on a nonprofit board, and you’ll be expected
to fundraise. However, such service can provide experience
in executive oversight, something that corporate boards look
for. Nonprofit board membership also is often validation of
standing in a particular community.
“You have a seat at the table, which is often made up of
very important people,” says Susan McPherson, who runs a
New York–based corporate social responsibility consultancy,
and who’s acquired several clients through her service on
four nonprofit boards.
In other words, board service can be a networking silver
bullet. McPherson says, “It widens your circles.”
HELAINE OLEN ; SPREAD THE WEALTH