There are three stages to consider when deciding to build your advisory board. 1.) Design your board. Considerations at this stage include: your current stage, the vision, mission, and current strategy of the venture, the areas of expertise that you would like to gain access to, annual calendar of meetings, mission of the advisory board expectations of advisors, board compensation, and etc. 2.) Establish your board. Considerations at this include: prepare legal documents from the advisory board charter to NDAs and indemnity agreements, identifying who you wish to pursue to invite and carrying out the invitation-interview processes, establishing an on boarding process that is well thought out and thorough to ensure you maximize the opportunity for parties. 3.) Facilitating the engagement of your board. Considerations at this stage are: honoring the annual calendar of meetings, being thoroughly prepared, disseminating information 1-2 weeks prior to each meeting, allowing the board members time to be prepared for each meeting, best practice to use a non-executive chair for facilitating the meetings, enabling the ceo/founder/leadership to be fully engaged in the meeting and not worried about running the meeting. Carrying out regular peer reviews of all advisors and leadership engaged with the board. Additionally it is important to cultivate relationship by being a great communicator sending out regular updates with the team and connecting with the advisors individually (and/or corporately). Looking forward to discussing further >>

The answers so far are a great representation that it varies across all types of companies. My recommendation is a range of $10,000 - $40,000 per advisor, per year (depending on board design, meeting freq, and advisor expectations. This may be translated to an equity participation (.25% - 3%/ea) or other deferred compensation method. Vesting is definitely a good design element. Several answers mentioned the possibility of advisor drift. It is important that your advisory board is well designed and well run to ensure that you are able to extract great value from the advisory team. One of the intangible forms of compensation is the advisors sense of giving and contributing value. When Advisory Boards are poorly designed and/or poorly managed communication breaks down, relationships weaken or never get started, and the advisor may not feel they are appreciated or that they are able to make a meaningful contribution to the venture. Your company's ability to cultivate those relationshipswith your advisors and create well prepared and engaging meetings will often be more important than a vesting schedule to the advisor's involvement. Nevertheless, always vest. Lets discuss your venture >>

Yes, there are a variety of ways to compensate advisors. - Vested options or warrants are one option. - Phantom stock - You can create convertible debenture with event triggers for payback such as funding events, revenue targets, and more. You have the flexibility to structure non cash compensation in a manner that works for the company and is still attractive to the adviser. Happy to answer further questions >>

Advisor compensation is variable. It is as variable as the different kinds of new ventures in existence. The company's strategic plans and their funding approach are important considerations. Consider that 99% of companies do not raise venture capital - popular media would have us believe it is the only way to build a company, and it is actually a very small number that go that route (by design or default). The fundamental considerations are the design of the advisory board, it's mission, goals, meeting schedules, lengths of term, caliber of the advisor and ultimately the companies expectations of its advisors. The compensation needs to be commensurate with those plans and expectations. Compensation considerations include: retainers, fees for each meeting attended, lodging and travel costs. Forms of compensation include: cash, options, warrants, phantom stock or value participation rights which may have a predefined payout with change of control or significant funding event or etc. And they may include a combination of any of these forms. Compensation value ranges from $2500 to $10,000 per quarter ($10,000 to $40,000 per year) and may be distributed with a mix of cash and equity forms. Cash is a scarce resource in most startups and therefore deferred compensation and/or equity become most popular or most heavily weighted in the mix. Side note: NACD publishes annual survey results of Board of Director (as opposed to advisory board) compensation packages. They are much higher, because of the fiduciary responsibility of serving on a BOD, that is not present in the advisory board. Still it helps serve as a benchmark of sorts. At the end of the day as an entrepreneur, CEO, or founder that is planning to establish an advisory board, you need to realize that you are seeking wisdom, network, time and resources from a person having some sort of domain expertise. What you really hope for, is to develop a long term relationship with that person and it all begins with a well thought out and well designed advisory board program. I'm happy to discuss further >>