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Giving two board seats to investors in pre-seed
We’re in the final stages of closing our pre-seed investment round, and we’re facing a bit of a dilemma. Two VCs are investing: VC A is putting in $200K, and VC B is investing $150K. The issue is that both investors want a seat on our board. From what we’ve read, it’s generally advised to limit the number of investor board seats during the early stages to avoid losing control over strategic decisions. The standard practice seems to be to add *one* investor board seat per funding round. We suggested a compromise where VC A, as the lead investor, would get a board seat, and VC B would take an observer role. However, VC B is adamant that they want a full board seat too. Personally, I don’t think it’s that big of a deal to give VC B a board seat—especially since they have a solid reputation and could add value. But one of my co-founders strongly believes it’s a bad idea and could create issues down the line. What are your thoughts? Is it worth pushing back on VC B’s request, or should we accommodate them to get the deal done?2
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