The word "advisory board" conjures images of boardrooms full of venture capitalists. In practice, an advisory board for a small business is something simpler and more useful: a small group of experienced people who meet with you periodically, give you honest feedback, and open doors you cannot open alone.
What Advisors Actually Do
Good advisors do three things: they give you perspective you cannot get from inside your business, they make introductions you could not make yourself, and they ask questions that surface assumptions you did not know you were making. Bad advisors take equity for brunch meetings and emails that go unanswered. Choose carefully.
Structuring the Relationship
A small advisory arrangement—0.1% to 0.25% of equity vesting over two years, or a modest cash retainer—is reasonable for an advisor who is genuinely helpful. Be clear about what you expect: how often you will meet, what kinds of help you are looking for, and what success looks like for both parties.
Key Takeaways
- Advisors are most valuable for perspective, introductions, and uncomfortable questions.
- Structure the relationship clearly upfront—expected time, equity or retainer, and definition of success.
- Two or three great advisors beats a large advisory board full of people with competing agendas.
