A cumbersome board can severely impair agility. A small working board can turbocharge it. The Board of Directors should not be comprised of the entire management team, blood or marital relatives, service providers such as company counsel, or luminaries. Doing a thoughtful job of building a capable, helpful, compatible board is a key indicator of the thoughtfulness which the CEO brings to the company building process. Board members should be compensated and they should all be compensated equally.
Options are better than cash, particularly before the company becomes profitable.
If you aren't enthusiastic about compensating someone well to join your board, then they probably aren't the right director for you. Board members should receive a mailing at least 48 hours before the meeting. This package should include a proposed agenda, minutes from the previous meeting, key financial performance measures, and resolutions to be voted. Perhaps most importantly, this package should contain one or two page write-ups by each operating manager and the CEO describing key accomplishments since the last meeting, and important challenges and goals facing the company. Meetings should last two to three hours, begin and end on time, and be run efficiently while still allowing for drill down discussions on important topics.