We have an Advisor wishing to get involved - had 4 good meetings, he has an A1 track record in household name co,s just concerned about the deal...

"Is it worth my time?" Given that the compensation from an advisory board is equity in a private company with no actual market for it's securities, this is really the most important question. The likelihood that advisory board compensation will result in real financial compensation is very low, and yet the demands on your time are very real and can be significant. Is your time better spent in other areas? "Is this company the most deserving of my generosity?" Because I enter into advisory relationships understanding that the likelihood of real compensation is so low, I evaluate whether to have such a role more from a perspective of how much I like the founder(s) and how much I want their product in my own life. If I don't really enjoy spending time with the founder(s), it's really not worth my time and energy. If I don't want the product in my own life, why would I spend time thinking about it and the business behind it? To get clarity on those two main questions, I don't enter into advisory agreements immediately. I only do so after I have spent some time with the founder(s) on more than one occasion. And what I'm particularly observing is the founders' willingness and ability to receive feedback. Ideally, the founder updates you specifically on the actions taken and not-taken from the last time you were with them. We all observe differently, but I think it's paramount that you trust the advisor actually can implement your advice and counsel. Is the Company "hoarding" advisors? More than 3 advisors to a Company is generally indicative that the founder is more interested in building social proof than getting advice and counsel. That can sometimes be acceptable in industries where proven expertise is really helpful and almost required in the early days of the business. "Are expectations aligned?" Has the company articulated clearly the expectations of your time and involvement in a way you feel comfortable with being able to deliver upon? Happy to speak to you in a quick call to answer any further questions on the topic.

Standard here is 1% with a 12 month vest, assuming the kind of involvement you're describing. message me your email on Clarity and I'll send you the standard docs which also spell out involvement. I've answered this exact question before so I would suggest to all new Clarity members that you use the search to see if the answer to your question already exists. I would caution you that an advisor shouldn't be responsible for things that fall into the "execution" bucket.

There are two types of advisory boards: For show (i.e. credibility) or for help. They should intersect but often don't. The "For Show" advisory boards are usually no more than 5 (though I've seen up to 10) and are meant to demonstrate a significant depth of subject-matter expertise and credibility to potential customers. They act as a form of "social proof" for, meant more to be a form of "light endorsement" than to actually provide guidance. A venture I was interim co-ceo of had such an advisory board and running formal advisory board meetings was a really big pain in that when we actually "put them to work" in asking to weigh-in on a specific question or issue, it was almost impossible to get a unified answer. We found it better to hold quarterly events at our office which were meant to be much more social and produced some interesting conversations than formal advisory meetings. For help advisory boards really should be no more than 3 and would advise having diverse experience but all highly relevant to the challenges you are and will be facing. I have a document I'm happy to share that spells out commitments at different levels. Just private message me your email and I can send it to you.

Having been in the position as an advisor, this is what I think an advisor expects: a. Equity Ownership. This depends upon how much involved an advisor into the start-up. b. A flat fee and a percentage pie on every transaction the stat-up makes(Not the profit margin) c. At my early stage, all I want is a testimonial from start-up n how I helped this business. In my early stages of adviosrship, I want good customer testimonials. This is a win-win situation for both of us. I get to learn from him many things which I couldn't have done myself. d. It is strategic importance to my own idea and I would love this company to scale and raise the funding and in this case I would expect a contract from the company which I helped.

The point of advising is to have fun but it's also to align with the upside of the business. So the things to consider / ensure are. - Are they venture backeable ... if they don't plan (or you don't see them being able to) raise venture capital, then being a formal advisor (with equity) won't matter. - Do you trust them. As an advisor, you're extended your brand and credibility to the team so you need to ensure they'll be good stewards of it. - Are they coacheable ... when you talk, do they listen and are open to the advice. Do they take action? As for compensation & commitment, here's what's normal. - 0.1-1% equity in the early stages .. usually over 2 years vesting monthly. - You make yourself available for 1-2 hour per month, and help throughout making introductions, reviewing documents,etc Personally, I think it's super important to ensure you tell what you won't be doing. Ex: I won't be accountable for a work product, as in - I'm not going to run your marketing / development team :) You never know what people expect, so it's best to discuss it upfront. Also, if you plan on doing formal advisory (for compensation) - it's ideal to get atleast 10+ companies to help out in that format to ever see a financial return ... your essentially acting much like a VC. So just understand, there's a very high likely hood that it won't go anywhere financially .. but it can be super rewarding. The key is that you enjoy spending time with the team and learning about their journey.