There are three levels of maturity that affect equity compensation: idea, start-up or growth. There are also three levels of commitment for a consultant that also influence compensation: standard, strategic or expert. For example, if a consultant offers assistance to a start-up start-up by meeting with the team each month, recruiting talent and answering a customer call, that consultant earns 1% of the business in the form of shares or limited options awarded over a two-year period; offsetting a similar commitment to a growing business of only 0.6%. The FAST capital compensation framework is shown below and the full agreement, which explains everything, follows. During the company`s activity, the company reimburses the advisor for reasonable travel expenses. The consultant agreement should provide details on how this will work and the reimbursement limit. There should also be details on the time and method to inform them about expenses. 2. Compensation. In return for the services provided by the consultant and other obligations, the entity compensates the advisor with equity funds as defined in Schedule A, subject to a blocking plan defined in Appendix A and the agreement to grant or issue equity to the advisor. If you are interested in working with dozens of potential mentors and consultants to create your start-up, then you should apply for a Local Founder Institute program.
You can apply on the link below: consultants agree to be mentors to the company and advise them on the issues outlined in the agreement. What is expected of an advisor must be included in the agreement and discussed in detail with the employer. There should be an element of flexibility in the agreement, so that when the councillor is asked to do more work, there is some leeway to do it. But before you think about the number of stocks or options to issue an advisor, there are a number of points to hammer. What is the councillor`s role? Will it give marketing insights or instructions at the board level? How long is it expected of her each month and how long? What does she pay? Defining these points will help determine the right amount of justice that needs to be spent and that everyone is on the same side in terms of expectations and responsibilities. Some companies will even create an advisory board; However, this is not considered a legal body. This is not necessary and purely optional. It is designed to improve the credibility and social evidence of the start-up. It is not mandatory to indicate this in the consultant agreement.
Recruiting an advisor for your business can significantly improve the way your business operates. External and objective advice can help your business achieve bigger things, faster by taking control of the advice of others. However, in a professional environment, it is in everyone`s interest to formalize the relationship so that everyone knows what is expected of them.