“But I was told I need to have a ____ to start a business.” Fill in the blank with a board of advisors, business plan, or some other obstruction between you and the thing you want to build. Have you noticed how all these commonly held notions about things you “have” to do are just excuses in disguise? They’re a reason for not doing something. They put a layer (or a lawyer) between you and getting something out there.
Board of advisors is a good one. Some people think they need one to get started with a business. But really, that’s just another excuse for not beginning. Why do you think everyone else knows how to run your business better than you? You know plenty — and what you don’t know you’ll learn as you go. Of course it can be a good idea to ask for advice and learn from other people’s experiences, but there’s no need to formalize it.
And notice who spreads these scare tactics about things you need and hoops you have to jump through. It’s the people who sell the hoops. That means publishers and authors of business books, business magazines, lawyers, and everyone else that makes a buck from showing you the “right” way. And don’t forget all the venture capitalists and established businesses who would like nothing better than to swoop in and tell you what to do for their own reasons.
Next time you hear that “you need this” or “you need that” to get your business off the ground, question it. Ask yourself: “Is this really necessary or can I get by without it for now?”
Scott Hurff
on 27 Feb 09Perfect timing on this one for us. We just launched and have been focused on execution and iteration—but there’s always that draw away from it to focus on intangibles such as the “board of advisers.” Will it help us sell more? Progress more? Get closer to our audience? Learn more?
Best answer: maybe.
So my rule is to focus on doing and it’s served us well so far.
Tarus Balog
on 27 Feb 09At OpenNMS our business plan has been changing for over five years. We did take the time to craft a mission statement:
Help Customers – Have Fun – Make Money
If you think all of the stuff people want you to do before starting a business is bad, try going to a Term Sheet for investment or acquisition. That’ll set your company back 6 months.
elfie C.
on 27 Feb 09thanks for this. you wouldn’t believe how big a morale booster, this post has been. i had been struggling for months trying to figure out why my business plan was so important to be refined, at such an early stage. the criticism i received was that, with the plan i had, i wouldn’t succeed. i didn’t know the numbers to anything. but how would i know without actually putting things out there? and experiment? even if i got quotes…
at the end of the day, theory and practice will always have a slight deviation between them.
i think it’s important to put your vision down on paper, so that you can always turn back to it if/when you sidetrack. but to set it in stone before anything even kicks off will just hold you back from really kicking off!
my methods, now, are to just do it. and find answers to your questions, as you come across them. advice will come. when you begin doing things, you’ll be surprised how open people are to give you an opinion on how to run your business.
Scott Miller
on 27 Feb 09couldn’t agree more on the excuses and tasks we create for ourselves that stops us from truly beginning.
good quote from Goethe on “beginning” and “commitment”
http://thebusinessofservice.org/?p=193
PM Hut
on 27 Feb 09I think the overhead of having a “board of advisers” should not be neglected. Such overhead can manifest itself in expenses, logistics, etc…
On the other hand, more opinions are always good…
Btw, is it adviser or advisor? I always thought it was with an “O” but my firefox spell checker changed it to adviser.
Jacob
on 27 Feb 09I’ve been asked many times by would-be entrepreneurs what they need to start their own business. I always tell them they need three things:
1. Something to sell 2. A way to deliver that something to customers 3. A way to receive money from those customers
That’s it. You don’t NEED a board of advisors, a documented “business plan,” incorporation papers, or any of that. All you need is the ability to sell product and receive payment.
It’s surprising how many of these people, once their excuses are removed, are suddenly no longer interested in starting a business.
Anonymous Coward
on 27 Feb 09This is good stuff. As always, apply common sense as needed.
Jeremiah
on 27 Feb 09Great post, but I will say that in my case my board of advisors has been invaluable.
But they don’t get paid. They don’t even regularly “meet” except online or individually – we’ve done a few lunches over the years – but they’re sounding boards, they’re connectors, they’re mentors, they keep things real and grounded, and have reached my business into national markets we never would of been in. But almost all of them I knew before I started my business.
You are right, though – you don’t need it. And most times the barriers are simply excuses – those of us in business for awhile have learned to just do it as opposed to lolly-gagging around with the what-ifs. Do some research, find something that people need, and provide it to them.
Jeroen
on 27 Feb 09I agree that it’s not NEEDED to start a business. But if you start something that needs a lot of capital to get going or you want go BIG, isn’t a business plan at the very least useful to know where you plan to go, and how you plan to get there?
Tim Jahn
on 27 Feb 09Agree completely. The ones who tell you all this crap is necessary are the ones who need to sell it to you.
As you say, there’s nothing wrong with seeking advice. But insisting on having all sorts of fluff before you can actually DO something is absurd. Stop fluffing and start doing!
Gary
on 27 Feb 09Interesting post and I don’t disagree. Though really – aren’t you doing the same thing. Selling your views and advice via your book, blog and products. It’s just a different view that other are selling….
Henrik Lied
on 27 Feb 09In Norway, you’re actually required to have a board to start your own business.
Bill Roberts
on 27 Feb 09Before starting my business, a board of advisors was one of the things I saw recommended in several books and articles. To create one artificially seemed strange to me – to look around for people to tell you what to do. Of course, if such a board arises organically from people you trust and respect, then great. But not having one is definitely not a reason to delay.
I think it comes from successful entrepreneurs writing books about their experience and assuming that what they did in creating their business is the only way. But of course there are many ways to build a successful company.
Nathan Kaiser
on 27 Feb 09Great post. Most startups engage in all the accoutrements of a large company way before they need to or it is necessary. While a startup should definitely get advice, feedback and counsel from others, there is certainly no requirement to create a formal structure for it.
If anything, it can be detrimental to a startup to do so. What if their business model or plan changes dramatically? Are the people that are on the board the right people?
Dave
on 27 Feb 09I think advisors (formal) are important when you’re trying to raise money, make high-level connections in an industry you’re not already in, etc.
Having an impressive advisory board builds credibility and in some cases, actually helps you get customers.
But your point about excuses is valid – no one should NOT start their business because they don’t have an advisory board yet.
David Minton
on 27 Feb 09While not a requirement to get started, I can’t say it would be bad to have one at some point. After eight years in business, I’m thinking we should get one. I don’t envision something too formal, but people we can go to for advise, and to tell us things we probably already know, but maybe not ready to accept.
Matt
on 27 Feb 09Since it’s tax time – I’m recognizing now how important it is to have a friend with a good rolodex. Creating a board of advisors might be an obstacle, but developing relationships with people who have done this before is smart. Even if it is to find the lawyers and accountants who are trustworthy and allow you to simplify and delegate the things which are not core to your product.
And let me just say now – I’m sorry to the folks who haven’t received their 1099 from me… it is in the mail.
John Gallagher
on 28 Feb 09Great advice. I think, as others have said, this needs to be tempered with some common sense – you need to think about what you need. If you need to go through the process of making a business plan to better form your ideas, it’s valuable.
But you’re right – in my current venture, I’m constantly looking for reasons not to continue and it’s easy to find “reasons” that are badly rationalised, just excuses not to take the risk.
“But surely no-one will buy it.” “But I’m going to have to draw on my savings to do it.” “But it might not work.”
In my case, the act of doing preparatory work such as market research actually eliminated some of my excuses. No-one would buy it? Well, what about these 15 people who’ve responded to me saying they would. What are they, just figments of my imagination?
Sometimes the stuff people say you need is not an excuse not to begin, but a way of eliminating the excuses.
Sean McCambridge
on 28 Feb 09I’m putting together a board of advisors for a new business idea because they’re going to be my stakeholders, not because they’re going to tell me how to build my business. I’m already working on that. What they can do is make sure I stay relevant. Not to mention this is a great way to start networking and have people “work” for you for free. That’s ten or twelve people already “invested” in my business by donating their time and expertise. Not all of us have the luxury of building a product exclusively for ourselves like Basecamp.
Josh Williams
on 28 Feb 09I’m a believer in the value of wise counsel. Wars have been lost because leaders did not surround themselves with the right advisors.
The key is to choose your counsel wisely. Having advisors for advisors’ sake leads to nothing but red tape.
Alamofire has three board members that include myself and two investors. They sit on the board because they have a financial interest in our success. And while they offer their feedback about what we’ve got going on, I run the company — and they know that. It helps that they’re not dumb money.
Additionally, the company has three independent advisors. One is a longtime friend. One is a mutual acquaintance. And one is a seasoned game-industry veteran who has become a close friend.
I’ve chosen to surround our company with these folks because they challenge us to dream bigger and they help us navigate foreign ground. Sometimes they even piss me off… which has the unusual knack of helping me defend, solidify and understand the reasoning behind decisions that I make.
You’ll notice something important though… Our board includes three people. And I have three outside advisors. It’s a small, select, competent group of people.
I listen to them, look for commonality in their advice, throw out the garbage, make decisions and move on. And we get shit done.
Kurt Trew
on 28 Feb 09Sound advice for anyone thinking about starting a business. I started a business once without even having an idea that I needed to do it. I was offered a large contract by an old friend who knew that I had an interest in a project that his company needed to do. Within a day of him asking me, I had set up a legal entity and accepted the contract. It was hard work getting things in place, but the only barrier to do so was my willingness to accept or decline his offer.
The rest of the business ‘planning’ came after, to get everything in place to complete the project.
Adam Landrum
on 01 Mar 09Rubbish.
Merge is in its eighth year, and we recently had our Board of Advisor meeting. Possibly some of the best advice I’ve ever gotten came out of that meeting.
Does a startup need one? Maybe not as much as a company in growth mode needs one—but I’m not sure how it could hurt. I count on my board to draw from their experience and their highly objective viewpoint.
I recommend a small and very informal board—and to meet not so frequently. Our recipe is three individuals who get treated to a fantastic dinner three times per year. The atmosphere is informal, fun but tremendously insightful.
I highly recommend a board to anyone who is serious about growing their business. Coincidentally, one of my favorite quotes>
“Wisdom is supreme; therefore get wisdom. Though it cost all you have, get understanding.”
Hmm. I’d say a Board of Advisors is a good idea, eh?
Nathan L. Walls
on 01 Mar 09My wife and I launched our business about a month ago after about six months of prep work. We decided to do the incorporation paperwork ourselves after meeting with one of our area’s big law firms’ partners. We found it wasn’t going to be a good fit. I’m sure the firm does fine work, but we were going to feel lost there and, at a sliding scale of $125 up to $350/hour depending on who was doing the work, not a comfortable expense when we could put that same money into product and advertising.
We met with two accountants. Again, the first wasn’t the right fit. The second, we’ll use when we need him.
We don’t have a board of advisors. We know the type of products we want to sell and we have more ideas than we have time. We know who to ask when we need advice. When those circumstances arise, we’ll ask. Really, for us, we don’t want to commit before we have to, not spend money needlessly and not establish any unnecessary structures. If there’s a good case for it, we’ll do it, but we’re very satisfied with how much we’re able to do ourselves.
I’m glad other posters find their boards of advisors beneficial. I don’t believe the point is to question whether or not they can be helpful, but to understand it should be a question of having one or not. It’s very easy to hear “get a lawyer, hire an accountant, get angel funding, don’t quit your day job, have $n in the bank before you start” that are, at best, generalizations to situations that might or might not resemble yours. If you’re accepting outside funding, your investors might make it a requirement, but again, that boils down to a decision you’ve made as the business owner. The key is owning and knowing the decisions you make for the business.
mj
on 01 Mar 09For me, the blank is “clue about the subject” and so I’ve started reading. It’s not that I just want to get into this area for the moolah or the novelty (I already have two niche businesses) but there’s something fun about it.
So, I’m reading online, watching videos, making plans to attend seminars from thought leaders and building an Amazon wishlist.
And soon, yes, soon, I will start.
Heatth Huffman
on 01 Mar 09So true…. In my case I was told I needed to create a business plan along with several other documents. The people that told me I needed all of this had MBAs and all worked for larger corporations as executives. I realize now that Web2.0 is about thinking ‘outside’ the box and breaking free of the old, inefficient and bureaucratic ways of doing things I learned from college. You don’t need to put up obstacles like this to get started – just dive in. If you love what your doing, you will figure it out as you go… but the important thing is to GO! Making a business plan for my business before I started would have been a complete wast of time anyway. I realize now how naive I was before I got some experience under my belt and the things I would have put in that plan would have been useless and obsolete.
Tom G
on 01 Mar 09I have several close freinds who are also excellent business advisors (finance and operations). We get together on a regular basis and discuss our businesses. I find that its very helpful to use experts as a sounding board as well as get a different perspective.
It doesn’t have to be formal, but not having trusted advisors when making decisions is a severe handicap.
Role playing to prepare for negociations of all kinds is very critical and these kind of people serve that function as well.
Tom G
on 01 Mar 09Not having a plan is a very bad idea; again the plan can be very simple.
If you fail to plan, (by default) you plan to fail (unless you are lucky or really do have a plan in mind).
Terry Sutton
on 02 Mar 09Excellent concept with the layer. There’s already so many layers between your fingers and the keyboard.
James Rissler
on 02 Mar 09Great article and surprising how many perceived needs we have in our mind for starting something.
I think good constant planning and a strong team is the two most important parts of starting a venture. As Adam pointed out having a couple reliable people you can run things by in the startup phase is tremendously helpful.
Over my first year I brought in two partners who were experts in areas I had little knowledge about. This was the best thing I ever did because doing the startup alone was always hard for me, lots of decision to make and having a solid team made the decisions better and easier to make.
Tom you brought up a good point too. Planning is always key to knowing where you want to go and how you are going to get there.
Damon
on 02 Mar 09All that stuff you “don’t need” is extremely helpful in getting a venture off the ground. You’re arguing over semantics. All you “need” is a folding table and a pitcher of lemonade. But you’ll do a lot better if you have some money, a lawyer, a couple co-founders, a good idea, some expertise, experience, and yes, a good board of advisors.
Martin Zwilling
on 02 Mar 09There are always two sides to every story (at least). I believe in advisory boards, especially if you expect to need outside investors. I summarized the relevant positives on http://blog.startupprofessionals.com/2009/01/every-startup-needs-advisory-board.html . Rather than slow things down, they will help get things done more quickly and effectively.
doane
on 05 Mar 09I couldn’t agree with your post more! Screw the “Inc Magazine Laundry List” of what you need to start and run a successful business. I got my venture off the ground just fine without a team of advisers.
This discussion is closed.