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

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.

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.

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.

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.

A good advisor can help a startup in various ways. Here I describe what I do: I work quite a bit with pre-angel/pre-seed/pre-accelerator US-based tech startups (or sometimes even executives/scientists/technologists in corporate jobs toying with a startup idea that they'd consider leaving their jobs for), and have done this now for well over a decade while founding/growing my own companies. Most of these founders come to me from hearing about me from another founder, so I am assuming that founders are finding some value in their interactions with me. At this early-stage in the game, one of the key things I try to do is to separate founders' assumptions about various aspects of the business from facts that they have validated. Another thing founders find useful is examples/ideas of how other startups solved a similar business problem in a creative manner (my voracious reading helps a lot here.) Finally, I also try to take the devil's advocate position on key assertions that the founders make (e.g. why are they & their product uniquely suited to tackle this problem in face of competition) in order to point out counterarguments with the eventual goal of helping them strengthen their case. My engagements with founders tend to take the form of intense 30-75 minute brainstorming sessions (1-3 sessions), which typically provide them with enough food for thought to start executing on various fronts. A small percentage of these startups continue to make great progress over a period of 3-9 months and keep me in the loop via brief email updates. Those ones, I help by providing them critical feedback on their pitch decks (multiple iterations until I think that it is crisp and powerful) and then bring on the radars of my early-stage investor contacts (US-based).