Written By Center for Entrepreneurial Innovation
To help start-ups with setting up an advisory board, we asked HR experts and business professionals this question for their best advice. From determining your advisory board goals to starting small and avoiding long-term appointments, there are several pieces of advice that may help your startup set up its advisory board. Here are nine tips to get started!
- Determine Your Advisory Board’s Goals
- Don’t Fill it Entirely With Family and Friends
- Start Within Your Network
- Obtain Niche or Industry Experts
- Define Clear Roles For Each Advisor
- Don’t Involve Your Paid Resources
- Get Picky and Specific
- Start Small and Avoid Long-term Appointments
- Include a Financial Expert
Determine Your Advisory Board’s Goals
When you build an advisory board, you should choose people who challenge your thinking and guide you to consider different perspectives that help you grow personally and professionally.
Sanat Patel, AVANA Capital
Don’t Fill it Entirely With Family and Friends
My advice for any business that is looking to set up an advisory board is, to first think about what they are going to do for your business. How is an advisory board going to help you in your business? Many times businesses have an advisory board that really is not helping them. The board is filled with family and friends that are not providing any resources or real advice to help the business owner. It’s a waste of time and causes confusion. The advisory board should be composed of people who are willing to help you grow your business and have the experience, knowledge, and resources they can share with the business owner. If you are going to have an advisory board, make sure it has a good mix of people that can help you in your business and have experience in your industry.
Steve Feld, Business Breakthrough Strategist
Start Within Your Network
You shouldn’t have to search high and low to set up an advisory board. Instead, searching for advisory board members should come naturally within your own network. Who are the people you admire? Who are the people who always seem to be several steps ahead? By limiting an advisory board to within your own network, you’ll reduce the amount of time formulating a board and increase the quality of advice from people who really care about your success.
Brett Farmiloe, Markitors
Obtain Niche or Industry Experts
I was on an advisory board for a startup for a few years. Some types of individuals that you should consider having on your board include an executive or strategy coach, a sales expert, a marketing expert, a well-networked industry network, and one of your investors.
Parissa Behnia, Sixense
Define Clear Roles For Each Advisor
Advisors often supplement a function such as legal or HR that is lacking or underdeveloped at an early-stage company. Other times, the role is to help grow the business through the advisor’s network. In either case, it’s important to ensure each member has a clear role and specific accountabilities for contribution over a given time period.
Tim Toterhi, Plotline Leadership
Don’t Involve Your Paid Resources
Don’t fill it with people who are paid resources already. For example, don’t ask your CPA to be on your advisory board. It’s a bit of a conflict. You want people who have expertise in the areas you are trying to work on. And you want them to be honest with you. They need to tell you what you need to hear and hold you accountable.
Diane Helbig, Helbig Enterprises
Get Picky and Specific
Be very specific for the advisors that you’re looking for, both with regard to industry and skillset. If you’re looking for a technical advisor, are you looking for someone that specializes in technology for finance, marketing, or healthcare? And what kind of technical acuity are you looking for? Is it decentralized applications, Cloud or Mobile? You want advisors that can give you very specific advice. Insider info that it would be very hard to get otherwise. As with an advisory board, you are generally giving equity or a hefty compensation, the more specific you can be, the more value you will get back.
Husam Machlovi, With Pulp
Start Small and Avoid Long-Term Appointments
Starting with a small advisory board makes economic sense. This is because getting experienced board members for your startup does not come cheap. Apart from the cost, it is much easier to manage and supervise a small advisory board. Appointing an advisory board on a short term basis will also afford you the opportunity to evaluate the effectiveness of each member of the board. It is easier to get rid of an inefficient advisory board with a short term mandate.
Nonyerem Ibiam, Law Truly
Include a Financial Expert
Reserve a seat on the advisory board for an executive with financial expertise. Financing business needs and growth is essential for startups. By reserving a seat on an advisory board for someone with CFO knowledge, a startup is able to gain perspective in critical areas like increased profitability and reduced costs, as well as strategic areas like compliances and future planning.