For founders, the decision to bring in an independent board member is rarely about compliance alone. It is about choosing the right long-term partner for moments when the company’s decisions become more complex.
In this article, Rahul Chandra, writing for Arkam Ventures, reflects on why independent board members matter for startups, and what founders should consider before bringing them in. Here’s what he had to say:
Independent Board Members for Startups
Recently, we invited Ankit Nagori to join the Wooplr board, and he graciously accepted. We saw him as the perfect guide for the scaling part of the journey. Perhaps Ankit saw a differentiated business model at work, where influencer-driven commerce was at the core.
Like all important things, this needed some pursuit. Ankit’s pursuit was jointly led by the Wooplr CEO and me, as we both immediately saw the value and the fit. But you may wonder why go through the hassle of doing something that has no immediate tangible benefit? Why self-impose the discomfort of bringing in a new board member who is neither a founder nor an investor?
This question was first answered for me when I saw the MakeMyTrip board at work. Deep Kalra had brought in three independents after his Series B: Sanjeev Bikhchandani, Frederic Lalonde and Philip Wolf. Each was handpicked by the founder. The value they brought was the strength of their domain and the farsightedness that sometimes comes with having done it before.
The independents took on specific projects such as TVC, new product lines and operations, and worked with internal teams as coaches and guides. In many ways, they acted as strategic advisors for startups, bringing operating judgment into the boardroom without crowding the founder’s role.
Another board I am on, Shubham, a housing finance company, has three independents: Mr. Vinod Rai, Mr. Rakesh Rewari and Ms. Ranjana Agarwal. Each brings years of accumulated experience, pragmatism and varied perspective.
The nature of the board meetings has transformed. There is now a deliberateness of action in sync with the stage of the business and the gravity of managing a mortgage business. The shareholder view, which was mostly focused on company growth, is now tempered by a 360-degree view on risk, accounting standards and compliance.
A young company is preparing itself for the responsibility of playing a larger role in the ecosystem as a keeper of external capital. We may have added years of maturity to the company’s outlook by enhancing the board composition with independents. This is where startup board governance becomes more than a compliance requirement. It becomes part of how a company learns to make better decisions.
As a financial investor nominee on the board, I was involved with the recruiting process for the independents. This involved sharing our commitment and view of the company’s prospects. Why are we excited about the business? Why are the founders credible people to work with? What is the standard of ethics and transparency?
In another business, also in financial services, we gave out a search for an independent. That was a mistake. For a young company, what that does not guarantee is the motivation that the independent needs to add value to the startup. Our expectations were also thwarted by the lack of understanding of the business and the lack of communication between the founder and the independent. It was a waste of fee and time for everyone.
This is an important lesson for founders thinking about independent startup directors. The role cannot be treated as a box to be ticked. The best startup board members bring relevance, motivation, context and trust. They understand their responsibilities, but they also understand the stage, ambition and constraints of the company.
In my experience, there is no right age to bring in an independent. The aspect to keep in mind is that this is a long-term relationship and should be thought through carefully for fit, ideally led by the founders.
Truly independent members, or even those excited enough to invest their own capital and have skin in the game, are invaluable. They bring new perspectives, foresight and business understanding that would otherwise take years to learn.”
The central takeaway at the heart of this article is that startup governance works best when it is founder-led and intentional. The right independent can help a company mature faster by bringing experience and perspective into key decisions.
