From the moment you start your business, governance shouldn’t be treated as an afterthought; it’s your launchpad. I’ve seen firsthand that the earlier you bring good governance into the mix and the right people around the table, the more likely you are to succeed.
The days of startups “winging it” without structure are over. When early-stage businesses head out to raise capital without a formal board or a high-calibre advisory group, they almost always struggle. Investors know it. Regulators know it. And increasingly, the media knows it.
Why Early Governance Isn’t Optional – It’s Smart Business
Founder-only leadership is a risky business model. Serial entrepreneurs who are often brilliant, visionary, and determined can also be stubborn, preferring to do it their own way. Without external, independent voices, that mindset can morph into groupthink and blind spots.
The Australian Institute of Company Directors (AICD) puts it plainly: “Establishing a board ensures strong governance and strategic oversight, and ultimately supports the growth and sustainability of your business.” Governance doesn’t just formalise things; it protects the best interests of shareholders, customers, and key stakeholders, and it brings accountability to the table.
The Governance Institute’s Board of the Future report backs this up, noting that 92% of directors agree that boards face soaring expectations in areas like ESG, technology, and risk management. The reality is, founders can’t do it all alone.
The Right Mix Around the Table
When I advise early-stage businesses on board composition, I start with this: have at least one entrepreneur who’s “been there and done that.” Someone who’s exited a similar type of business or scaled through the exact challenges you’re facing. That lived experience is invaluable.
Then, build in complimentary skills including legal, financial, operational, and fundraising expertise. If you’re raising capital, you’ll want people who can help you develop pitch decks, financial models, and investor materials that can withstand scrutiny.
And don’t forget the value of connections. The right board member can open doors to networks you can’t access alone.
Smart Money and Smart Minds
It’s not just about getting capital, it’s about getting the right capital. Smart money comes with strings you want: strategic guidance, industry connections, and the discipline that comes from experienced investors and directors.
The State of Australian Startup Funding 2024 report makes it clear: while capital is recovering, competition is fierce. Startups with professional governance attract investor trust faster, especially international investors looking for Australian innovation. Good governance signals you’re serious, strategic, and investor-ready.
Run It Like a Proper Board (Even If It’s Advisory)
This is one of my biggest messages to founders: if you’re going to have a board or advisory group, run it properly. That means:
- Structured agendas
- Well-run meetings led by a skilled chair
- Detailed minutes
- Clear action items
Even in an advisory board context, a disciplined approach drives better outcomes. Governance doesn’t have to kill creativity; it should channel it.
Be Ruthless About Value
One of the hardest lessons for founders? Not everyone you invite onto your board will continue to add value. Over time, some board members become passengers rather than drivers. When that happens, you must be prepared to make changes.
As I often say, don’t keep the wrong people on the bus. If they’re not showing up, contributing, or delivering value, thank them and move on. Your governance structure is too important to be weighed down by complacency.
When Governance Fails: The WiseTech Warning
The cautionary tale of WiseTech is still unfolding. The ASX-listed logistics software giant, led by its founder Richard White, saw four independent directors resign in quick succession amid boardroom tensions. The Australian Financial Review and The Australian reported regulator concern, with ASIC chair Joe Longo warning: “If that alleged misbehaviour starts to impact good governance… that might be something we’d be interested in.”
The fallout? Market jitters, shareholder unease, and public reputational damage. This is what happens when founder control isn’t balanced by strong, independent oversight.
Your Governance Game Plan
If you’re building an early-stage, high-potential business, here’s the governance checklist I give my clients:
- Start early, with intent – Don’t wait until you’re flush with capital. Lay the governance foundation now.
- Define the board’s role – Create a charter, set clear expectations, and ensure everyone understands their duties.
- Bring diverse, relevant expertise – Entrepreneurs, legal, finance, operations, and independent directors.
- Appoint a strong chair – Someone who can keep meetings disciplined, focused, and outcome-driven.
- Demand genuine contribution – Remove non-performers quickly and decisively.
- Balance nimbleness with rigour – Governance shouldn’t slow you down; it should keep you on course.
- Protect stakeholder interests – Independent voices are not a “nice to have”; they’re essential.
The Bottom Line
Strong governance isn’t red tape, it’s a growth engine. It makes your business more investable, more resilient, and better prepared for scale. It also sends a clear signal to the market: you’re serious, disciplined, and ready to play at the highest level.
If you’re a founder, set up your governance early. Surround yourself with people who challenge you, protect your interests, and open doors you can’t open alone. That’s how you tilt the odds in your favour, and that’s how you turn a promising startup into a market leader.
