The purpose of an entrepreneur

March 14, 2011Post by Laura Humphreys

Just been working on a talk I am giving this Wednesday on an entrepreneur’s perspective of the role of a Board of Directors.  I only have 5 minutes to speak so has been a very good exercise in making it short but real.  So here it is… you can have a sneak preview of my 5 minutes of fame:

The purpose of an entrepreneur is twofold:

1.  To build a company with a higher purpose (think Richard Branson, Bill Gates, Steve Jobs, Anita Roddick and others such billionaires who make a difference to our world)

2. To build an exit for the shareholders (think Sam Morgan, the Trilogy sisters, Geoff Ross, Rod Drury for local heroes who have built a successful exit)

Why does an entrepreneur need a Board of Directors?

1. To challenge the strategy (to the exit and on-going)

2. To hold them to the goals and plans

3. To reality check the numbers

4. To hold the owners/management accountable

5. To support through the tough decisions

In a nutshell:

  • The purpose of a business is to create wealth for its owners
  • The purpose of a Board of Directors is to be true to the business (in its mission to plan and execute the exit)

That’s it… what do you think?