So You're a Startup: How to Create & Maintain an Advisory Board
After a very busy week, we’re ready for another entry in the So You’re A Startup series. We’re covering the topics you need to be informed about as a startup and hoping to answer any questions you might have about starting up.
Want more startup advice? Check out the other posts in the series.
So You’re A Startup number 7 is all about creating and maintaing an advisory board.
What is an advisory board?
Your advisory board will provide you with invaluable advice and feedback and hopefully help steer your company in the right direction.
Take note – an advisory board is vastly different from a board of directors. A formal board of directors is legally liable for the company itself, whereas an advisory board is a group of mentors there to help you out – most startups won’t have a formal board of directors.
What do you need to about creating an advisory board?
1. Create a “dream team.” Make a list of the best advisors and mentors that your company could possibly have, then try to figure out how to get them. Even if you never end up getting them on your advisory board, making this list is a great starting point and it will get you thinking about what kind of people you want to go to for advice.
2. Think about your weaknesses. In order to figure out what kind of advisors you need, you’re going to have to identify your company’s weaknesses. It’s not a fun thing to think about, but identifying these weaknesses will allow you to create a board who can help you strengthen them.
3. Map out your startup’s key goals. Create a list of your company’s goals for the next 1-3 years and then seek out advisors that are experts in the areas that will help you achieve those goals.
4. Do it soon. You need to put together your advisory board as soon as possible. In the early stages, it’s okay if it just consists of your founders and one or two outside people. Getting this together as early as possible will force you to be much more organized.
5. Don’t just ask your friends. For obvious reasons, having an advisory board full of your best friends will not be advantageous. You need to find people with diverse backgrounds who will be honest with you and give you the cold hard facts about what your startup needs to do to improve.
So you’ve followed our advice and put together an advisory board. Now what? What do you need to know when you have your advisory board in place?
1. Be prepared. You don’t want to waste your board’s time, so be prepared with the proper documents, questions, and reports for your advisory board meetings. They’ll appreciate the effort you put into these meetings and will hopefully respond with an equal amount of dedication.
2. Listen to them. You don’t have to agree with everything your advisors tell you, but you should listen to everything they say. You have them on your board for a reason so consider everything they say even if you don’t agree with it immediately.
3. Don’t do absolutely everything they say. Don’t blindly follow the path your advisors put you on. Always take their advice into consideration, but also be sure to really think about the suggestions they’re making for your company. After some careful consideration, decide what’s best for your company – it might not always be what was suggested to you by your advisors.
4. Keep your board flexible. You probably shouldn’t be changing up advisors every week, but as your company evolves, you may see a need for new advisors. Your company’s needs are going to change so your mentors should as well.
5. Meet on a regular basis. You need to establish with your board how often you’re going to meet. Set those dates in advance in order to create some accountability. By planning ahead, there’s a much greater chance that everyone is going to be ready to meet up and discuss the pressing topics at every meeting.
Having an advisory board will really benefit your startup. If you’re in crisis, it’s great to have a group of people to go to that know what’s going on in your company already. You will quickly realize the value of having people to talk to who aren’t a part of your startup, people who can give you an outside opinion and don’t have cloudy heads from being completely immersed in what you’re doing.
A huge thanks goes out to Andrew Jackson from the Accelerator Centre for sharing his knowledge of advisory boards with us.
Tune in next week for SYAS number 8, how to incorporate.
