In onboarding an advisor there are several key points to consider. First, a board advisor is not the exact same thing as a board director but rather acts more like a board observer. They are entitled to receive the same information as provided board members and like board observers, they have no voting rights. A contract should be setup for a formal advisory board member to include the following points:
The board advisor acts as a consultant and does not represent the company as does the CEO or the board of directors. The contract should determine the number and type of meetings (conference calls, group sessions, etc) and the preparation required for the meetings.
Advisors generally serve at the will of the CEO or the board but can also be setup for specific term of service. This makes it easier to transition into new and out of arrangements as the company grows.
The terms of compensation must be made clear as well as the handling of expenses. For equity compensation vesting schedules should be determined.
4. Information Rights
While the advisor has rights to the board notes, the advisor does not have the right to inspect the company’s books.
Confidentiality of information is a given.
6. Disclosing conflicts of interest
Conflicts of interest must be considered and disclosed as confidential information about the company will be provided to the advisor.
The advisor is typically indemnified by the company in the event of a lawsuit.
The advisor agreement should make clear the state of jurisdiction in the event of a dispute.
TEN Capital Network is proud to announce the launch of our Advisory Program which provides a roster of qualified advisors to assist in supporting your company in its growth plan. This includes increasing revenue traction, identifying the business model, and helping prepare the company for a fund raise.
This program is only available to those enrolled in the TEN Capital funding program.
If you want to find an advisor for your business, please contact us at firstname.lastname@example.org.