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Every Startup Needs an Advisory Board

Written by: Martin Zwilling

Article Overview: Every startup faces a myriad of challenges that are well beyond the scope of any founder, so you need a few guiding lights to illuminate the road ahead. These should be carefully selected, with a proven track record, and completely trustworthy.

Every Startup Needs an Advisory Board

Every startup faces a myriad of challenges that are well beyond the scope of any founder, so you need a few guiding lights to illuminate the road ahead. These should be carefully selected, with a proven track record, and completely trustworthy.

Let’s talk specifics. I recommend that every early stage startup find three Advisory Board members. These should all be people who bring credibility and value to your company just by their very association with your name. They should have deep backgrounds and experience in a relevant domain to your startup, and executive experience in running a company.

For example, if your startup is building a high-tech software product, a dream team of advisors would be a former CEO or high-level exec in another software company, a former software marketing executive, and a former CIO or financial executive. I use the term “former” here to imply that they may now be slowing down or retired – this being a good thing in that they may actually have the time and inclination to help you (but we all know some very busy people who still find time to help).

Even still, you should offer compensation. Based on my experience, it is reasonable to offer 1% ownership in your company to each advisor, plus expenses, and a small annual stipend of maybe $1000. For this, you should expect participation in monthly strategy and review meetings, and unlimited access via phone or email for questions, mentoring, and advice. Even more importantly, you should expect these members of your team to be your advocates to Angel or VC investors, or even be part of your friends and family round.

To bring real money and credibility to your company, and help you avoid costly mistakes in development and strategy, a first-class Advisory Board is a small investment. If you think that you and your company can’t attract this caliber of help, you may not be trying hard enough, or you may be riding the wrong horse.

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Article Tags: advisory board members, caliber, costly mistakes, dream team, executive experience, financial executive, guiding lights, inclination, myriad, proven track record, real money, relevant domain, software company, software marketing, software product, specifics, stipend, tech software, vc investors, wrong horse



Related Forum Posts
Forming an advisory board - [quote="TheRainmaker":2vn60npf]As far as isolation goes, I found the concept of building an Advisory Board/Team to be a huge benefit. With my team I can talk freely and openly and I have made some lifelong friendships to boot.[/quote:2vn60npf] Hi Jude, Can you share some tips on how you first started your advisory board? Was it originally just family and friends or were you able to recruit some of your customers from the very beginning? Thanks
Good Advice for Beating Depression and the February Blahs! - Thanks everyone. Your feedback and tips are great. I have also been recommending to clients (and doing this myself) that they go back and revisit their mission/vision for their company. I find it recharges the meaning behind why we are working so hard. I also went to the salon for a girls day! Life does seem so much better when your toes look good. As far as isolation goes, I found the concept of building an Advisory Board/Team to be a huge benefit. With my team I can talk freely and openly and I have made some lifelong friendships to boot. Spring is just around the corner everyone....Keep up the great work! J
Advisory Board - Steps 9 & 10 - Hey Everyone - Sorry for the delay. I have been battling the flu the last few days which has been brutal. But I guess I cant complain, my jeans are loose and I'm down 6 pounds in 72 hours. ;0) Pretty soon I will be back at my high school weight of 117 only 5 more to go! ;0) Anyway, onto the last two steps for setting up your Advisory Board. The caveat with each of these steps is that it is YOUR board. You decide what you want and need and then work it out so it delivers. Step 9) Keep your Board Members Informed There's nothing worse than having a great team of advisors - who dont know what's going on. Once you have your board in place, its important to keep them motivated and excited about your business by giving them updates at times when you arent soliciting their advice. The fact that they have agreed to be on your board means they care about your company - so keeping them up to date will help them be of greater value to you. They are champions and evangelists for your business - commit to giving them constant communications so they can share the message. 10) Fire Bad Board Members. if you realize you have made a bad choice, get rid of him or her as fast as you can. Because your advisor board is not a formal board of advisors you wont have the typical legal issues - but you will have a good management/leadership task on your plate. Tread carefully and lightly but remember that the longer a 'bad seed' sticks around, the longer it takes to remove the 'stench' after they are gone. Just think Omarosa - and cut em loose! This can be very uncomfortable but if you act with integrity and are really upfront about what you need, you should be able to bypass having to let anyone go. Go slow in bringing your board together - perhaps have existing advisors talk with / interview potential new advisors in order to confirm your decision of fit. Good luck! I'm here to help! Jude
Just A Hello From newbie - Hello All its Adalia From Yucca Valley , California . i just want to say that i'm glad i join this Board , Such a nice Board with lots of info, can spend hours here reading all the great post. Thanks
Re: I am a newbie to this forum - Yes, on the Board Index page there is a search where you can see what we already have going. If you are looking for a particular subject, that's a great place to start and it keeps us from having multiple threads on the same subject.


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