Does my company’s board of directors need to have meetings?
Takeaway: While Delaware law allows for action by written consent, which is common for founder-only boards, holding regular board meetings becomes a standard and expected practice the moment you add your first outside investor to the board.
For an early-stage startup where the founders are also the only board members, a formal "board meeting" can feel like an artificial and unnecessary ceremony. You are talking to your co-founders every single day about the business. The good news is that in this early phase, Delaware law provides a highly efficient alternative to formal meetings.
However, the moment you raise a round of venture capital and add an investor to your board, the dynamic changes completely. At that point, regular, formal board meetings become a non-negotiable part of your corporate governance.
The Founder-Only Board: Action by Written Consent
Delaware law allows a board to take action without a formal meeting if all directors sign a document approving the action. This is a Unanimous Written Consent (UWC).
How it Works: For any action that requires board approval—such as granting founder stock, approving a SAFE financing, or hiring a key consultant—your law firm will prepare a UWC that details the resolutions. The founders, in their capacity as directors, all sign it. This has the same legal effect as a vote taken at a meeting.
Why it's Used: It is far more efficient for a small, fast-moving team. It allows you to legally authorize corporate actions without the ceremony of a formal meeting. In the pre-funding stage, most companies operate almost exclusively via UWCs.
The Post-Financing Board: The Shift to Formal Meetings
When you add an investor to your board, they will expect the company to begin holding regular, formal board meetings, typically once per quarter. This shift is not just about ceremony; it serves several critical purposes:
Fulfilling Fiduciary Duties: A formal meeting is the primary forum for the board to exercise its duty of care. It is where management formally presents information, and where the investor director can ask questions and engage in a strategic discussion to make an informed decision.
Creating a Legal Record: The minutes of these meetings are the primary legal evidence that the board has engaged in a diligent and informed decision-making process. This record is what protects the directors under the "business judgment rule" in the event of a future lawsuit.
Investor Relations and Communication: The quarterly board meeting is the primary venue for you, the CEO, to formally update your lead investor on the company's progress, challenges, and strategic priorities. It is the core of your investor relations cadence.
While the UWC remains a useful tool for handling routine matters between meetings, the quarterly board meeting becomes the central rhythm of your corporate governance after you raise your first priced round. It is the professional forum for aligning with your new partners and making the key strategic decisions that will shape your company's future.
Disclaimer: This post is for general informational purposes only and does not constitute legal, tax, or financial advice. Reading or relying on this content does not create an attorney–client relationship. Every startup’s situation is unique, and you should consult qualified legal or tax professionals before making decisions that may affect your business.