Question: Does a Board of Advisors provide much value to a startup company? Would having a Board of Advisors have any impact, negative or positive, on angel or venture capital funding?
It’s a lame answer, but “it depends.” We’ve seen the effectiveness of these boards skew all over the map. We’ve seen some that are quite helpful with strategic direction, sales, marketing and business development and we’ve seen others that are simply faces on a website. If you go through the trouble of creating one, make sure they are really champions for your company and will be there to answer your calls. Sometimes the more of a luminary the advisor is, the less likely that they’ll have time to really impact your business.
As for an advisory board’s affect on attracting investment, it’s not really a factor. Clearly it’s not a negative if you have a board of relevant advisors, especially ones that have prior successes in a similar sector. That being said, most venture capitalists will choose a company based on the management team and the company itself, not on who has decided to take an advisory role.
My personal opinion is that if you have some high quality people who are willing to put in the time and who knocking on your door, you might want to consider creating an advisory board. I wouldn’t go out and spend much time looking to form one, however.