Finding Clarity in the Chaos:

We brought together a select group of private company directors for a peer-driven dinner to explore the most pressing challenges facing private boards today.

The discussion was guided by Steve Osborn of Mintz, Tony Perazzo of Grant Thornton, and Jack Lazar, seasoned private company board director and NACD Private Company Director of the Year 2025. Together, the group shared perspectives on how private company boards can position themselves for success in 2026 and beyond, addressing the evolving dynamics between the board and CEO, the role of the first independent director, and how to navigate ongoing disruption driven by technology, geopolitics, and market change.

KEY TAKEAWAYS

Private Companies in 2025

• Private companies are no longer just “small and fast”—many now have large revenues, complex operations, and governance needs on par with public companies, particularly as private companies are staying private for longer.
• For smaller companies, cash flow and capital management remain existential, making governance feel optional—but that mindset shifts around Series B/C funding as they move toward an exit and investors demand more discipline.
• Boards must help founders evolve from tactical decision-making to strategic thinking.

Risk and Resilience

• Equity reorganizations can destabilize boards if not handled transparently.
• “AI slop” is emerging as both an operational and strategic concern.
• Black-swan events (tariffs, crises, geopolitical shocks) are occurring more frequently.
• The directors’ role in a crisis is to avoid panic, digest information, and respond with steady judgment.
• “It’s never as bad or as good as you think” is a reminder to maintain perspective.
• Boards must define which risks matter most for private companies versus public peers.
• Regulatory shifts, such as the European and California AI Act, are becoming increasingly relevant (see “California AI Act” below for more information).

Governance and Board Structure

• Public-company governance benefits from independence and structure; private boards often lack these guardrails until problems surface.
• In family-owned and venture-capital-backed companies, having only one independent director raises questions of real influence.
• Conflicted transactions in Delaware (i.e., “cram downs”) are now encouraged to have at least two independent directors (see brief summary under “Delaware Two Independent Director Safe Harbor” below).
• Compensation committees are often the most tactical way to exert board influence—bringing discipline to CEO reviews, key performance indicators, and pay alignment. Consequences must be enforced if KPIs aren’t met.
• Compensation committees also help ensure employee pay structures are competitive with public benchmarks as the company grows.
• US disclosure practices tend to be more robust than in other markets, shaping expectations even for private companies and a possible pitfall when serving on ex-US company boards.

The Role of the Independent Director

• Independents act as neutral liaisons between management and investors, surfacing issues the CEO cannot and serving as a sounding board for the executive team.
• They can facilitate difficult conversations, often pre-gaming ideas with stakeholders before bringing them formally to the board.
• Independence, neutrality, and communication are the greatest contributions of the role.
• Industry expertise or CEO experience gives independents credibility, especially in leadership transitions.
• When joining VC-backed boards, independents must ensure their role is respected and expectations are set from the start.

CEO Leadership and Coaching

• The central governance question remains: Is the CEO the right person to lead?
• In private companies, replacing the CEO is often harder than in public companies, as VCs may be founder-friendly and founders struggle to let go.
• Neutral third parties (e.g., lawyers or independents) can support tough CEO succession conversations.
• Coaching is highly valuable but should remain separate from performance evaluation.
• Younger CEOs are proactively requesting coaches and to be part of peer group exchanges, signaling cultural change.
• Bringing coaches into board settings helps normalize leadership development and strengthening CEO performance without it feeling targeted to one individual.

Talent and Growth

• Private companies are competing directly with public firms for talent, requiring more structured compensation and governance.
• Artificial intelligence is reshaping the workforce, accelerating the need for mentorship and leadership-development pipelines.
• Family businesses often lag in governance and equity structure, but generational change is slowly pushing more formal practices.
• Independent directors in family businesses face unique challenges when ownership resists change.

SPEAKERS

Board Director, AsteraLabs Inc., Box Inc., GlobalFoundries Inc., Resideo Technologies, Inc., Tonal Systems Inc., NACD Northern California Chapter

Jack Lazar

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Jack has over 30 years of Silicon Valley experience with a focus on finance and operations. He has served in executive leadership roles at GoPro, Qualcomm, Atheros, NetRatings, Apptitude, and Electronics for Imaging...

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Managing Member of Mintz’s San Francisco office

Steve Osborn

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Steve Osborn, a managing member of Mintz’s San Francisco office, is a versatile corporate attorney who draws on his in-house legal and business management experience to advise clients on transactional, corporate finance, and general corporate matters. He has particular experience with middle-market mergers and acquisitions and regularly advises clients on exit strategies. Osborn represents public, private, and emerging growth companies in a variety of…

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Regional Managing Partner, West Region, Grant Thornton LLP

Tony Perazzo

Tony Perazzo is Grant Thornton’s West region managing partner. He leads a team of Audit, Tax and Advisory experts working with senior management, boards of directors and other key decision-makers across geographic areas and industries. …

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