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The characteristics of the boards who completed the survey were dramatically different, even among companies doing business in the same industry. Perhaps one of the most insightful differences is the make up of the board members’ professional backgrounds and industry experience. For example, there were large variances among companies in the proportion of board members who are company officers, venture capitalists, major investors and independent outsiders.

The average board represented in the survey hosts six members. This mirrors the NACD’s survey of entrepreneurial boards. The finding suggests that boards of small technology firms are substantially smaller than boards at most public corporations. For example, a 2006 study conducted by Spencer Stuart, a global executive search firm headquartered in Chicago, showed that the average S&P 500 firm has 10.7 members on its board. That same study shows a mere 15% of S&P 500 firms have eight or fewer board members.

There is little research to help companies develop best practices for attracting, retaining, rewarding and drawing value from their boards. Often, chief executives are unsure of the appropriate: intervals for board meetings, compensation, and diversity of the board’s members.

The Relative Importance of Cash and Equity

The Entrepreneurial Boards Composition Survey unveiled broad differences in the remuneration structures of public and private technology firms. In particular, the study revealed private companies are much less likely to use cash-based remuneration, such as cash-based meeting fees or a cash retainer. In fact, private companies are much more likely to either not pay their directors, or rely exclusively on equity awards, such as annual awards or awards upon appointment.

Board involvement is fairly consistent across industries, despite some swings in both the high and low end of the spectrum. The survey demonstrates considerable diversity in the frequency of board meetings, for example: The number of board meetings at respondent companies ranged from one to 28 meetings per year. However, 80% of companies had 4 to 12 meetings. The median (mean) number of meetings among respondent firms was six (seven) meetings per year. The median number of face-toface meetings was 4 per year. (See Figure 11.)

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