Canadian Entrepreneur. Founder of Clarity - Angel Investor (33 companies). Co-Founder of Flowtown (Acquired 11'), Founder of Spheric Technologies (Acquired 08'), Mentor @ 500Startup, GrowLabs & theC100.org
The best way to build an MVP is to distill the solution to the smaller unit of value to deliver something to a customer.
Start small, time box it and focus on solving the problem at it's core even if it's ghetto (I call the best MVP's ghetto but useful).
Here's an image that represents my thinking on this
You should be so lucky that someone will steal your idea. The truth is that its all about execution and not ideas. Facebook wasn't the first social network, they just executed better. Same for Instagram, Yammer and Airbnb - all Billion dollar companies built in public.
If you're an accredited investor then I would suggest signing up for Angel List www.angel.co and invest in 10+ syndicates at $1K per deal so you can get a portfolio created.
This will give you diversity + doing it via syndicates you know other smart people are supporting the entrepreneur vs. just a bunch of "dumb" money in a deal.
The point of advising is to have fun but it's also to align with the upside of the business. So the things to consider / ensure are.
- Are they venture backeable ... if they don't plan (or you don't see them being able to) raise venture capital, then being a formal advisor (with equity) won't matter.
- Do you trust them. As an advisor, you're extended your brand and credibility to the team so you need to ensure they'll be good stewards of it.
- Are they coacheable ... when you talk, do they listen and are open to the advice. Do they take action?
As for compensation & commitment, here's what's normal.
- 0.1-1% equity in the early stages .. usually over 2 years vesting monthly.
- You make yourself available for 1-2 hour per month, and help throughout making introductions, reviewing documents,etc
Personally, I think it's super important to ensure you tell what you won't be doing. Ex: I won't be accountable for a work product, as in - I'm not going to run your marketing / development team :)
You never know what people expect, so it's best to discuss it upfront.
Also, if you plan on doing formal advisory (for compensation) - it's ideal to get atleast 10+ companies to help out in that format to ever see a financial return ... your essentially acting much like a VC.
So just understand, there's a very high likely hood that it won't go anywhere financially .. but it can be super rewarding.
The key is that you enjoy spending time with the team and learning about their journey.
I've had many "Advisors" over the years and I like to break them up into 2 groups.
1) Formal Advisors
These are people who strategic insights into the business and would create value for the company by having them listed on our site, and have access to them in an ongoing way. I typically engage them well before anything formal to see if they would actually be helpful and that we both get along.
Compensation is usually around 0.1% - 0.5% ... if the person is amazing and will also help with the fundraising process, then I would go as high as 1%.
2) Personal Advisors
These are people who I turn to for specific advice around tactics and strategy on an infrequent basis (maybe once or twice a year). Things like SEO, Internationalization, etc ... I typically try to create value for them every time we chat, so that it's win/win and I don't compensate with equity.
I've personally never paid for formal advice, although I do often via Clarity .. but that's different.
The great thing about Clarity is I can avoid spending the time or equity to get similar quality advice in usually a faster time period, however both approaches (list above vs. using Clarity) are totally different affinities to the person and the company.
Call if you need more.
I believe past history is a great predictor of future work, so I would ask
1) Have you worked with anyone in our industry or similar project?
2) Ask for their complete portfolio
3) Ask them how many full time vs. contractors
4) Ask them who on the team (or individual) did the work you like and if they would be available for your project?
5) Ask them to asses your idea and come back with 3 highlevel ideas via email or powerpoint.
If you're going to be spending $10K+ then I think it's fair to ask them to do a bit of work to demonstrate how they would approach your project.
My rule in life "I can't work with you, till I work with you".
Honestly there's too many to mention. Most successful founders are extremely kind and have a history of helping others... my quick list
- Dave McClurre
- Micah Baldwin
- Clay Hebert
- Mike McDerment
- Jon Bischke
- Gabe Luna
- David Hassel
- Mike Walsh
- Bill Clerico
- Hiten Shah
- Gerry Pond
- Sean Power
- Christine Lu
- Sally Ng
- Marc Nager
+ 100's more
Again, this is a quick list / not ranked in any order - just people who I think of personally that are kind and helpful in the startup space.
Here's my list of people who've actually built and scaled companies.
Todd Tzeng - Turn around artist of big and meaningful companies.
Cameron Herold - Built 1-800-GOT-JUNK from 5M -> 100M+ in 7 years.
Built and few a company to IPO and now works with growth oriented founders to help them
Ken Leblanc - Started and scaled propertyguys.com to 100's of franchises and category leader
As a 500 Startup mentor I would suggest the following
1) Blog about distribution, design and data. Those are the things that 500 values most and usually the fastest way to get on their radar.
2) Interact with @davemcclure (and all other partners) on Twitter
3) Attend geeks on a plane or other events they host.
It's all about relationships and perception, so create opportunities to increase the probability of showing them that you have skills that are relevant to the companies they invest in.
Hope that helps.