No it doesn't. It's very difficult to imagine a plausible circumstance where you have a company that took significant investment where you could hold a board seat that the board could not eject you from after you left the company. You can't sell a board seat.
This person isn't an investor, but even an investor can't sell their board seat. This is getting silly. "Hold on to your founder board seat and sell it later" is not real advice.
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.
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.
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.
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.
No it doesn't. It's very difficult to imagine a plausible circumstance where you have a company that took significant investment where you could hold a board seat that the board could not eject you from after you left the company. You can't sell a board seat.
"Yes, I'll put another hundred grand into the company, but I want a pref issue with an attached board seat."
This person isn't an investor, but even an investor can't sell their board seat. This is getting silly. "Hold on to your founder board seat and sell it later" is not real advice.
Depends on why you have the board seat.
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.
> '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.
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.
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!
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.