At a mentoring session at GROW I was asked about advisors and what entrepreneurs had to keep in mind when forming an advisory board. Here are a few quick tips:
- You want to focus on few but really engaged advisors – having 2-3 people that can help you on a weekly basis is much more useful than having a large advisory board that is not engaged and that you need to educate most of the time (instead of them helping you).
- Putting a prominent name on your advisory board for the sake of the name is o.k. if it helps you to gain credibility but don’t exaggerate it – too many prominent names are usually suspicious.
- It is always a good idea to formalize the relationship between advisors and the company – what time commitment is expected from them, what do they get for it (i.e. options), etc.
- Try to get your advisors to invest a bit of money – in the best case scenario they should have skin in the game too.
- I found it personally most useful if the company organized an advisory board meeting every 4-6 weeks that allowed the whole group to come together – getting the input from every advisor can create very productive discussions that would not have happened in a 1:1 environment
- Most investors will not join an advisory board if they are not invested in your company – they already have too many board commitments so you are usually wasting your time trying to recruit them.
- Advisory Boards Offer More than Great Advice (community.constantcontact.com)