Board Dynamics Over the Startup Life Cycle

57 Pages Posted: 14 Sep 2020 Last revised: 18 May 2023

See all articles by Michael Ewens

Michael Ewens

Columbia Business School; National Bureau of Economic Research (NBER)

Nadya Malenko

Boston College, Carroll School of Management; National Bureau of Economic Research (NBER); Finance Theory Group (FTG); Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

Multiple version iconThere are 3 versions of this paper

Date Written: September 2020

Abstract

We explore the dynamics of venture capital (VC)-backed startup boards using novel data on director entry, exit, and characteristics. At formation, a typical board is entrepreneur-controlled. Independent directors join the median board after the second financing, when control becomes shared, and hold a tie-breaking vote. Their presence is particularly likely when the potential for VC-entrepreneur conflicts is higher. At later stages, control switches to VCs and independent director characteristics change. These patterns are consistent with independent directors playing both a mediating and advising role over the startup life cycle, and thus representing another potential source of value-add to startup performance.

Suggested Citation

Ewens, Michael and Malenko, Nadya, Board Dynamics Over the Startup Life Cycle (September 2020). NBER Working Paper No. w27769, Available at SSRN: https://ssrn.com/abstract=3692153

Michael Ewens (Contact Author)

Columbia Business School ( email )

665 W. 130th Street
732 Kravis Hall
New York, NY 10027
United States

HOME PAGE: http://michaelewens.com

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Nadya Malenko

Boston College, Carroll School of Management ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Finance Theory Group (FTG) ( email )

United States

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
36
Abstract Views
443
PlumX Metrics