The Incredible Value of an Outside Board

In the words of Clay Mathile, “If I had a popcorn stand on a corner in downtown Dayton, I would still have a board of advisors.”

If you missed the GCVA luncheon at the Cincinnati Contemporary Arts Center, you missed a great talk about the value of an outside board of advisors given by Joni Fedders of Aileron, a entrepreneurial resource and campus just outside of Dayton founded by Clay Mathile, former owner of The Iams Company.

A typical venture-backed company has a board of around 5 members that are mostly made up of investors, the CEO/founders, and maybe an industry expert. So, while these boards are critical to decision-making, they are not always objective because they are personally invested in the drivers and outcomes of the business. Investment decisions may require them to get out their checkbooks, HR decisions may require them to fire someone they like, and so on and so forth. Also, these boards are also not necessarily comprised of individuals with relevant experience. Venture firms are generally made up of some pretty sharp individuals (and I’m not just saying this because I work for a venture firm…), but they’re not all-knowing and they may lack the specific expertise that’s needed for a company to really succeed.An outside board of advisors is an objective group of hand-picked experts, seasoned executives, and well-connected individuals that can help the company set strategic goals and identify opportunities that may not be obvious to the less-objective and sometimes not as relevant board of directors. This objective, expert group becomes a powerhouse of ideas when they bring their marketing, financial, and strategic views together in a healthy debate focused on the success of your company.

So, before you even start booking appointments with VCs, get a board of advisors together first. You may have to pay for their expertise, but it’s probably the wisest investment your company can make. And the best part? It’s an incredible compliment to be asked to be a board advisor, so there’s no reason to be shy about asking the executives you most admire to be part of your board.