(ps - we're a bootstrapped business, $2m turnover, doing OK)
Main concern - the advisory term lasts for 2 years - is that right to stipulate now? (he knows I'd love to sell in 3/4, so is this just a play for higher stakes later or normal?)
- no cliff (but we've had 4 good meetings - could settle for 3 months as working with another investor too)
2 yr vest (happy with this)
2 hours per month engagement (feel very tight, but he agrees this has some flexibility)
He has a lot of weight in the industry and some good advice so far - although most so far has just been around working together and business process, though v helpful. Think it's hard to tie down much more to agreement, but concerned that want someone 'in for the journey' not limiting timeframe / commitment so much - even at this stage.
Any thoughts would be hugely appreciated - thanks!
First make sure you are vetting your advisor as much as he/she is vetting you. I would have a personal conversation with other teams that the advisor has worked with in the past. Get to a level of granularity on what worked and what did not.
You don't disclose terms here which I appreciate but the percentages are important so I just want to make sure you aren't giving away too much.
By "alot of weight in the industry" do you mean that this person will make introductions for you to key customers, suppliers? Or are they well known and you think adding them as an advisor makes you look credible. If you are adding an advisor make it count. You need to identify three to four areas where you are not confident in your teams skills/knowledge about your business model and make sure that advisors added are addressing those very specific needs.
If this person is really good then you would want to spent a couple of hours with them every month. If you don't then you should ask yourself why you are taking on an advisor?
If you need a more detailed discussion let me know.
I have served as an advisor to well over 100 companies and have hired dozens of directors and advisors as a principal. Nothing of what you are saying is out of the ordinary. The most important thing is for you to understand what you want, exactly, from the advisor, and to communicate it to the advisor clearly. Im available if you still need any ideas or feedback. Good luck