Establishing an Advisory Board: Getting Expert Advice for (Almost) Free!

When you are running your own business you will often find yourself doing a wide of variety of jobs.  Unfortunately you really can’t do everything.   There are certain areas of your business that are best left up to the experts.  A successful entrepreneur knows where to draw the line and turn to an expert.  A really successful entrepreneur knows where to get that help for low or no cost.  One of the best places to turn to for advice will be an advisory board.

What is an advisory board?  It is a group of experts in various aspects of business that you can use for strategic advice.  Most of these folks you will already know from some other aspect of your life.  They are friends and family members who have gone through building their own businesses.  They are former bosses and colleagues who have skills that are outside of your own skill set.  They are old college professors or the guy down the street who built a successful small business.

Here are some things you should consider when you build your advisory board:

What Do You Need:  Before you start looking at building your board, you will need to establish your business needs and your own skill level.  Decide what role the advisor will play in your business.  Do you need occasional advice or ongoing support?  Is it a short-term role or long-term relationship?  Do they have connections you need?  Those are all questions that you will need to ask yourself when building your board.    Once you decide what you need, then you can start to look to your social and professional contacts for experts to help you build your business.

They Gotta Have Skills:  You can’t have just anybody on your advisory board.  You want true experts that can offer real insight into running your business.  They need to provide support that aligns with the vision of your business.  Ideally you will find a well-respected advisor with a broad network of contacts who can help you navigate those unseen bumps in the road.  Look for someone who will provide instant credibility for your business to help you bring your company to the next level.  Areas to look at include: legal eagles, marketing gurus, financial wizards, and internet experts.

Setting the Limits:  Once you get an expert on board, you need to decide on their involvement in the activities of your business.  The more involved they are in the business, the more you will be expected to pay out for their expertise.

Paying Up:  An advisor is not an employee.  They are paid their for their advice and not for their daily activity in the business.  Some folks will be happy to provide occasional advice for free, but if it is an ongoing relationship you should expect to pay up for their help.  A great advisor should receive something in return for their valuable expertise.  Rather than offer up a paycheck, you can offer up a percentage of the business equity to make it worth their time.  The good news is that you get to set the percentage at the start of the relationship and you will ultimately control their involvement in your business.

About the author:    The Business Girl is Terri Sullivan Biehn.  I have been a professional business writer and management consultant for more than fifteen years.  As a management consultant, I work with entrepreneurs to develop business plans and other documents.  Through my consulting practice, I coach entrepreneurs and small business owners on their general start-up, marketing, financial, operational and management issues.