# Board of Directors

## Quick Definition

The governing body responsible for major company decisions, composed of founders, investors, and independent members.

## What is the Board?

The board of directors oversees company strategy, hires and fires the CEO, approves major transactions, and represents shareholder interests. Board composition changes as companies raise money.

## Board Structure Evolution

**Pre-seed:** Often just founders.  
**Seed:** Might add one investor seat.  
**Series A:** Typically 5 seats (2 founders, 2 investors, 1 independent).  
**Later stages:** More investor and independent seats.

## Board Control

Control matters for major decisions: selling the company, raising money, hiring executives. Founders should try to maintain board control through Series A, but often lose it by Series B.

**Formula**

Common board structures:

- Seed: 3 seats (2 founders + 1 investor)  
- Series A: 5 seats (2 common + 2 preferred + 1 independent)  
- Series B+: 7 seats (2 common + 3 preferred + 2 independent)

**Example**

Series A board composition:

- Seat 1: CEO/Founder (common)  
- Seat 2: Co-founder (common)  
- Seat 3: Lead investor partner (preferred)  
- Seat 4: Second investor (preferred)  
- Seat 5: Independent director (mutually agreed)

Founders + independent = majority control if independent is aligned.

## Related Terms

[**Protective Provisions**  
Veto rights given to preferred shareholders over specific major company decisions.  
Learn more](https://www.runfutureproof.com/terms/protective-provisions)

[**Liquidation Preference**  
The right of preferred shareholders to receive their investment back before common shareholders in a sale or liquidation.  
Learn more](https://www.runfutureproof.com/terms/liquidation-preference)

[**Pro Rata Rights**  
The right for existing investors to participate in future funding rounds to maintain their ownership percentage.  
Learn more](https://www.runfutureproof.com/terms/pro-rata-rights)

## Learn More About Board of Directors

[Fundraising **Board Reporting That Builds Trust (Instead of Just Checking a Box)**  
Learn investor update best practices and board deck templates for Seed to Series A startups. Build trust through transparent reporting that strengthens investor relationships.  
Read article](https://www.runfutureproof.com/blog/board-reporting-that-builds-trust)