Zebraheard

Helping entrepreneurs turn ideas into a business

Entrepreneur Board of Advisors – Yes or No?


The question you should pose is not whether you should have a board of advisors but who should be on the board of advisors. Small business owners fail for a variety of reasons. Not knowing your competencies and poor planning are two of those reasons. Small business owners have a passion and a drive for their products or services, but may lack the skills in a critical area of success such as marketing, financial planning or networking. It is crucial for any business owner to surround their business with a diverse group of advisors. Some small business owners are wary of trade secrets escaping for the benefit of some other person or company. It is vital that the selected advisors are trusted business partners that are thoroughly vetted. The function of the group of advisors is to act as a strong sounding board, pointing you in the right direction and allowing you to focus on your core competencies while making you plan for the future success of your business.     

Business Advisors

Advisors

 

Your group of advisors does need to be a formal board of advisors. There are benefits to formalizing a board such as fiduciary duties to the small business and structured efficient meetings. Drawbacks to formalizing include a lessened ability to change directions when the market dictates the need for a change and advisory pay considerations. Formalizing the board of advisors has to be an individual choice and has to fit the attitude and the environment of your small business.    

One last point needs to be made.  Don’t choose people because they are or have been CEO’s of Fortune 500 or 100 companies.  Unless they grew that business from its inception they are probably as knowledgeable as you on how to run a start-up.  Find successful entrepreneurs to put on your board. Use the CEO’s, if you must, as funding sources but don’t rely on them for sound advice on running your business.  

Three Additional Points

Advertisements

April 29, 2010 - Posted by | Entrepreneur | , , , , ,

No comments yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: