Re:Bob Cringely Fired from His Startup
by slapshot on Friday March 05, 2010 @04:15PM
(#1170508)
In many venture-backed companies, the Series A (and B, C, ...) shareholders are guaranteed a certain number of board seats--solely by virtue of holding preferred stock. The founders (who hold common stock) have no control over how the preferred shareholders use their board seats.
If the preferred shareholders have an outright majority on the board, it's black and white that they can effectively fire the founders.
If the preferred shareholders have an outright majority on the board, it's black and white that they can effectively fire the founders.