Horowitz argues that a board's primary function isn't just strategic advice, but to legally protect the CEO. Running material decisions like equity grants past the board shields the CEO from personal liability and lawsuits—a danger many founders underestimate.

Lawyers are paid to minimize legal risk. A CEO's unique role is to balance that counsel against other crucial factors like customer trust, employee morale, and future opportunities. Ceding decision-making entirely to the legal team is a failure of leadership that can lead to catastrophic, albeit less immediately visible, losses.

Unlike competitors using crypto to operate outside regulatory frameworks, Kalshi's CEO views on-chain technology as a tool to enhance a regulated system. He envisions using it for clearing to improve immutability and transparency, enabling a permissionless ecosystem built upon a compliant foundation.

Horowitz argues that forgoing a board is a massive legal risk for CEOs. A board's primary function is to provide a legal shield. Running material decisions, like equity grants, past the board protects the CEO from personal liability and lawsuits from shareholders. Without this process, founders are dangerously exposed.

As a federally regulated exchange, Kalshi employees are prohibited from trading on their own platform. This prevents direct product testing, or "dogfooding," forcing the team to rely almost entirely on customer feedback to iterate, a significant challenge for building an intuitive financial product.

Horowitz cautions against board members having daily, high-frequency interactions. A CEO ultimately must stand alone and develop high conviction to make difficult decisions. Constantly looking to an outsider for answers can stunt this growth and lead to poor outcomes, as the outsider lacks full context.

Tarek Mansour views Kalshi's strict, federally regulated approach as a strategic advantage. It forces robust system pressure-testing and makes the platform an unattractive venue for fraud or insider trading, which naturally flows to unregulated, offshore alternatives.

CEOs are often exceptional at building relationships, which can co-opt a board of directors. Directors become friends, lose objectivity, and avoid tough conversations about performance or succession, ultimately failing in their governance duties because they "just want them to win."

Deciding whether to back a competitor is fraught with conflict. When the speaker considered investing in Stripe, a Square executive called it a conflict, but CEO Jack Dorsey approved. This shows opinions on threats vary internally, justifying multiple checks before proceeding with a potentially conflicting investment.