Can a company pay an advisor via vested options if there is no plans to sell the company?

Approach it as if you were applying for a position in an organization. You will want to find the right industry, the right management team, the right opening on the board [either governance or advisory], the right person to help you. Next create a statement that says why you on this board. Then sell it.

Like anything to do with a startup, it's about proactive outreach. AngelList is a great way to research what people have done before. You want to optimize for relevant experience. AngelList however is very ineffective for making cold connections. Instead, I use LinkedIn and ensure to always write a personalized introduction with my connection request explaining why my company is something they would be interested in. After the connection is accepted, I then follow-up with a personalized email thanking them for accepting the request and then asking to buy them a coffee or schedule a meeting. I have built a great network of both formal and informal advisors and investors through this process. Formal advisors really should be limited to just a few. In these cases, granting options to purchase equity between 0.5 - 1% is standard for great advisors. But reimbursing expenses is far less standard. I'll always offer to pick-up the tab as a sign of respect for their time, but other than that, advisors (myself included) are generally happy to pay out-of-pocket unless for travel. Just like any relationship, be sure that you want to make a long-term commitment in equity before formalizing the relationship. Often, good advisors where there is a mutual chemistry will be happy to do many meetings without anything committed. Lastly, I would caution you to be wary of people who approach you to act as an advisor and/or people who are actively operational and also on many advisory boards. I limit myself to a handful of formal advisory relationships at a time and it's usually owing to a longstanding friendship that I am an advisor. You want your advisors that you're paying equity to to really be engaged. Happy to talk any of this with you in a call.

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.

Mark is correct that the best advisors should have skin in the game but that advice is applicable only when you and your business are obviously investable. I've engaged advisors at times when I knew I wasn't ready to ask for their money and I've often begun advisory relationships in the earliest of stages where I like in and believe in the entrepreneur and the idea but they don't yet meet my investment criteria. Also, the old adage is true: Ask for advice, and you might just end-up with the person offering or even asking to invest. This has happened to me again on both sides of the table. In terms of compensation, I have a chart that spells out specific advisor expectations and stage-appropriate equity based compensation that I can email anyone who DM's me here through Clarity. Mark's answer is lower than I would accept for a start-up that isn't well funded. But anything above 1% would be really unusual and would have to be a really, really hands-on advisor or partial contributor as a team member. It should never be money on a retainer basis. I now have several people who call me regularly through Clarity to talk through specific things but other than that, it wouldn't be reasonable to expect cash compensation in a formal advisory role. And I would personally be vary of that because if they're not taking equity, then they really, much to Mark's point, have any skin in the game. I have a standard template that I use as an advisor (it was originally given to me by a company I advise) and I know use it with my own advisors, so happy to pass a stripped version of that agreement as it's the best one I've seen and is clearest for both parties. Just DM here via Clarity if you want it.

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.