By Charles J. Curto, Managing Principal of Tech Coast Equity Group
The Technology Council recently presented a panel discussion on advisory boards, The Art of Building and Using an Effective Advisory Board. The panel was chaired by Feyzi Fatehi, CEO of Corent Technology. Wayne Pinnell, Managing Partner of Haskell & White, Mark Monaghan, Business Growth Specialist and Managing Principal of the Markus Group, Mark Nielsen, Chairman and Co-CEO of Text Power, and Peter Santora, Managing Director, Korn/Ferry International participated in the panel. Below are key take-aways from the panel discussion.
Nobody knows everything needed to make a business successful. Know what you (and your employees) know and especially what you don’t know. Use your advisory board as a low cost way to get advice on what you don’t know and need to know to reach your business goals. For technologist, this could be sales and marketing expertise to calibrate and augment that provided by their employees. It could be insights into the latest technology advances. It all depends on your needs.
- Pick members carefully. In addition to picking members who can fill gaps you have identified, strive for participants who want to be part of achieving your vision for your business. Conversely, avoid those who would feel an obligation to join just because you ask or are just looking for compensation.
- Draw members from a broad pool of candidates, including your customer base or target customer base, non-competing industry executives, professional service providers, industry luminaries and academics. Put differently, don’t surround yourself with people who know what you know or think like you think.
- Communicate your expectations to advisory board members. Have them communicate whether they can meet these expectations as well as whether they feel other expectations might be more appropriate.
- To get the most from your advisory board, meet regularly, both with individual members as well as with the board as a whole. Share what’s going on your organization and what your plans are. Let them know the problems you have other than the specific issues for which you may want to plumb their specialized expertise. Meeting regularly as a board will also permit the team to spark a dynamic that will open up valuable possibilities you won’t get from just one-on-one meetings.
- Compensate your advisory board members appropriately with cash, gifts and/or stock. Stock in the form of options or grants is an especially appropriate reward for those who help you achieve your vision and are instrumental in building the value of your company. However, the greatest form of ongoing compensation is listening to their advice and giving it serious consideration as well as giving them recognition for the contribution they are making to building your business
This summary is not meant to be a transcript of the session nor a comprehensive primmer on advisory boards. Instead, its intent is briefly to share a few of the valuable take-aways from the session, take-aways which are based on the experience of successful entrepreneurs and professionals who work with entrepreneurs. Hopefully, these snippets will encourage you to attend future Council programs where you can meet and learn from the experience and wisdom of other thought-leaders.