When you are starting out in business, you will recognise that it can be a very lonely experience. You may have a couple of key people that are your ‘go to’ resource for advice. It is quite common for business owners to reach out to a former colleague, mentor, maybe a family member or even their accountant. However, there comes a time in every entrepreneurs business journey when they recognise that they need more than just casual advice. The formation of an advisory board with the right mix of skills, experience and talent is often critical to the long term success of the business venture.
I have practiced what I have preached over many years to start-up, early stage, SME and substantial private businesses. I have always surrounded myself with people who are smarter, wiser, better connected, have made mistakes so I could learn from them. I have invited the ‘best of the best’ to join me on my advisory board including two mega high profile recruitment industry icons. I have paid the most I could possibly afford to gain access to advisors who were prepared to share their insights with me, wealthy successful entrepreneurs who didn’t need the work, but were prepared to show me how I could grow a profitable business. In addition, I have also been very fortunate to have accessed high profile business executives who could help open doors for my business.
I cannot overstate how important my advisors have been to me over the years. My advisory board changes in mix from time to time depending on the venture and the challenges ahead, but there have been some advisors who I have worked with for more than a decade. They have opened doors, prevented significant and costly errors in judgment, kept me upbeat when I wanted to give it all away, helped me raise capital and I think most importantly throughout all of their collective wisdom and advice, they only ever had my best interests at heart. Even if that meant saying things that I didn’t want to hear on the day. They kept me accountable, keeping our business strategy and its execution on track. I have been truly blessed as I have had the dream team around me and I recommend to every business owner that they put in place their own amazing talented group of advisors. Below are my top tips when assembling an Advisory Board for your business.
1. Start with a small group of advisors, there is nothing wrong with working with only 1 or 2 advisors initially. You can add advisory board members as you grow and as your business requirements change. If an advisory board member is not adding value to your business, don’t be afraid to part ways. Start with a trial period to see how you work together and don’t commit to lengthy engagements. I have always been of the belief that you get what you pay for in life and you cannot expect top level advice to come for free, so set a budget for your advisory board and go about finding the very best talent you can afford.
2. Select at least one business advisor who is an entrepreneur who has successfully grown a business similar to yours. Accessing advice from a proven entrepreneur who can share insights into how to grow your business, review your business strategy and avoid mistakes will be critical to your success.
3. Specialist accountants and lawyers don’t always make the best advisors so look for someone who understands the numbers and business contracts, has broad commercial acumen and can assist in practical ways to help grow the business. Partner with your accounting firm to make sure you have monthly accounts prepared, this is critical to your dashboard of information which will underpin many of your business decisions.
4. Industry veterans and Captains of Industry are more accessible than you might think but they often will only engage if their involvement remains private. Don’t be afraid to reach out to business leaders if you believe that they can assist you, but don’t expect them to work for free. They are usually very busy and will only engage if they genuinely like you and the business. You must be respectful of their time and demonstrate a willingness to take their advice on board.
5. Gather a mixture of talent around you and identify skills and expertise areas where you are lacking, as your advisory board can help fill some of those gaps. A regular monthly meeting works well, as does one-on-one meetings with your advisors when you want to do a deep dive on business matters. There are no set rules here, you can make advisory board meetings as formal or as unstructured as you like, but regular meetings are important to build a successful relationship with your advisors.
For information about assembling a dream team Advisory Board, please contact Kylie Hammond for a no-obligation consultation via our websitewww.directorinstitute.com.au