Building a Board of Advisors

An advisory board has no legal authority over a company, so founders are free to take the advice of advisors or dismiss it. By selecting advisors wisely, outlining their responsibilities and keeping them well-informed, founders can create a huge asset to their company that offers credibility, contacts and invaluable guidance.

Think About Goals

Note down your goals and create a list of people in your immediate and extended network whose skills and experience could help you achieve them.

Picking Personalities

Your advisory board should include each of the four different types of advisors:

• The Expert: Your company lacks skills in a certain area, but doesn’t necessarily need a full-time employee with such skills. The Expert has deep knowledge of the area in which you’re deficient and effectively fills the void.
• The Connecter: This individual is highly connected to the people you need on your side like high-profile journalists, investors and influencers who are difficult to contact.
• The Outsider: This advisor comes from a different industry, or may even be an artist or an academic. What’s most important is that this person is prepared continually to ask questions.
• The Motivator: This advisor is a friend, mentor or family member who inspires confidence and keeps you and your top brass grounded.

Landing Advisors

Canvas your networks to find people who meet the profile you’re after. Avoid cold calls and emails, but try LinkedIn to see if there’s anyone you know who can make an introduction.

Solicit candidates with a two-page prospectus describing your business and explaining why you want them on the board. Ensure you have a written agreement that includes a non-disclosure agreement and a charter outlining your board’s meeting frequency, expected time commitment, term of office and the terms of payment. Compensation could take the form of a per-meeting fee; at the very least, you should cover any expenses they incur to attend the meetings, and provide meals when you get together.

After you land an advisor and the agreement is signed, draft a release announcing the addition; promote it on social media and add his or her name, picture and bio to your website along with your other advisors.

Design Meaningful Meetings

Your board should have meetings of no more than three hours, two to four times a year. Try to look forward rather than over-analysing the previous quarter during these meetings. Set an agenda with three or four core matters that target future milestones and send it to advisors at least a week in advance of the meeting along with an invitation for advisors to suggest additional topics.

Integrate and Communicate

Communication with advisors should not be limited to advisory board meetings. Set up an email list with informal updates and invite casual discourse within the group. Have advisors stop by the office or company events and allow them to establish relationships with employees at the firm.

Have you considered created an advisory board?

Adapted from an article on docstoc.com