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Seven Key Reasons Why Advisors are Essential for Startups

Tim Hoerr, CEO & Managing Partner, Serra Ventures
Thursday, December 3, 2015
Tim Hoerr, CEO & Managing Partner, Serra Ventures
Headquartered in Illinois, Serra Ventures is a professional advisory firm that provides a broad spectrum of services to the middle market, mainly focusings on early stage & emerging high technology companies.

Startups are one of the hardest endeavors you'll ever engage in. Despite careful planning and execution, there is a significant amount of risk involved and ever-changing outside circumstances. Startups often comprise of young and sometimes inexperienced talent. While abundantly competent in a particular technical discipline, startup teams typically lack deep business experience. It's therefore important to seek sound counsel when tackling the challenge of entrepreneurship. Here are seven key reasons professional advisors are essential for startups.

Expertise: Perhaps the most obvious reason is that advisors bring strong expertise to the table. Entrepreneurs often engage professional advisors for their subject matter expertise in capital raising, accounting & finance, sales & marketing, operations and more. A key feature of many startup incubators & accelerators is an entrepreneur-in-residence program that facilitates the connection of startups with subject matter experts. Advisors also bring industry insight on the competitive landscape, advising you on how to best position your company in the market.

Experience: A close, yet distinct cousin of expertise. Professional advisors with several years under their belt bring valuable experience to the table. They have seen it all, so to speak - often in situations quite similar to those that young entrepreneurs find themselves in. Such experience can be invaluable in helping teams to avoid costly mistakes. Many advisors have been or still are entrepreneurs. so their perspective is unique and invaluable in helping you grapple with the tough challenges you'll face.

Connections: One of the most important reasons to take up with an advisor is for the connections he or she can help you make. The saying 'it is all about who you know' could not ring more true than in a startup setting. Advisors are typically very well-networked individuals - and the right advisor brings credibility to your company, opening doors that are otherwise closed. Advisors' connections can assist with business development, fundraising and specific problem solving. For example, getting the opportunity to pitch the right investors often hinges on a credible reference from an advisor. Likewise, an advisor can often make an introduction that leads to a valuable strategic partnership with a well established company.

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