When should I formalize the relationship with an advisor?
There is no exact period of time to wait before you formalize the relationship with an advisor. It’s likely somehwere between the 3rd and 6th meeting, depending on how often frequently they are happening. Time is a precious commodity on both sides, so if you’ve gotten to know one another and want to continue to work together it’s a good idea to show that you value their time and contribution by aligning incentives.What if I want to be more specific about deliverables and milestones with an advisor?
You are more than welcome to include specific deliverables or milestones you and an advisor mutually agree to. These will differ for everyone, so rather than create something that’s not that helpful we suggest doing that in an appendixHow much equity should I give to an advisor?
There isn’t a strict rule but here’s a guideline based on both your company stage and the advisor’s level of experience.
|Advisor Experience||Idea/pre-launch||Seed||Series A||Series B+|
|First/second time advisor||.2 - .5%||.1 - .4%||.1 - .25%||.1 - .25%|
|Fairly experienced||.2 - .5%||.25 - .4%||.1 - .3%||.1 - .3%|
|Known Entity||.5 - 1%||.4 - 1%||.2 - .5%||.1 - .4%|
Advisors, the way we’re defining them, are individuals that are able to give strategic advice based on experience as entrepreneurs, executives and/or deep expertise in a certain area. Your incentives should be aligned around growing the company and equity is the best way to do this. There is nothing wrong with project-based on hourly consultants, but FD:Advisors and this agreement does not serve them well.
If you have feedback or ideas about the Advisor Agreement Templates we’d love to hear it: firstname.lastname@example.org
FounderDating does not assume any responsibility for any consequence of using the form Advisor Agreement. This document has been prepared for informational purposes and is not intended to (a) constitute legal advice (b) create an attorney-client relationship or (c) be advertising or a solicitation of any type. Each situation is highly fact specific and requires a knowledge of both state and federal laws and therefore any party should seek legal advice from a licensed attorney in the relevant jurisdictions. FounderDating expressly disclaims any and all liability with respect to actions or omissions based on the form Advisor Agreement.