Advisors, Mentors, Governance

I’ve been asked to consider what sort of governance and/or advisor structure I plan to put in place. It’s a great question and one that, admittedly, I have not had sufficient time to ponder.

I start with a few beliefs.
- I strongly believe in surrounding myself with people that are much smarter than me. This does not generally just mean higher IQ score, but tends to reflect a certain area of expertise. This point was stressed by Guy Kawasaki in a presentation I attended today. (More ENGAGE! and Entrepreneur Week stuff.)
- I also believe that investors should have reasonable access to management (me) to discuss the business. Typically this happens at the annual meeting. In an entrepreneurial venture like this franchise, I believe this process should happen quarterly.
- I believe all stakeholders in the franchise should act in a way that is appropriate for their role in the business. Investors are not necessarily members of the Board of Directors. Nor are they managers. The Directors are not the General Manager. These roles must be kept separate and distinct, and not confused on a day-to-day basis.
- I believe my investors can form the nucleus of my advisor team.

A friend operates a clothing store in a small town outside of Kitchener-Waterloo. He truly understands customer service. He uses customer service as one of his key differentiators. I want him on board as an advisor, and an investor. Service absolutely must be one of our strongest differentiators. We are a membership driven business, and members must be serviced. This gentleman can help me.

I also believe that an entrepreneur can get too much advice or guidance, or advice from different sources that when all mixed together does not create a winning recipe. An entrepreneur must be strong and focused, and must be willing to disregard advice when it doesn’t feel right.

An entrepreneur will always be most passionate about executing his ideas, not the ideas/passions of others. If the entrepreneur surrenders the vision to his advisors, the company is doomed.

The key lies in striking a balance. An entrepreneur must surround his/herself with people that REALLY can add tremendous value. He/she must constantly ensure that everyone truly understands the current state of the business at any given point. He/she mustn’t deny the current state of the business. Understand it. Embrace it. Ensure all advisors understand it. Thus improving the quality of their advice.

An entrepreneur must also have a structure, systems and processes around interacting with advisors. Well defined, well planned quarterly meetings, along with quarterly updates and annual reports, may be the way to go.

Investors are not managers, and they do not get privileges beyond those described on their share certificate. They do not direct staff. I direct staff. They do not get free merchandise. No one gets free merchandise. They do not get to manage the business. I will manage the business.

I have much more work to do in this area. Something to get going on soon.

Another future blog topic, the three roles within a business.