At KEVOS, we believe in sharing valuable knowledge to help businesses thrive. One such strategy that can significantly accelerate your company's growth and efficiency is setting up an advisory board. Advisory boards offer a powerful way to tap into industry expertise, saving both time and money, and providing strategic insights that drive success.

After this, you'll have the tools to establish an advisory board tailored to your business and start scaling quickly.

What is an Advisory Board?

An advisory board is an informal group of professionals who provide you with guidance and advice, unlike a board of directors, who are formal members with voting rights and decision-making powers within the company.

The key difference is that a board of directors is usually involved in governance and decision-making, often having equity stakes in the company. Advisory boards, on the other hand, don’t necessarily require members to hold shares or have legal authority in your business. They simply provide expertise in crucial areas like legal, marketing, finance, and HR, without the formal responsibilities of directors.

If you're a young entrepreneur, you can't expect to excel in all areas of your business. Advisory boards bring in top-tier experts who can steer you away from the mistakes they made in their own careers, helping you build value rather than wasting resources.

Pro Tip: Your advisory board won’t make operational decisions—they provide insight that allows you, the CEO, to steer your company more effectively.

Understanding the Value: Numbers Don’t Lie

Let’s break it down: Imagine you bring five industry experts onto your advisory board, each with around 15 years of experience. You now have access to a cumulative 75 years of expertise—by investing just AUD 5,000 to AUD 10,000. This is a small investment compared to the immense value of experienced insights they can provide.

Key Benefits of an Advisory Board

Every business requires support in various domains like legal, finance, marketing, operations, and HR. You can either hire department heads or rely on an advisory board to guide those teams. Advisory boards play a critical role in keeping your team focused on the right goals without the heavy costs of full-time executives.

A standard advisory board may include experts in:

1. Legal

2. Finance

3. Marketing

4. Human Resources

5. Product Development

6. Accounting

These individuals can guide you through complex business decisions and strategies, helping you avoid costly mistakes.

How to Build an Advisory Board: A Framework

1. Mandate
   Decide why you need an advisory board. Do you want to raise funds, scale faster, or improve a particular business function? Clarify your goals before assembling your advisory team.

2. Focus
   The CEO or Managing Director must set the focus areas for the advisory board, defining what you want to achieve over time. This ensures accountability and measurable progress.

3. Size
   While six members cover the key functional areas, keep the size manageable to avoid ego clashes and conflicting opinions. A well-balanced board should have complementary skill sets and personalities.

4. Meeting Frequency
   Hold monthly meetings of at least two hours, either in person or virtually. These sessions should be goal-focused, reviewing previous milestones and setting new ones to track progress.

5. Terms
   Set clear terms and expectations in a contract, including time commitments, non-disclosure agreements, and exclusivity clauses to protect your business interests.

6. Compensation
   While some companies pay cash, others offer stock options or a mix of both. Advisors want to see value for their time, and stock options can incentivize them to help grow your business.

Leverage Expertise and Networks

The true value of an advisory board is not just in their advice but in their networks. For example, if you're raising AUD 10 million, having a finance advisor who has already raised that kind of money can introduce you to the right investors. Leverage their networks to bring in customers, top employees, or new funding opportunities.

Remember: Advisory boards succeed when you hold them accountable for meeting specific goals, just like any team you manage.

Avoiding Failure

Advisory boards can fail when progress isn’t tracked. After each meeting, evaluate whether the set goals have been achieved and establish new targets for the following month. This keeps everyone focused and ensures your company continues to grow at a rapid pace.

Strong advisory boards have become one of the reasons startups today can scale so quickly. They aren’t just there to offer advice; they help create access, build networks, and open doors to new opportunities.

Final Thoughts

When creating an advisory board, the real value comes not from having experienced professionals but from leveraging their expertise with clear goals, regular progress checks, and a focused strategy. Make the most of this powerful business tool, and it will help propel your company forward.

At KEVOS, we understand the importance of expert guidance in turning engineering visions into reality. Just as we help shape ideas into detailed, precise designs, an advisory board can help guide your business to new heights.