Coaches
How angel investors benefit from asking questions about a founder's advisory team
The Team Behind the Team
“Tell me about your advisory team.”
We ask this question during (almost) every 1-hour screening call we run.
Why?
Because I deeply believe the team standing behind the team plays a fundamental role in a startup’s success or failure.
The Observer Express
Don’t have time to read the entire post right now? No worries, here are the main points:
Too many formal advisory team members = bad.
Advisors are very important. My experience has been that the good ones do 3 key things that make a massive impact:
Be present.
Be curious.
Be honest.
Asking a few questions to understand the engagement level of an advisory team member is a worthwhile exercise.
“Here is Our World-Class Team of 37 Advisors”
I’ve seen founders present this as a good thing.
It’s not.
An advisor is like a coach - they push and challenge a business leader in an area of their expertise. They’re not in the game, and that sideline perspective allows them to help the founder fine-tune their performance and maximize their chances at success.
I’m all for having a team of diverse advisors representing different backgrounds and speaking into different parts of the business. After all, Proverbs 11:14 says “For lack of guidance a nation falls, but victory is won through many advisers.” But there’s a point where that can go too far, and the voices stop being meaningful.
Having too many advisors suggests a wide and shallow approach. If you have 37 advisors, how engaged really, are each one of them?
Now, there are obviously exceptions, but generally, a pre-seed or seed-stage firm is best served by going deep with a few trusted partners who truly understand them, the problem they’re trying to solve, and where they need to grow. These coaches know enough and are involved enough to make a difference.
Here’s what I think a great advisor looks like.
3 Characteristics of a Great Advisor
PitchFact is a very young company - I’m about a year into my own journey as a founder. There are many who have spoken into our growth, but one person that stands out is Chris Curran. Here are the 3 things he has done that I have found to be the most impactful:
Be present.
He answers the phone. He responds to my posts. He’s made himself available to me, to our team, and is there to celebrate when things go well and (especially) when they don’t. Entrepreneurship is a lonely journey - knowing someone outside your direct team cares is deeply motivating.
Be curious.
“How’s it going?” I’ve received that exact text dozens of times. “What’s the story behind this? Have you seen that? What’s your plan for those?” Thoughtfully positioned questions like this have helped our team work through dozens of challenging situations.
Be honest.
The man has 30+ years of experience with world-class consulting firms, is an active angel investor, and is a professor of entrepreneurship at one of the most prestigious engineering schools in the country. His experience and perspective are insanely valuable, and you know what he does with it? He shares his honest thoughts with me. Constantly - whether I ask for it or not. That report sucked? He tells me. The strategy is too complex? Straightforward dialogue letting me know. I failed to take my own advice? He tells me to go read my own words and try again. Sometimes it is overwhelming, but it is always helpful and I hope he never slows down. I cannot tell you the number of times one of those ideas and pieces of feedback triggered a breakthrough in our work. His honesty has made me a better leader, made our company stronger, and forced us to grow.
Every founder needs a few people like Chris in their life.
So how do you identify the level of active coaching a founder is receiving?
It’s Pretty Simple: Ask
“Tell me about your advisory team.”
This is the starting point. From there, asking simple follow-up questions like “What do your interactions with x advisor look like?” or “Where do you feel like your advisory team has been most helpful?” make it straightforward to understand a founder’s relationship (or lack thereof) with any given advisor.
Why Should I Ask About Their Advisors?
Because if a founding team is small, or is attempting something highly specific, they definitely don’t have everything they are going to need to be successful. They’re going to need support. They could very well have all the raw ingredients - talent, motivation, capacity, hard work, etc. - to get the job done, but they simply lack experience and need a set of strong coaches to help them get there.
If a founder appears to have a weak or surface-level relationship with their advisors, that could be a yellow flag. If there is no advisory team, that could even be a red flag depending on the situation. On the flip side, if the founder appears to be in close contact with several relevant experts, that could be a major benefit to the company’s prospects.
Final Thoughts
Advisors, like great coaches, can mean the difference between victory and defeat. The best coaches make a massive impact by being present, curious, and honest with those they’re training. Next time you see an “advisory team” slide pop up, consider asking a few extra questions about what those relationships actually look like.
What do you think?
Who have been some of your most influential advisors, whether formal or informal? What do you look for in a company’s advisory team?
Weekly Observations: 3 Lessons Learned
Defining the market size for a thing is really hard.🧮
This week I noticed a common thread applicable to several clients. Market sizing is very hard. We’ve gotten pretty good at this and are seeing lots of interest. If you know of good resources for leveling up market analysis or know of someone really good at this, let me know, I’d love to see our team continue exploring and growing in this area.
Getting people on the phone tends to reveal the real story. ☎️
I’ve recently been going back and forth with a prospective client for a few weeks regarding a “test drive” with one of our reports. We’ve rescheduled our meeting a few times since the ideal company for us to analyze hadn’t come up yet, but this week we just hopped on a call anyway to check-in. Wanna know what I learned? The real issue was less about the lack of opportunities to be researched and more about the fact that our “off-the-shelf” report didn’t quite fit the work he was looking for. Let’s just say it was a very productive phone call.
It’s not about the price. It’s about the problem. 🧩
It is very easy to get wrapped up in and overly focused on the price we charge for our services. It’s something I’ve personally allocated a lot of time, research, and head space towards. In any business, the price of a thing is important. But at the same time, it’s really not. For example, this week I had a conversation with a client that basically didn’t care what the price for our stuff was. All he cared about was that we could help solve his problem, and as long as our fee was “not ridiculous,” he didn’t care what it was. It was a good reminder to focus first and foremost on figuring out a way to consistently solve a hard problem that enough people face and are willing to pay something to fix. The rest will fall into place.
Thanks for reading, have a great week.
-Andrew