Advisory boards · Early stage

Formal Advisory Boards for new startups - invaluable or window dressing?

Dave Heer CEO at IndieWrites

April 12th, 2014

I've had a couple of people suggest creating a formal advisory board for my early-stage startup. While I have a couple of successful friends who are acting as informal sounding boards for me, it seems to me that getting a more formal arrangement with experienced, highly-skilled, well-connected outsiders could be good for my company.

But I've also heard that the kind of high-flyer you'd want for an advisory board frequently doesn't have enough time to devote to the new company and that, as a result, the significant slice of the company that you give to advisory board members is usually not worth it.

Anybody have particularly strong experiences with advisory boards one way or the other?

Dave Lemley Consulting Technologist

April 13th, 2014

most of my prior ones were more honorary, potentially lending credibility to the company through well known names; however I will say that one particular advisor on my last startup's advisor board was exquisitely helpful.  So I guess the answer is choose wisely depending on what is your goal, and maybe others will have advise on how to get them to do some useful work for the equity that you are probably dispensing out.

Ryan Nurmela Managing Director at bigCampus, Inc.

April 14th, 2014

An advisory board can be 100% invaluable. I've had good advisors and bad advisors. I once had an advisor tell me to my face that "I'm a horrible businessman." He was a nice guy that I enjoyed talking with and spending time with, but he just never shared the fuller mission or had confidence in myself or my team. I've also had an advisor that has participated in the design process, rallied behind the team, and shared invaluable industry insights from his 30 year background.

The good advisors are the ones that step up to the plate when needed, providing network, review, and sometimes small amounts of work on your behalf. Bad advisors imply that they will do all of these things but somehow never do. Good advisors bring a set of experiences that can be strongly leveraged in the company design process.

It's the person, not the role, that is important.

R. Douglas Hulse Co-Managing Principal at Select BioVentures, LLC

April 13th, 2014

I am a believer in Scientific or Medical Advisory Boards. I have never felt the need for a Business Advisory Board since the Bard of Directors should fill that role and I have a strong business background. If you are a scientist with limited business experience then you may well want a Business Advisory Board. In any case, approach this from a rational point of view. First decide what role you want the Board to play and then select people that can advance that role. In a message dated 4/13/2014 12:19:33 A.M. Eastern Daylight Time, reply+dsc+1165@founderdating.com writes: _Dave de Heer_ (http://mail.founderdating.com/wf/click?upn=VRkJVp6SEp-2BgJ9c6K7LU-2FyqPvewFeE-2FrZFMCa8b5JkhZKQYHTzZbSyZr3CckD7ITQTliPp0Z7E8VCYYKq8aFuA -3D-3D_QMBryfaEiz12N4IS7dVs-2FYPURfS-2BRsSUj8YgAilFkLYQp15ga6dSWp-2F1ZkOUJ07 He1-2BiHbeIhUA-2BmhKTCFlcNMDpc-2FUHwCPEL4gvUi4WobpPuiIpKiZa6NUu-2BiDT2kqemCq 4C-2F9l6tZGXA4gWiL1YXHj6DUPAN0c4E4bU1QMIuoxb5BQMjrwpqPYSQPzh5inswGUI9p4la8Ni MrvjuBU9TQbnCyK7Oy-2Bn8s5gd0kvFxefc3CZ1bzrHkK3zDG-2FUp2) started a discussion: _Formal Advisory Boards for new startups - invaluable or window dressing?_ (http://mail.founderdating.com/wf/click?upn=VRkJVp6SEp-2BgJ9c6K7LU-2FyqPvewFeE-2FrZFMCa8b5Jkii8oy4r6eU1o5XQrF1BEcTXw-2FIEJ8m-2BcducxZTz-2BaC-2Fg-3D -3D_QMBryfaEiz12N4IS7dVs-2FYPURfS-2BRsSUj8YgAilFkLYQp15ga6dSWp-2F1ZkOUJ07HSA pHOhMrQZl3df-2FH1HmX8plqandyqEvgmzhSdt30DzSZgeky35XdFAFta2AHks1-2Fnky4XxY29t ztF8PRhBqXeT274UrO8R8yxLbYbPaR2GlYyqTcHMDnJmAwImOM8tYxOfyZbPR-2FYKo6HHGNsSVZ nCaq97wF1WFzCbGxo1LG2yN5TOhzjr01CH0G1GJ2ByaU) I've had a couple of people suggest creating a formal advisory board for my early-stage startup. While I have a couple of successful friends who are acting as informal sounding boards for me, it seems to me that getting a more formal arrangement with experienced, highly-skilled, well-connected outsiders could be good for my company. But I've also heard that the kind of high-flyer you'd want for an advisory board frequently doesn't have enough time to devote to the new company and that, as a result, the significant slice of the company that you give to advisory board members is usually not worth it. Anybody have particularly strong experiences with advisory boards one way or the other? ____________________________________ _Follow Discussion_ (http://mail.founderdating.com/wf/click?upn=VRkJVp6SEp-2BgJ9c6K7LU-2FyqPvewFeE-2FrZFMCa8b5Jkii8oy4r6eU1o5XQrF1BEcTfoKhC-2FusM8A3Hth UTLfKqw-3D-3D_QMBryfaEiz12N4IS7dVs-2FYPURfS-2BRsSUj8YgAilFkLYQp15ga6dSWp-2F1 ZkOUJ07HF1msmFdj135ryhWFEkWEhuQopK-2FrZxXWRgT1DysRn1CK5Slp-2F3HVXmRC6gB102-2 FfVtQ-2FrWkQq4-2BTApHgKo7DgYVhstA4yD7Bsi8kW7WFQ-2FoBYt5PUDUBPqAQpGdrviAPQ18s CZv5MwrQ-2FaBbqjCfSyDGLgmzbR6L68rKZCkUqNtg1SP-2BbTJGkm98rwYgubyh) or Reply to this Message Directly to Participate ____________________________________ _Manage your email notifications_ (http://mail.founderdating.com/wf/click?upn=VRkJVp6SEp-2BgJ9c6K7LU-2FyqPvewFeE-2FrZFMCa8b5JkhYHanK5R-2FsqFJAxjNz7lSM9 4HV0XMUU93uaH2w-2Bripmg-3D-3D_QMBryfaEiz12N4IS7dVs-2FYPURfS-2BRsSUj8YgAilFkL YQp15ga6dSWp-2F1ZkOUJ07HulcnjcCc5pMmrSgniEKCdsxI0j-2FwzeGaTh7nwAjTNtQJwmaeOr rbDn-2BGp7x-2FVKda5Nxwb-2B3yacHChutH0wB-2F5CrGjlTMpNR3QiGWKJFi3IqA2P8lU1QmyG -2FxJ4TNk-2F2ryoluDsQMyXVboGRZkmMPilDMh-2FJfnv9Vh7OKzyjAGuf24N8CjJWO-2BW9b0J

Rob G

April 14th, 2014

It depends on your objectives.  Sometimes you need window dressing, sometimes sage business/technical/sales/biz dev/marketing advise and/or connections. Either way be sure to tie any equity compensation to performance when possible. For example, if you bring on a heavy hitter for his/her industry connections be sure to tie his/her compensation to actually delivering on those connections - not just a phone number or an email intro.