The Guide to Advisor Shares: Creating a Zettelkasten for Successful Advisor Relationships

The Guide to Advisor Shares: Creating a Zettelkasten for Successful Advisor Relationships

Introduction:
When it comes to building a successful company, having the right advisors can make all the difference. Just like you have a vesting schedule for yourself and your employees, it is crucial to have a vesting schedule for your advisors as well. In this guide, we will discuss the importance of advisor shares and how to establish a strong relationship with your advisors. Additionally, we will explore the concept of creating a Zettelkasten, a note-taking method that can improve your thinking and writing.

Choosing the Right Advisors:
Picking your advisors is similar to choosing a co-founder. They can either be critical to your success or a waste of time. Before promising equity, it is essential to ask potential advisors if they would be willing to invest in your company instead. This not only gives them more skin in the game but also sends a valuable signal to future investors. When considering an advisor, think about what you want in terms of their expertise and how they can help compensate for any weaknesses you may have.

Establishing the Advisor Relationship:
Once you have chosen the right advisor, it is crucial to establish a strong relationship. This can be done by putting together a signed agreement that outlines the advisor's domain of expertise, what they will help you with, and the percentage of equity or other compensation they will receive. It is vital to document this agreement, especially if equity is involved. Working with a lawyer and your potential advisor can ensure that the agreement works for everyone involved. Remember, as the founder, it is your responsibility to drive the cadence of communication and set expectations with your advisor.

Understanding Advisor Shares:
When it comes to issuing advisor shares, it is essential to have a clear understanding of the percentages involved. In 2019, companies that raised under $2 million typically issued advisor RSAs ranging from 0.2% to 1% of the company and advisor NSOs ranging from 0.1% to 0.5% of the company. The earlier an advisor joins a company, the higher the fully-diluted amount they will usually be granted. It is advisable to avoid a four-year vesting schedule for advisors, as most of their value is typically delivered upfront. Revisit the relationship after a year or two to determine if it is beneficial to continue.

The Power of a Zettelkasten:
In addition to establishing a strong advisor relationship, implementing a Zettelkasten can greatly improve your thinking and writing. A Zettelkasten is a note-taking method that allows you to interact with and communicate with your system of notes. By writing down your thoughts, you improve your ability to think coherently and stick to a point. Writing also aids in memorization and prevents hindsight bias, allowing you to retrieve thoughts exactly as they were initially written.

Creating an Effective Zettelkasten:
To create an effective Zettelkasten, avoid wasting time sorting your notes into categories. Instead, focus on storing interconnected notes and allowing for organic growth. The importance of a note is not solely determined by the topic but by the frequency with which you write about it. The more connections you make between your notes, the easier it will be to retrieve information and perform tasks effectively. Embrace the element of surprise by forgetting what you have stored in your Zettelkasten, allowing for unexpected discoveries during your search queries.

Actionable Advice:

1. Clarify your expectations: Before entering into an advisor relationship, clearly define what you expect from the advisor and communicate these expectations. This will ensure that both parties are aligned and working towards the same goals.

2. Regularly review the advisor relationship: Schedule regular check-ins with your advisor to assess the value they are providing and whether the relationship is still beneficial for both parties. Be open to re-evaluating the agreement and making adjustments if necessary.

3. Continuously update your Zettelkasten: Treat your Zettelkasten as a living system that grows and evolves with your thoughts and ideas. Regularly update and connect your notes to ensure maximum effectiveness in your thinking and writing processes.

Conclusion:
Establishing strong advisor relationships and implementing a Zettelkasten can greatly enhance your success as an entrepreneur. By carefully selecting advisors, documenting agreements, and fostering regular communication, you can leverage the expertise and support of advisors to drive your company forward. Additionally, by adopting a Zettelkasten note-taking method, you can improve your thinking, writing, and overall cognitive abilities. Remember to continuously evaluate and adjust both your advisor relationships and your Zettelkasten to ensure maximum effectiveness and growth.