Board Seat

A position on the company's board of directors, giving its holder a formal vote on major decisions. Lead investors usually take one as part of a priced round.

Why it matters

Board seats are where real governance power sits, above ownership percentage. How the board is composed, founders, investors, and independents, shapes who controls the company's biggest decisions.

For example

After leading the Series A, a VC takes one of three board seats, sitting alongside the two co-founders on every major decision.

Go deeper

Board Seat The Holloway Guide to Raising Venture Capital · article This is the founder-side reference that draws the exact line you need: it says outright that not every seed investor takes a board seat, keeps early boards to 1 to 3 people, and it is blunt that an observer seat is not a free consolation prize (observers push investor interests, every future investor then demands one, and confidentiality leaks). Use it to justify offering an observer seat instead of a voting seat to a lead who wants in. Open holloway.com →

Related terms

Also in Starting Up

See how founders actually handle this on Raising your first round, part of the Starting Up hub.

eChai Partner Brands