It seemed like an advisor wanted to take over the business

Andrew has always been my advisor and friend. He had a long career in business and retired three years ago. He seemed to enjoy helping us and always had good advice. He was on the board of several companies and also travelled a lot. But, one day he said he would like to be more involved in the business. He had some free time and wanted to help us.

Andrew started coming into the office three days a week. He spent a lot of time to talking to everyone and began to get involved in day-to-day decision-making. He wanted a desk in the office. He had business cards printed showing him as an Advisor to our business.

One day Andrew sat down and said he wanted to join the Board. What he said that day and the way that he said it scared me. He seemed to me he wanted to run the business, to take it over.

I talked to other people in the team and they said Andrew was questioning my ability to run the business. He was inserting himself in the day-to-day operations. Everyone said they felt uncomfortable around him. Some said he was just bored and wanted to get back into the action. Rather that offering Andrew a Board seat, I asked him not to come into the company any more. We appreciated his contribution but we were growing up. Andrew was shocked and very angry. He walked out the door and I never saw him again.

Should I wait to make my advisory board until I can attract more accomplished people?

I wanted to appoint an Advisory Board. I thought it would be great to make introductions and provide us with advice. I thought one of my professors would be helpful but I didn’t know who else to ask. I talked with my brother who suggested that I write down the type of advice I needed and then find the right people. I followed his advice and thought I needed at least four people- finance, strategy, retail/wholesale, and government relations.

We are a startup and when I approached well known people in each area, they said they didn’t have enough time but they liked the idea and I could contact them in the future to keep them updated. I took this as code for we aren’t big or exciting enough for now.

I followed up with others who said they would be happy to help but they had limited contacts and access. I realized if I appointed them now, there wouldn’t be room for the people I really wanted in the future. Should I delay appointing an Advisory Board?

What's the difference between a Board of Directors and an Advisory Board?

I know that most start ups have a Board of Directors and an Advisory Board. Here are my questions:

What’s the difference between a Board of Directors and an Advisory Board?

What authority does the Advisory Board have?

How often should each board meet?

How many members should each board have?

Who should I ask to be on them? Should I ask friends?

How do I get people I admire but don’t know well to join?

How do I compensate people?