Startup founders are strongly encouraged to find advisors. The theory being that advisors with deep expertise and networks can significantly increase a startup’s chances of success. Therefore, the theory goes, the valuable equity given to advisors is well worth it.
I have no doubt that good advisors can make a difference. However, most founders - especially first-time founders - are ill-equipped to judge the value of an advisor, and typically do very little diligence. Founders tend to rush towards advisors who work in the industry they are targeting, or “big names” that are well-known in Silicon Valley.
On the advisor side, there’s not much incentive to say no. Since the obligation is seen as minimal, there’s no real downside to taking the advisor stock options.
In reality, the advice you need as a founder changes over time, as you search for product-market fit, and then scale. Many advisors - chosen in the early days of a startup for their specific industry knowledge or access - have little value over the long journey of building a startup.
Over time, this can lead to resentment: founders gave up highly-valuable equity in return for open-ended, ambiguous, and low-value advisor relationships.
At Platform, we’re taking a different approach: rather than locking our companies into advisor relationships, we have the Platform Guild.
The Guild comprises a curated list of subject-matter experts in each of the disciplines, and each of the stages of growth, involved in building a startup.
This allows our companies to bring in just the right expertise, at just the right time.
In return, Guild members are remunerated with stock option "points" in a company, based on the actual time they spend helping the company.
We believe this yields a fairer, more efficient, and more focused advisor-founder relationship.