What Startup Advisors Do I Need?

Bob Dorf just published a post Where are the Hackers?  Solving the Founder-Tech Gap that came out of some fun conversations that Bob and I have been having.  A large part of this conversation is what kinds of advisors startups should be looking for.

A little while ago, I suggested that Every Web/Mobile Startup Should Have a Technical Advisor.  The conversation with Bob was about what the composition of advisors should look like.  We both felt that most startups are not taking a very systematic approach to defining with they need in terms of advisors.

Here’s the other aspect that both Tony and I preach: get help. You can’t afford and don’t want to hire a full-time CTO or architect. But, advisors, coaches, and mentors can often fill the bill. Getting someone who’s fully employed somewhere else to work with you on a limited basis to help close the gap is hugely important for the non-technical founder.

While Bob’s post focuses on Technology Advisors and the Startup Founder Developer Gap, we also discussed advisors more broadly.  I wanted to capture some of the broader conversation.

Formal vs. Informal Advisors

In many cases, you can get a couple coffee or beer meetings with advisors without ever formally engaging them as an advisor.  For me, if I can help you within a couple hours Free Startup CTO Consulting Sessions, I’m happy to do that and I don’t expect compensation or equity for that.  It’s not until it gets beyond the initial conversation or two that a formal relationship would be discussed.

There are a lot of people in the startup ecosystem that are happy to do this.  In creating Mentor Night, I’ve been happy to hear how giving most people are.  If you present a mentor with an interesting startup challenge in a space where they have experience or expertise, the mentors are quite willing to spend a few hours to help the founder.  And it’s way more fun when you have other interesting people in the room trying to also help.

Formal relationships make sense once you get beyond the informal stage, and it’s clear that there’s on-going need.  I recommend looking at the Founder’s Institute Founder Advisor Standard Template (FAST) Agreement as a template for this relationship.  Of course, you will want to work out the specifics of how you plan to work together with the advisor once it becomes more formal and adjust accordingly.

In some cases, Founders are building an Advisory Board with the purpose of padding their investor deck.  Investors discount this.  And it can hurt you if it’s purely cosmetic.  They may know some of your advisors and make a call after you meet with the investor.  

Connected Advisors?

I talk to many startup founders who select advisors in order to tap into their connections.  I’m not the biggest fan of this personally.  I side more with Mark Suster who says:

“advisory boards are an expensive equity proposition for merely introductions.”

Yes, you want connected individuals, but you often find that there are a few introductions that come easily and once those are exhausted, the value drops rather fast.

Domain Experts and Functional Advisors

Domain Experts have deep knowledge of your particular domain or aspect of the domain.  Maybe it’s knowledge of the players and dynamics of the mobile ad ecosystem. 

Functional Advisors come in with expertise in a particular area where you may need a second set of eyes.  This might be technology, marketing, sales, operations, international expansion, etc. 

Shafqat Islam looks at how he defined his Board of Advisors for NewsCred:

We spent a lot of time thinking about the exact roles and responsibilities for our advisory board. In that time I realized that we sought out very specific functions and had clear expectations.

Through this he defined aspects like “deep dives into our marketing strategy” and “product feedback and product strategy.”

This is a great way to go through and look at where you might have gaps and figure out what kinds of advisors you might want to approach for informal advice and then possibly formal advisory relationships.

In Bob’s post, he tells startup founders to get smart on product design, software architecture and development process.  That’s great advice.  But if the founder is just learning about these things, then those are gaps where getting advisors likely make sense.

Additional Thoughts on Advisors

Some additional random thoughts on Advisors and links to more information:

• Find advisors who say, “I don’t know but let me look for someone who does.” 
• Know how to navigate your Initial Conversation with a CTO or Technical Advisor
• Advisors 101 for Startups
• Everything You Wanted to Know About Startup Advisors Part 1
• Everything You Wanted to Know About Startup Advisors Part 2
• Five Things to Consider When Selecting Advisors for your Startup
• Why assemble an advisory board?
• Startups and Advisory Board Members
• The Importance of Advisory Boards for Startup CEOs 
• Critical Considerations for a Startup Advisory Board