Advisors, investors and board members come in all shapes and sizes. I'm a strong believer in having a board, even at a seed stage, to report to and set strategy with. The most successful companies have strong boards and so as a good housekeeping practice, why not start acting like a great company as early as possible.
Having a board and advisors is usually better than having none at all, but the following characters don't really provide the kind of value add you're looking for.
VC Blogger Fanboy
This geek reads all the blogs religiously and is a lean startup ninja. An avid retweeter, this person seems to know a lot about what the next big thing needs to be--open, free, mobile, and social. The only problem is that using Twitter or Craigslist as your primary case studies of how to build a startup is like standing in a cornfield trying to get struck by lightning on a clear day. Most successful businesses have a plan for real revenue right off the bat and a clearer value proposition than "let the community figure it out". Don't let the fanboys distract you from business 101.
On the other hand, having a 35 year veteran of the management consultant consulting industry doesn't mean automatic business success when your industry is being highly disrupted by technology this person doesn't even use. This is the kind of person who recommends you get a high priced CFO before you even have revenues, introduces you to lots of high level contacts at companies that aren't really even in your space, but kind of, and doesn't understand why you'd ever want to participate in that cool summer accelorator program because he thinks the economics are bad. Experience is good, but experience in this decade is even better.
Ask around for who the top entrepreneurs are and this is a name that always comes up--mostly because of the big name angel round they raised and the upward trajectory of the business they run. Seems like a good pick, except that every piece of advice given comes from their own experience--experience that is all during a a single up cycle. People learn a lot from failure, and this golden child has never ever failed in their vast four years of experience riding the escalator of the current bubble--so if the market turns or really tough decisions need to be made, this may not be my first phonecall.
The Powerpoint Celebrity
We've assembled the best team of advisors--a vertible who's who of who's who--except that we don't know any of them, and they don't really know us either. In fact, one of them just made an angel investment in one of our competitors because they forgot they were advising us and now I have to do damage control. Having them associated with your business is cool, and might get you into a pitch meeting, but if their actual relationship to you is vaporware, it's just going to set others up for a disappointment in the due diligence process. By the way, do you know who (surprisingly) *doesn't* fit into this catagory? Ashton Kutcher. I'm on the board of a yet to be announced investment that we have in common and this entrepreneur gets inbound calls from him. She said his interest was genuine and his questions about the business were thoughtful. Nice work, aplusk.
The Reluctant Partner
I can sometimes fit into this category myself and VC partners and angels seem to all have at least one deal like this . I really love a team, and I'm trying to help them out. I'm interested in their space, but they're kind of strugging to really get product market fit. I probably wind up spending more time with them then I should, but there's never been a real ask. The problem is that if you count such a person as an advisor, and you tell other people about who I've been helping you out a lot, it's pretty obvious that I haven't gotten my colleagues on board and decided to write a check. So, as good a recommendation as I can give, it's hard to talk around the fact that we're not in. It's fine to get some advice from a helpful investor, but you should be looking for that investor willing to put their money where their mouth is so their advice is aligned with your success and their vote of confidence in you is a strong one.
Want to hear more about getting the most out of your investors and advisors? Rob Hayes from First Round will be talking with Jason Goldberg, Founder of Fab.com on the investor/entrepreneur relationship at NYU tonight. Check it out.