Most startups (especially those that want to raise money) these days have advisory boards. They’re usually made up of industry insiders, startup founders and execs, and other impressive sounding folks.
Originally I was resistant to creating a formal advisory board because it would take away cycles from talking to potential customers. Then, like any good entrepreneur, I changed my mind.
Lots of posts have been written on this topic and maybe I should have read some of them! Nonetheless, here’s my thought process for the key decision points I’ve thought through (or am still thinking through).
Why did I decide to form an advisory board for my startup?
first question you must ask for any successful project, venture, etc: “How can I get others involved?” (Cc: @garychou)
— John Gannon (@johnmgannon) May 21, 2014
Forming an advisory board provides a semi structured, low cost, low risk way to get more smart people involved with (and cheering on) your startup. I like that a lot.
Who did you ask to join your startup’s advisory board and why?
I’m asking people to join who check as many of these boxes as possible(in no particular order):
- Domain expertise (industry, technical, or functional)
- Passion for our problem area (the intersection of marketing, recruiting, and technology)
- Strong network in their domain
- Willingness to help with ad hoc things that come up (“Hey, do you know any great salespeople?”) as well as things that might require a deeper dive (“Hey, could you review this board deck and let me know what you think?”)
- Solid human being (In other words, someone I would like to spend time with)
Although many startups use advisory boards as a way to pack in a bunch of ‘name brand’ folks on their pitch deck I’m trying to resist the temptation. Maybe this will come back to bite me but I’d rather get people who are excited to really lean into helping us vs. just letting us put their name on a slide and hoping we don’t bug them. :)
How will you compensate your board of advisors?
Advisors will get a small chunk of equity as I want them to share in any upside that they help the company create. From what I’ve read and experienced myself this is fairly standard procedure.
Besides that, what else will an advisor to your startup get out of this deal?
When all is said and done we’ll have 5-7 advisors who cut across different disciplines and functional areas. I’m sure there is a lot I will learn from them. There’s also a lot they could learn from each other. I’m going to help make sure that cross-pollination happens. Helping them extend their networks is the least I can do.
Feel free to call out any gaping holes in my logic in the Comments :) Next post on this topic will be about how this actually works in practice!