How To Leverage An Advisory Board To Accelerate Business Growth

By Kip Knight

Advisory boards can be a decisive competitive advantage for a company, but too often they fail to deliver on their potential. The typical life cycle of many advisory boards follows a familiar pattern:

• Initial excitement surrounding the creation of the board.
• Initial meetings discussing potential ways to help the company.
• Scheduling issues leading to a loss of momentum and interest.
• Disillusionment from senior management regarding the board’s value.

This common scenario begs the question: What can business leaders do to create a valuable long-term advisory board effectively?

Why have an advisory board

Advisory boards fill critical knowledge gaps within organizations, providing category expertise, sales leads, networking opportunities and insights into blind spots.

While a board of directors has legal obligations, advisory boards offer incremental value that can help you outperform competition in the long run.

Who should serve on an advisory board

Selecting the right members is crucial. Candidates must bring credibility, industry knowledge and the ability to provide valuable introductions to target customers. Chemistry with the CEO is also vital for effective collaboration.

Advisory board member compensation

Compensation varies but often includes equity incentives, performance bonuses and nonfinancial rewards such as event invitations. Clear agreements should be reached and periodically reviewed to ensure alignment and mutual benefit.

Launching a new advisory board

At the kickoff meeting, clarify the board’s role, responsibilities and expectations. Provide essential information about the company, competition and industry trends.

Encourage collaboration between advisory board members and senior management and, most importantly, establish a meeting schedule for the upcoming year to ensure ongoing engagement and progress.

Ensuring advisers make a positive impact

Active engagement is key. Regular check-ins with senior company leaders allow for valuable insights and feedback.

Stay informed about industry trends and provide up-to-date company information to advisory board members. Periodically evaluate the board’s contributions to ensure alignment with company goals.

Advisory boards offer a cost-effective way to gain valuable insights and maintain a competitive edge. By carefully selecting members, defining clear expectations and fostering active engagement, businesses can leverage advisory boards to accelerate growth and success.

Kip Knight is the operating partner at Thomvest Ventures. He is also a board member at Netbase-Quid and the founder of CMO Coaches, working with professionals who aspire to be world-class leaders.

Illustration: Dom Guzman

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• Source: https://news.crunchbase.com/business/advisory-board-leverage-growth-knight-thomvest/