The process of selecting a team of business advisors for a start-up high tech venture is one of the most important tasks an entrepreneur can perform early on. Determining which advisors you use can make the difference between whether you get funded or not, whether you grow and prosper to the greatest potential, and whether you get sound, practical business advice. The most important advisors to a start-up firm are the Attorney and the CPA. In addition, you need to determine whether you need a board of advisors, a part-time CFO and/or business manager, or a sales and marketing coach to help you with the other aspects of the business. In order to understand the advantages and disadvantages of the different professional firms available, you should always interview at least three candidates for each slot. At the end of the process, you will have defined what you are looking for in an advisor and will have determined the needs of your business.

In my personal experience over the years having been interviewed by hundreds of entrepreneurs and high-tech clients, it is easy to spot those that are truly seeking an "advisor" versus those that are just seeking a compliance firm. The steps that you follow during the interview process will help you fine-tune your criteria.

This article explores methodologies to use during the process of selecting your advisory team. I refer to these steps as the "F.E.E.L Approach" (fit, experience and expertise, expectations, listen and learn) to selecting an advisor. If you use these steps when you interview a new service provider, you will begin to find out whether or not that person is for you.

Fit with your personality and that of your business is of utmost importance. Choose a firm that is compatible to your needs. A large, national CPA firm may be great for the aspiring I.P.O. firm with $15+ million in revenues, but may be wrong for the steady $2 million a year consulting firm. Also, make sure that you will have access to the people you meet on the sales call or the senior-most people, and that you will not get handed off to less experienced staff members. Lastly, make sure that the firm has all of the resources to handle your needs and grow with you. You don’t want to be the firm’s largest account and you sure don’t want to be their smallest either. Think big, you may not be doing business overseas now, but what about in 12 months?

Experience and more particularly Expertise in one’s industry seem to be of greater and greater importance today. Although areas of concentration are important, such as tax and auditing for the CPA or intellectual property for the attorney, there is even greater emphasis today on specialization in niche industries.

In selecting a CPA advisor for a technology firm, you need to make sure that they know the basics about your industry in general, not just software, hardware or the internet. They should know the difference between a phantom stock option plan versus an incentive stock option plan, how a foreign sales corporation would work in your situation, or whether that individual should be treated as an employee or a consultant. Even if the advisor does not understand the technology you have, he/she should understand the particular business issues you will be facing that are unique to your type of business. Inquire as to the advisors’ educational degrees, years of service in the hi-tech field, and types of clients served. Make sure there are firms compatible to yours in his/her portfolio of clients. Make sure you get a list of references for the clients that you consider similar to yourself. Ask about special projects they may have worked on recently for some of their clients and how they have helped their clients prosper. Find out whether the firm and/or the individual are known in the community. Are they active on the technology councils? Are they experts in your eyes? Do they know the "players" in the markets you play in?

Expectations need to be communicated from the beginning. Determine up front and then write down what you are looking for in an advisor and be prepared to precisely communicate that need during the interview process. Be knowledgeable of where your last service provider failed you, and let the potential advisor know what you are expecting in return. The fee for services to be provided should be discussed up front as well, so that there is a clear understanding between the parties. Know how often you should expect to have consultations or hear from them.

Lastly, make sure that the person sitting across the table from you is willing to Listen to you, hear your issues, and Learn your business from you. Being an advisor is not only that of teaching the client, but it also involves getting to know your business and the particular issues facing you, if value is to be added to the relationship. Make sure that the communication is very clear and you are comfortable together. Lastly, your advisors should get together with you periodically as a "team". It is always helpful to find professional firms that know each other and already have a working relationship going. This helps you reduce the amount of time you will ultimately need to act as a middleman.

The following list includes the typical services that a CPA or Attorney may provide to the start-up high tech company:

• Set-up or structure the business
• Ensure that the tax requirements, both here and abroad, that affect you are being followed
• Assistance with the business plan
• Assistance with creating projections
• Obtaining bank financing or angel or equity funding
• Selecting the correct accounting package
• Determining the key benchmarks for you to monitor the business
• Establishing a Board of Advisors
• Preparation of Financial Statements
• Corporate tax planning, projections, and tax preparations

• Incorporation/formation decisions
• Term sheets or preparation for IPO
• Employment contracts and issues, and intellectual property issues
• How much stock should be issued and what type of entity a company should be
• The problems and issues surrounding contracts
• Buy-sells between owners/shareholders
• Labor disputes

In summary, to ensure that the F.E.E.L. approach is successful you must take an active role in building your team of advisors. Your service providers must know you and fit into your company’s needs, as well as have the expertise to help you grow. They must also be truly committed to working together towards the specific goals of your business and your success in the business world.