Building a Board/Advisory Board/Exec Team

2,455 views
2,408 views

Published on

Start-ups need lots of help. This is in the form of board of directors, potentially advisors, and a great executive team.

1 Comment
2 Likes
Statistics
Notes
  • This is a great deck on advisors and their relationship to other startup insiders - Board, CEO, and Leadership. Short and well presented with useful tips. Thank you Janis.
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
No Downloads
Views
Total views
2,455
On SlideShare
0
From Embeds
0
Number of Embeds
497
Actions
Shares
0
Downloads
96
Comments
1
Likes
2
Embeds 0
No embeds

No notes for slide

Building a Board/Advisory Board/Exec Team

  1. 1. It’s All About The People: Board, Advisors, Executive Team Janis Machala Managing Partner Paladin Partners [email_address]
  2. 2. Role of the Board of Directors Fiduciary responsibility to company Liable: mistakes/fraud/etc. Obligation to company first, CEO second More formal than advisory board Legalistic entity
  3. 3. Board of Directors Odd numbers Smaller is better Create a board earlier Recruit an outside director(s) Insiders minimized Consider an executive chairman Board members often require D&O
  4. 4. What is an Advisory Board? A group of individuals who are selected to advise regarding business issues, including marketing, sales, financing, etc.
  5. 5. Role of Advisors Idea feedback Reality check CEO Confidante Access to investors Access to industry/customers Lend credibility Domain expertise
  6. 6. How to Build an Advisory Board Define member profiles Determine expectations Create pitch and comp package Brainstorm targets Seek out targeted advisors Incorporate in company communications
  7. 7. Finding Advisors Friends, family, colleagues, vendors LinkedIn Industry trade associations Industry conferences Industry analysts Complementary firm boards/advisors Recruiters
  8. 8. Advisor Considerations Meet regularly or 1:1? Length and quantity of meetings? How much to pay? Length of vesting period? Trophy, operating acumen, super connector? Recruit for short term objectives Don’t treat them as employees or consultants
  9. 9. Benefits to Being an Advisor: What’s in it for Them? Extending their circle of contacts Developing new business opportunities Getting new perspectives and ideas Contributing to an industry Personal satisfaction: “pay it forward” Resume building Fun!
  10. 10. Advisor Pitch Have comp structure determined Craft a “killer” introduction Articulate company values Explain opportunity in 5 minutes Compelling and focused Set expectation Appeal to their ego
  11. 11. Compensation Food and drink Cover expenses Cash (fee per meeting) Stock options
  12. 12. Terms of Advisor Agreement Description of relationship Disclaimer of employment Payment for services Confidentiality Conflict and how to handle Ability to perform services Ownership of work product Termination
  13. 13. Sample Advisory Board Agenda Why an advisory board? Questions? Introduction of members Presentation of discussion topic Discussion period Proposals/resolutions./options Summary/Action items
  14. 14. How to Get the Most Value Ask questions and listen and learn Come to meetings or calls prepared Write email advisors can send for intros Think of them as investors Communicate regularly Leverage them for their expertise Track action items and outcomes
  15. 15. Resources Sample advisory board letter: sbinfocanada.about.com/od/management/a/sampleinvite.htm Sample advisory board agreement: founderinstitute.com/docs/FAST.doc Great general advice on funding, advisors: www.thefunded.com www.techcrunch.com www.humbledMBA.com www.innovationamerica.us www.techstars.org www.ycombinator.com
  16. 16. Executive Team: Strategists AND Doers CEO President COO CFO CMO VP of Sales CTO VP Development VP Technical Operations VP Professional Services VP of Business Development Any VPs? Some VPs? No titles??
  17. 17. Finding Executive Team Members Start-up execs scarce Beware bigCo execs Networking Executive search Behavioral interviewing Reference check Bad executive hire will cost you $250K to out of business
  18. 18. No Funding, How to Hire? What if the perfect person comes along? Severance pay, merger, exits, etc. The executive invests/brings in investors Key exec starts out as advisor Accrued wages? Work for equity only?
  19. 19. Interviewing Tips Detailed position specification Outcome in 6-12 months Ask the same questions Candidate must know the job Interview for chemistry Always hire for smarts Demonstrates learning ability
  20. 20. Reference Checks: “No Time to Do In-depth Calls!” What does a hiring mistake cost? Find out before your potential VC does Ask for 10-12 in 3-4 categories: Board, investors, peers, employees, business partners, vendors Listen for what is NOT being said Ask references for other references
  21. 21. Exec Mistakes Hiring friends and family Spouses as co-founders Poor performer hangs on Not vesting founder shares No cliff vesting Unsustainable comp plan Deal is too complicated
  22. 22. Some Tips Hire slowly and fire quickly: no hire is better than a bad hire Have spouses meet Envision a long road trip Use StrengthsFinder, MyersBriggs Discuss lines of authority, trust, style, dispute resolution, board/management interaction If you agree on everything…. Hire people better than you!

×