A-List Startup Advisors
“Don’t expect your investors or advisors to have the answers to all of your big questions. They might know the basic stuff off the top of their head, or know who to introduce you to, but on the big decisive stuff tell them instead that it’s their job to be a sparring partner… Define your relationship this way: You’ll tell them what you’re thinking or planning to do, and their job is to back you into a corner and make you fight your way out.
When you set things up this way, your advisor has to spend less time learning everything about your company — a tall order when they’re probably working with several — and you end up honing and strengthening your own arguments. The marginal change that occurs when a founder has to defend or explain their position is where the real value is created…
The entrepreneur often already has the best answer. A good advisor will bring it out by forcing them to walk through the problem again and again…”
This advice is from First Round Review … a site that compiles expert thought on building startups, and it sets the stage for a list of tips on how to be an Optimal Startup Advisor.
Before we get to specifics, we want to build on the thoughts above. The term Advisor is a bit misleading. Startups need sound advice for sure. But more than advice, they need do’ers not just sayers.
One of the most seasoned AngelMD advisors once put it this way: “Startups need pigs not chickens. The difference? Chickens lay an egg and live to see another day. Pigs are committed. They are dinner.”
The Advisor was addressing the fact that lots of Advisors circulate around startups dropping wisdom then return to the comfort of the golf course leaving the startup to act. The advisor in this situation usually has little to no skin in the game. If things don’t work out, that’s the way it goes.
This formula doesn’t work for startups. They need a small group committed to the mission. This doesn’t mean every Advisor has to have their financial livelihood tied to the venture, but it means those working on the venture have to have mind-share in the deal. If they don’t, they should move on. They are wasting their time and the startup’s time and equity. The point can never be to linger in the startup’s orbit so that if by chance the startup “makes it” there is a ring of people who “got in at the ground floor.”
The math is against every startup. Everyone needs to be cognizant of this reality. In order to bend the risk profile in the startup’s favor, it has to have substantive contributions by its entire team. Obviously the amount of time and work is going to vary. The equation here is less about time and more about effort and commitment.
Here are a list of things a clinician can do to be an A-list Advisor:
1. Get to know the startup’s product well then provide feedback as requested.
2. Introduce peers who may have alternative perspectives and who may have access to useful introductions not in your Rolodex.
3. Make introductions to Industry executives in your Rolodex who may be strategic. Remember, 95%+ of all successful startups will end up getting acquired by Industry.
4. Post, Like, Comment and Share on social media to help establish the thought leadership of the startup.
5. Offer to record video testimonials for use on the startup website.
6. Conduct talks for the startup at conferences or events or mention them in talks you are giving for other purposes.
These are just a few of the many things you can do to be of great value to your client. Finally, here is a litmus test as to whether an Advisor is committed: “Is she thinking about the challenges of the startup, or working on their behalf, even when no one is looking.”
Members of AngelMD who have taken any of the Advisory Courses on AngelMD Academy are given a copy of our A-List Advisor Punch list which is not published anywhere else. You can learn more about the courses at: AngelMD Academy