MBA2305 How To Create a Board of Advisors

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Foreign. Welcome to the Hundred Dollar MBA Show. Because a better business begins with you. That's why we deliver daily 10 minute business lessons for the real world. I'm your host, your coach, your teacher Omar Zenholm. I'm also the co founder of Webinar Ninja, an independent software company I started with my co founder back in 2014. And in today's lesson you'll learn how to build a Board of Advisors. This is a idea to help you and your business grow. Building a Board of Advisors for your business has so many benefits that we're going to discuss in today's episode. But more importantly, I'm going to show you how to start building your Board of advisors, how to compensate them, how to make sure you're getting the most out of your advisors to help you and your business grow. Listen, we can't be experts at everything, but we can surround ourselves with the right experts to make the right decisions as we move forward and scale our business. So let's get into it. Let's get down to business. This episode is sponsored by Time Doctor. Measure and improve your productivity wherever your people work. With accurate and employee friendly time and activity tracking, you can empower your staff to work from the office, home or anywhere else with total peace of mind. How do I know? Well, we've been using Time Doctor for the last six weeks or so and it's been a game changer for our business. We have real data to make real decisions to help our business get better, boost productivity and enable your teams to get better together. With Time Doctor in your tech stack. So why wait? Join over half a million happy customers and unlock the power of visibility, accountability and productivity with Time Doctor by starting a free trial today. Visit Time Doctor's website over at www.timedoctor.com to get started again. Timedoctor.com to get started with a free trial. Having a board of advisors for your business can help you shore up the areas you're not so great at. So one of the first things you need to do to build the board is list all the things you are good at, your superpowers, and then also list the areas you wish you had a little bit help with you don't feel so confident with. Maybe when it comes to those types of decisions, you need somebody to help you come to that decision, to make a decision that might be finance for you. Maybe it's sales, maybe it's pricing, maybe it's operations. Maybe you need a voice of the customer, somebody who's like a power user or an influencer in the space you serve. Just write down all the things you feel you need help with in your business and from there you can start thinking about people in your industry that you would love to be on your board that have these skills. Now, when you're first getting started, maybe you want to start with a board of three people and then you can always add later on. So narrow down your list to three people in three key areas that you can shore up in your business. Now, you're going to have to approach these people with some sort of offer. Now, before we talk about how to compensate your advisors, some options, let's talk about some of the benefits of even having these advisors in the first place. Number one, it's like I said, it helps you shore up your areas of weakness. You have some experts in areas you're not an expert at. This covers a lot of your blind spots in your business. Number two, this gives the public confidence when they see these experts are affiliated with your business, they this gives your customers confidence that, hey, these people believe in you and your business. This gives potential investors confidence, hey, their board are people that I recognize, people that are really good at what they do. They believe in this person and the business. That sounds great. That gives me that boost of confidence to invest in the business. It gives you confidence that you can do what you need to do to build this business knowing that you have this great board that has your back. And number three, it gives you accountability. When you have a board, you have to report to the board or you have to at least check in with them, you know, sync up with them. They're going to hold you accountable to the goals you guys set together. Each advisor, he or she will hold you accountable and say, hey, last time we met, you said you're going to do XYZ in these areas. Did you accomplish them? And for most of us, we need that accountability, especially from people we admire to keep growing and keep moving forward. So there's tons of benefits. On top of that. It adds value to your company in general because you have some ambassadors. It opens up your network as well. Meaning, let's say you need to hire for a position and you can call upon your advisors to, hey, share the job posting in their network. Maybe they know somebody that can help you out. Maybe they know a service that can help you out. You basically have people that can quote, unquote, work for you and your best interest. And lastly, it's really helpful to have a group of people to help you make tough decisions, pivotal decisions in your business instead of you just doing this all on your own. Now let's address the elephant in the room. You're like, okay, I'm going to approach this person. What am I going to compensate them with? Now, typically, many companies give some form of equity or equity equivalent to their advisors, and in exchange, you agree that they're going to help you in this way. You're going to meet X amount of times in the year they're going to be available in terms of sharing the Rolodex and their contacts and all that kind of stuff. You don't really need to offer that much equity because they are not an employee. They're not working at your company 24 7, but you want them invested, so to speak, so that you get their full support when you need it. I've seen founders give as low as 0.01% if the company's quite valuable. And I've seen people give 1%. I believe anything in this range is reasonable. If this advisor is like going to change the game for you, it's really going to help your business in a huge way in multiple ways, then maybe you want to be on the generous side, closer to the 1%. If you're not really sure and you just would like to have this person, their brain on board, half a percent is a good place to start. And again, ask yourself if you were approached to be on a board and they asked you to meet once every quarter and be available to help out when needed to maybe even support and promote your product from time to time. What would be worth it for you? Half a percent of a company that can eventually, if it's a unicorn company and worth a billion dollars, that's hundreds of thousands of dollars. Pretty sweet deal. So my overall advice when it comes to the compensation is do what's comfortable for you. You're comfortable giving up and start there, work around there. Don't give away equity that you just can't afford to give away or don't feel comfortable giving away. Next, you want to approach these people, hopefully you already know them. You have a contact or somebody can introduce you to them. Always try to get introduction. If you don't have a direct contact of somebody or you don't know them already. An introduction gives you credibility. It allows you to have a warm intro so that the person that you want to have them as your advisor feels like you're a legit person. You're not some random person that they don't know and just be honest with them. Say, hey, I'm forming my board of advisors for my company. This is my company. I'd love to have a chat with you to see if you might be interested in helping us in a somewhat limited capacity. Just let them know that there's not going to be a lot expected of them in terms of time commitment. We know that you're busy and all that kind of stuff. Can we schedule a 30 minute call sometime next week? That simple. I'm an advisor to a company and that's exactly what happened to me. I had a call, it made sense to me and I was happy to help. Also on that call, you have to realize you may not be happy with what you find out. You might not feel like they're a good fit. And that's okay. You could say, hey, I know I approached you, but I don't think this is going to be a great fit for us. Appreciate your time. That's okay. This is your business. This is your company. You need to do what's right by your company. This episode is sponsored by Time Doctor. Measure and improve productivity wherever your people work. We've been using Time Doctor for weeks now and it's been a huge game changer in our business. Let me tell you why. It's very hard to make decisions on workforce planning responsibilities and what's on everybody's plate if you don't have any data. And Time Doctor gave us the data we needed. We're able to now see how much time each person is spending on each project or task, as well as how much idle time our team members have in general as well as specifically to each department and employee. We now see our team as a resource. We say, hey, we have some gaps here that can be filled. Some people are doing enough work and some people have some free time and need to be challenged and we need to give them some projects, need some extra work, give them some things that can help improve the experience for our customers. Listen, you're paying your team anyway, right? So you might as well maximize their productivity, give them things to help them grow as a professional and help you grow your business by leveraging their time and effort to serving your customers. We made a few changes to our timetable, our shifts, our team, our responsibilities, our tasks based on the data that we saw and it's making a real difference in the experience and the numbers for our business in terms of revenue and churn. So why don't you join me and over half a million happy customers and unlock the power of visibility, accountability and productivity productivity with Time Doctor by starting a free trial today. Visit Time Doctor's website at www.timedoctor.com to get started again. That's timedoctor.com to get started with a free trial today.

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Gas, snacks, tolls this trip is draining my wallet.

Yeah, but we'll be with family.

You're in a good mood.

What's your deal?

What's my deal? I saved at Metro with no activation fees and I got one line of 5G for just $25 per month. Kept the phone I love and a 5 year price guarantee on my top.

Text and data detour to Metro.

Get that more for your money feeling only at Metro by T Mobile just.

Bring your number $30 first month and $25 after with autopay not available if with Metro or T Mobile in the past 180 days.

To wrap up today's episode, Having a board of advisors can really help you in so many ways. But most importantly, it frees you up to focus on your super strength. On your superpower. What you're really good at to help grow your business. You can always get a sanity check and see hey, am I moving in the right direction by talking to your board? Many board members are okay with having their phone number or WhatsApp access. We can send them a quick message and say, hey, I'm making a quick decision about this area of my business that's going to really affect our bottom line. What are your thoughts on this? And you can just send them a voice memo. Even having that ability to do that is well worth whatever you're going to compens them if it's reasonable, you know. So consider forming your board of advisors and take your business to the next level. Thanks so much for listening to the $100 MBA show. Make sure you hit follow on your favorite podcast app. Just hit those triple dots on whatever app you use. Spotify, Apple, Podcasts, Stitcher, Radio, Overcast, or on every single app. So go ahead and follow us so you get our next episode automatically and get access to over 2,300 episodes in our archives. Before I go, I want to leave you with this. No one builds anything special alone. We all have a team behind us. We all get help. We all have other people we can seek out to. If you want to get there faster, if you want to get there more efficiently, if you want to get there at all. There's safety in numbers. Do it with a team. Do it with some people that you can lean on when you need the most. Thanks so much for listening and I'll check you in tomorrow's episode Q and A Wednesday. I'll see you then. Take care.

Gas, snacks, tolls. This trip is draining my wallet.

Yeah, but we'll be with family.

You're in a good mood.

What's your deal?

What's my deal? I saved at Metro with no activation fees and I got one line of 5G for just $25 per month. Kept the phone I love and a 5 year price guarantee on my top.

Tuxt and data detour to Metro.

Get that more for your money feeling only at Metro by T Mobile just bring your number.

$30 first month at $25 after with autopay not available. If with Metro or T Mobile in the past 180 days.