Thoughts from Marti Nyman, Agitator
I just got off the phone with a young entrepreneur who’s trying to get his startup off the ground. He called because he needed advise on a prospective deal he just received. When we met earlier this summer, he asked if I’d be interested in being on his Advisory Board – to which I replied, as lawyers and tax accountants do – “it depends.” I told him I’d love to help him, but on two conditions – if my background and experience brought value to his business and more importantly, if he was committed to engaging his Advisory Board for help and guidance on a regular basis. I never received any follow up and while I know he’s very busy, it said something about where the AB fit on his list of priorities.
One of the most underutilized assets in the world of entrepreneurship is other people’s experience. This is available in forms ranging from casual coffee interviews to customer “deep dive” discussions to formal Advisory Boards. I fear that an already overloaded work schedule all too often gets in the way of more entrepreneurs taking advantage of this valuable source of insight, guidance and ideas. It should be used a LOT more than it is today, so for would-be entrepreneurs out there, here’s a quick guide to Advisory Boards.
Why do I need one? Two reasons: 1. Building a lasting company will invariably involve making mistakes – not lethal ones, but (hopefully) learning ones. 2. Other people have made these mistakes and their willingness to share may speed your learning curve – where you can make other mistakes and learn and grow.
When do I need one? No scientific formula here but a couple of indicators that should signal it’s time to get some Advisors on board – 1. Your idea is out of the garage, starting to get in front of customers (even beta) and showing early signs of growth, 2. You’re (seriously) thinking about raising capital, 3. You’re starting to hire more than 1 – 2 new people/month (e.g. growth is happening), 4. Your business is going to need to some key strategic alliance partners in some very big companies. That’s just for starters.
Who do I ask? Again, “it depends”. Things to look for include – industry experience (esp. the one you’re competing in), specific competencies (finance, marketing, etc.), technical expertise, (influential) access to important organizations and people, startup experience, etc. Note of caution – don’t just look for titles here – there’s plenty of people that don’t carry C-level or VP titles who can have valuable experience and can provide tons of value.
How do I start one? First, spend some time thinking about what you need – it’s all situational, so think thoroughly on what/who/when. Second, reach out – start talking with people, asking who they’d recommend, etc. Be open, be candid, be nice. Third, set expectations – on both sides – what do you expect from them? When will you need them? What can they expect from you, etc. Fourth, be patient – it’s all about chemistry, timing and relationships, so choose very carefully. Lastly – USE THEM – don’t ask someone to be on your AB but talk to them casually twice a year. If you’re not talking on a quasi-regular basis, at least set up a quarterly meeting/call/review to keep them in the loop. They want to help for a reason, so don’t discard that gift they’re willing to share.