Comment by FreakLegion

Comment by FreakLegion 4 days ago

As a hypothetical, kind of? But not really. The board is written into the company's bylaws, as a rule, and requires a board vote to change. 'Selling your board seat' really means engineering a complex deal that requires a bunch of other people to sign off.

The same is true of selling your equity, by the way. As a founder you have common shares, but early-stage investors want preferred shares with QSBS treatment. Even if you're allowed to sell your shares, which most startups don't let you do, it's not in your power to convert them to preferred or give the buyer QSBS treatment.

throwpoaster 4 days ago

> 'Selling your board seat' really means engineering a complex deal that requires a bunch of other people to sign off.

The company is at (pre-)seed, so the next round is this exactly: they're probably rewriting the shareholder agreement, for example.

I wouldn't call it more "complex" any other round.

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tptacek 3 days ago

A startup that has a board is a company you can't sell a board seat at. This is past silly. Despite what you wrote earlier, "holding on to and selling" board seats is not a thing.

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- throwpoaster 3 days ago
  
  You're simply wrong, I have done deals like this. You are clearly quite upset about something, and are not providing a clear argument -- relying instead on personal attacks and "no true Scotsman" goal post shifting.
  Good luck to you, all the best!
  
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  tptacek 2 days ago
  
  I have no idea who you are and there's nothing personal about any of this, but I am concerned that people are going to read this and come away with the idea that departing founders with board seats generally sell them, and when they try that, everybody is going to look at them like they're both naive and irrational --- exactly what the original poster said they were trying to avoid.
  
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tptacek 4 days ago

The problem we have in all these threads is that sometimes people just say stuff, because it sounds interesting or it's fun to fantasize about, and it's hard to tell that stuff apart from actual advice.

This person probably doesn't even have a board seat, but either way: you're not selling a board seat.

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