What is the best way to set up a board of advisers without having a large expense associated with it? How best to approach professionals to entice them to be on a board?
LYNDSAY SZYMANSKI, PUMPING STATION, LLC
First, critically assess your business needs. What are areas you could use input about? Determining your business needs will help you start thinking about the skills of people you want to engage.
The role of the board is to advise you about strategic directions your company might take based on your competencies and the competitive environment. It's an informal group with no direct authority over your business, but the perspective of outside or external members will be helpful.
The next step is to identify individuals you know who have the desired skills. Most boards of advisers start out small -- usually five or six members. You and one or two other members of company management should be invited, but members should be predominantly external to the company, allowing the management team to gain insight from experiences outside of day-to-day operations.
As you consider individuals for your board, pay attention to their need for compensation. What can you afford to pay? Most often boards of advisers are paid for their time at meetings, a nominal fee ranging from $200 to $1,000.
Don't be afraid to ask people to join. Many professionals would join a board of advisers just as a service to the community. The best way to approach potential members of your board is to simply ask. The first question usually asked is what is the time commitment, so be prepared with an answer.
Format for board meetings depends on how often you meet and the scope of your business. Meetings can last for three to four hours, or up to a day if needed.
A format that works quite well is to provide members with an agenda and the necessary background material for discussion at least a week before he meeting. A round table discussion is much more productive. Generally, starting with the most difficult or complex issue is more effective as it's far too easy to get caught up in smaller issues and leave larger topics unresolved.