Just like having a quality set of investors can increase your company’s likelihood of success, having excellent advisors will help you navigate the complex landscape of growing and scaling a company.
The best advisors for your company will be experienced in your specific industry or your current stage of the business lifecycle and have the experience and insight to help you make informed decisions. They will also serve as an instrumental sounding board and help you identify potential opportunities and pitfalls and develop strategies to help you reach your goals.
Unlike your investors who make money when your company either goes public or is sold, advisors are not financially motivated by an exit because they are usually compensated like your employees — with an equity grant that has a set vesting schedule. Because their financial incentives are not dependent on the success of an exit, they may offer a different perspective than your investors that focuses on the long-term success of the company. Advisors and investors are both important members of your team, but serve different purposes. In this article, we’ve broken down the key differences between advisors and investors and the best places to find advisors for your company once you’re ready.
If you’ve determined that an advisor is right for you and your company, here are a couple of places you can look for one:
- Other Founders: Lean on other founders that are in similar industries and ask for their recommendations on good advisors. It’s also important that your advisors match the stage of your company so if you are a seed stage company consider asking founders of Series B or C companies whom they would recommend for someone at your stage. If you don’t have an established network of other founders, try joining an accelerator, local founder meetups, co-working spaces or even the Founder Institute. Talking with other founders can also help you narrow down the type of advisor that is best suited for you and your company.
- Your Investors: Venture capital investors have a wealth of insight and experience when it comes to starting a company. They have scaled numerous companies, and can help identify and connect you with advisors that have a successful track record of helping startups grow and scale. If you've already raised money, ask your investors who they would recommend as an advisor for your company.
- Social Media: Don’t be afraid of the cold outreach. You can find great advisors on LinkedIn and Twitter! Do your research and see who is a good fit for your industry. If you don’t have a direct connection, reach out and find a way to add value. Once you build a relationship, it’ll be easier for you to ask them to be your advisor.
- Angel Investors: Angel investors can help scale your company by providing capital, mentorship, and access to their network. Many angel investors are former founders and have first-hand experience in starting and growing companies. They understand the unique challenges of being a founder and can provide honest, unbiased feedback. Angel investors also have extensive networks that can open doors to potential customers and partners. Ultimately, angel investors can help you achieve your company’s goals quickly and efficiently. You can get access to lists of angel investors on sites like AngelList, Angel Investment Network, and Seedinvest.
- Your Network: Don’t discount your own network when thinking of who would be a great advisor for your company. Perhaps there is an old professor that would make a great advisor, someone you met at a conference, or even someone at your former company. Some of your best advisors may be from non-traditional spaces.