How to Choose Advisers For a Growing Startup; Early on, startup founders often struggle with a range of decisions regarding strategic moves and relationships. Basically, they need advice

How to Choose Advisers For a Growing Startup

Hyman Created Her Own ‘Personal Board’

THE ACCELERATORS

Updated March 27, 2014 12:16 a.m. ET

Early on, startup founders often struggle with a range of decisions regarding strategic moves and relationships. Basically, they need advice.

How does a new entrepreneur go about creating a board of advisers? And when should a startup build a board of directors with fiduciary duties and management oversight?

This week on The Accelerators, a blog on startups, experienced entrepreneurs and investors shared their tips for finding advisers, building a board of directors, and avoiding conflicts of interest among board members.

Jennifer Hyman, co-founder of New York-based Rent the Runway, explains why she built a “personal board” of advisers. Edited excerpts:

Soon after coming up with the idea for Rent the Runway [which rents designer dresses and accessories], my co-founder Jennifer Fleiss and I realized that we needed to build a network of advisers.

How did we find advisers? Initially we cold called or cold emailed people whom we respected.

To go from a cold call to having an adviser is a longer process. Early on I made the mistake of calling every successful entrepreneur or senior business person I met an “adviser.” It was partly true—Jenny and I learned so much from our meetings with founders and entrepreneurs from Quidsi, Netflix, Gilt Groupe and Kiva, among others.

However, not everyone who is helpful will or should be an adviser.

Now that I’m five years into Rent the Runway and four years post-launch, the individuals who have remained advisers are the people I connected with as friends. In reality, people tend to advise the entrepreneurs they like, and therefore want to succeed. I’ve built relationships with my advisers slowly over dinners, drinks and relaxed conversations that didn’t always end with a plea for help or a bullet-pointed list of follow-ups.

Today, I find that my closest advisers are actually other entrepreneurs who are close friends and about my age [of 33]. I call these people “my personal board.”

I’ve used the hundreds of entrepreneurship boondoggles (i.e. Goldman conference, SXSW, F.ounders) to find a handful of friends who I click with and trust implicitly. I find myself able to discuss issues and vulnerabilities that I have and get their take or at least listen to how they handled the same situation.

Being a CEO is insanely hard and often lonely, so finding a personal board that can help you be your best self and call you on your excuses is incredibly important.

The most unexpectedly rewarding thing I’ve found in creating a personal board is that I get to live the highs of entrepreneurship, not just via Rent the Runway, but through my friends’ successes. When you care about other entrepreneurs, you are genuinely happy for them when they raise an amazing round of funding at a great valuation, sell their company, have a baby or just come up with a brilliant idea.

I look forward to continuing to build Rent the Runway with the support of my personal board and know that with every new boondoggle comes a new opportunity to find an adviser.

 

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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