Should the coach of your favorite college team develop and implement the game plan for this week’s big game against their rival without discussing the options with his offensive and defensive coordinators?
Or without checking with the team doctor on the health of the players or the scout on the capabilities, tendencies, strengths and weaknesses of their rival? Should the CEO of a Fortune 500 Company agree to and execute documents related to the acquisition of another company without discussions with his Executive Team, Board and Professional Advisors such as attorneys and CPAs? No, they should not. The advice, counsel and support of and advisory board consisting of multiple partners is required to accomplish substantive objectives.
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While in our modern world, information is readily available to almost everyone via the internet, the time to data-mine the specific information pertinent to the issues at hand can still be daunting. Additionally, obtaining direct support from trusted partners with related experience can prove even more valuable.
Here are 7 reasons you need a solid Advisory Board:
Fresh Set of Eyes / Sounding Board
Carefully selected advisors can provide an alternative view of issues because they see them through a different set of lenses, a differing environment and experience base. More importantly though, if selected on an independent basis, such advisors will provide the unvarnished truth, challenging the entrepreneur’s perspective, even if it is not what the entrepreneur desires to hear.
Advice and Counsel
The technical entrepreneur/inventor may clearly have the intellectual firepower to address and successfully tackle a vast array of issues. However, advisors can bring different backgrounds, educations, skill-sets with relevant direct experience to the party immediately. In a world where “time is money” and ideas have shorter and shorter “shelf-lives,” would it be more efficient for the entrepreneur to focus on their specialty, the development of the product, or to research how an accounting transaction should be booked, how a complex regulatory issue should be handled or the intricacies of social media in order to develop and support their personal marketing skills?
Focused, Unbiased Input
Assuming a diverse advisory board has been established, the advisors should be able to address most issues immediately, based on previous experience, focusing on the relevant and avoiding the proverbial “rabbit-trail”. Leveraging this experience allows the startup to rapidly scale without continually “re-inventing the wheel.” Challenging solutions to issues from differing angles on an unbiased basis permits the advisor to support the entrepreneur in developing better solutions, sooner!
Even the most diverse advisory board can’t provide expertise in all disciplines. However, they can and do possess contacts, know someone with the expertise and experience to help address the issue, assess the environment, solve the problem or influence key constituents.
Members of advisory boards bring experiences which have resulted from their building of careers and reputations as successful and accomplished leaders in their respective fields. These individuals are influential in their industries, communities and in the business world in general. Additionally, they know others with influence. Leveraging such influence is critical to rapid scalability.
Strong advisors won’t agree to serve unless they are comfortable the start-up and entrepreneur bring with them the potential to be “the real deal.” They will do their homework and it is unlikely they will participate as a member of the advisory board if they are uncomfortable with either. Through, this vetting of the company and entrepreneur, the potential advisory board member not only validates the effort for her/his self, but their affiliation provides credibility to the start-up and the entrepreneurs involved.
One of the most complex, confusing and time-consuming endeavors the entrepreneur faces is obtaining funding to scale their endeavor. While an advisor with experience in raising capital will not be able to guarantee to fund, they can radically improve the odds by mapping out a path which allows the entrepreneur to bypass obstacles and avoid pot-holes. Creating a strong advisory board of trusted members with diverse, successful backgrounds potentially stages the startup to accelerate its growth and enables the entrepreneurs to rapidly scale the opportunity.
Advisory Board Creation: What is the Single Most Important Factor?