Board of Directors

A board of directors is a group of people (or even just 1 person) that’s main function is the oversight of the startup, not management of the day to day operations of the startup. The board of directors will make high level decisions, including whether to raise capital or sell the company (although in certain situations the startup’s shareholders will also have to approve a transaction initially approved or authorized by the board of directors).

The board of directors is elected by the stockholders of the startup. States like Delaware permit a board of directors of just 1 person, but a board of directors for a venture-backed startup will typically be either 3 or 5 person boards.