How UiPath’s European Founder Kept Control and Built an Expert Board of Directors For His High Tech Startup

 

European startup founders typically raise their first funding rounds from European venture capital firms.

While being private they tend to be subject to governance rules which have been copied from the US venture markets.

The awakening comes as the successful founders approach the opportunity to take their startup public in Europe: They are often faced with lower valuations, loss of founder control, and with boards which are elected by shareholders without CEO and founder input and control. And hence, Daniel Dines of UIPath elected to list the company's shares on NYSE.

Going public on U.S. markets like NYSE or NASDAQ comes with specific governance boundary conditions. For instance, they allow for the founder CEO to serve as the chair of the board of directors. An in reality, UIPath is a founder 'controlled company' in NYSE terms but tries not to appear as such. For instance, three of the board members are venture capitalist who helped fund the company and yet are listed as 'independent directors'. It is not surprising, that UiPath's governance score is low. 

But there is no statistical correlation between a company's governance score and total return to shareholders. 

Read on if you want to find out how UiPath’s Daniel Dines kept control and built an expert board of directors for his high tech startup 👉 here 👈

This article was first published on LinkedIn on December 5, 2023