An advisory board that is well-organized is a major asset to an organization particularly when its members are respected and recognized experts in their respective fields. A properly-formed advisory board can enhance the credibility of a business and help attract investors, potential partners, and opportunities for business development. As opposed to regular board members advisory boards do not take on the legal liability and risk of making decisions for the entity Their opinions and suggestions are more flexible.
Outside perspective
The expertise and knowledge of the members is the biggest advantage that an advisory board can bring to the table. They may also have access to information that is not available to the management team, which is helpful in identifying issues or addressing blindspots. Furthermore, since they are not tied to the day-to-day business of the company or legally responsible for its operations and decisions, they are more able to come up with creative ideas and solutions.
Professional Credentials
For advisors themselves being a member of an advisory board is a great way to round out their resumes with additional work experience that they can utilize in pursuing new job opportunities. Many advisors see their work as a means to increase their visibility and prestige as an “thought-leader,” which can be a valuable asset when it comes time to network and gain new job or partnership prospects in the near future. Although it’s not required, compensating your advisory board members with equity or stipends could be a great way to encourage them to devote their time and energy to your company.
