Entrepreneurs generally look for a group of trusted advisors to help them become successful in the business world. Sometimes, these advisors will invest in the company or serve on the board of directors. Advice that you get may not always be in line with what you have in mind, but if you think about it most of it can help when it comes to long term goals and success.
When companies move through their life cycle, it is important to get valuable advice from various different sources. Some types of advisors will be better than others during different stages of your business. Here is a guide to help you.
Seed: When you first get started, you will find that your best advisors are actually your friends. You will want to talk to them early and often. Usually, your closest friends will offer you the most sound and honest advice. Just remember, not everyone has the mindset of an entrepreneur. Not everyone will be as comfortable with risk-taking as you are.
Incubator: When you are in the incubator stage of business, you will want to focus more on the background of your advisors. You will want to choose the mentors that have more to do with your industry. They will usually be successful and experienced entrepreneurs. Most of them will be able to give you great advice because they have been there before.
Round A Funding: Once you get to the investment stage, past the friends and family, you will want to look to angel investors to help give you sound advice. Angel investors can be great partners when you are starting your enterprise. Usually, they will have similar interests as you. You need to make sure that you have checked into their background and their references before you bring them on board.
Round B Funding: Once you have reached this stage, you are usually well on your way to being a market leader. The best advisors will be the other professionals in your industry. This may include attorneys, accountants, and other advisory firms.