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Good job on getting a product going! Having a solid advisory team that inspires you and motivates you through the ups and downs of a startup is very important.

Good job on getting a product going! Having a solid advisory team that inspires you and motivates you through the ups and downs of a startup is very important. This individual will hopefully help you stay focused along the way. A common custom would be to treat her as a strategic advisor, offering 0.1-1% equity, with vesting. Try to have some understanding of how much time they can commit to and on what frequency. An example doc is https://fi.co/fast https://fi.co/fast, but if you google for “startup advisor agreements” you’ll find a few similar standard docs.

ecesena 8y ago
I support the fi.co/fast, but I personally think it's a bit too in favor of the startup, and real world advisory agreements may require much less effort from the advisor. For example the 1% is at idea stage and requires 20h/mo = avg 1h/day, which is an insane amount. It's more realistic to have a consistent 30min call/mo, and maybe a few extra hours when the advisor is really needed, for example if you're brainstorming an idea, or executing on a launch. And maybe it's worth giving them a 0.5% even for this apparently small amount of time. That's also more realistic for you, because you want to be prepared to talk to your advisors, and having too many interactions is just too distracting. Vesting, I've seen it many time as 2y no cliff vs the classical 4y + 1y cliff for employees/founders. If you know the advisor already and she already provided value, you have no reason to require a cliff. Again, I support the fi.co/fast, and I'm not saying to not go with that as a start, mine are just negotiation points to close a good advisor. Finding good advisors is hard, they might have little time, and they may refuse the engagement if it seems too heavy from the get go.
- pushtheenvelope 8y ago
  I mentioned fi.co/fast as an example of an advisor agreement, rather than endorsing its exact recommendations. I should've been more clear on that. Many of the points you raise sound very reasonable. Thanks for sharing them!

ecesena 8y ago

I support the fi.co/fast, but I personally think it's a bit too in favor of the startup, and real world advisory agreements may require much less effort from the advisor. For example the 1% is at idea stage and requires 20h/mo = avg 1h/day, which is an insane amount. It's more realistic to have a consistent 30min call/mo, and maybe a few extra hours when the advisor is really needed, for example if you're brainstorming an idea, or executing on a launch. And maybe it's worth giving them a 0.5% even for this apparently small amount of time. That's also more realistic for you, because you want to be prepared to talk to your advisors, and having too many interactions is just too distracting. Vesting, I've seen it many time as 2y no cliff vs the classical 4y + 1y cliff for employees/founders. If you know the advisor already and she already provided value, you have no reason to require a cliff. Again, I support the fi.co/fast, and I'm not saying to not go with that as a start, mine are just negotiation points to close a good advisor. Finding good advisors is hard, they might have little time, and they may refuse the engagement if it seems too heavy from the get go.

pushtheenvelope 8y ago
I mentioned fi.co/fast as an example of an advisor agreement, rather than endorsing its exact recommendations. I should've been more clear on that. Many of the points you raise sound very reasonable. Thanks for sharing them!