Ask HN: How to compensate domain experts for advice, as a pre-seed startup? | Hacker News Reader

Ask HN: How to compensate domain experts for advice, as a pre-seed startup?

11 pointsdsubburam4 comments

I am a founder/CEO who is considering building support/features into our service for certain domains.

I have domain expert contacts that can help guide this, but I don't know how best to compensate them. Their contributions will be a call or meeting every week or two for a couple of months or so, as they guide me on the appropriate must-haves and pitfalls, and review the initial implementations of said features. Plus intermittent emails during the work week.

This is obviously too much of a lift to do as a "favor". But as a pre-seed startup, we can't afford their hourly market rates, and we aren't a full-blown C-corp to pay them in equity easily. Would mini-SAFEs be the answer? How would you compensate such advisors for their time and input?

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Would mini-SAFEs be the answer? How would you compensate such advisors for their time and input?

At the risk of sound glib... anything that all parties involved find acceptable (and within the limits of the law, of course) is good. There's not really a "stock" answer to this. Probably the best thing to do is talk to these people, explain the situation, and just ask "is there something I can offer you besides cash up front, for you help?"

Some possibilities:

a. equity. Even if you're not a C-corp, you can sign a contract stipulating that they get equity worth X dollar, conditional on some event (raising a round of funding, conversion to a C corp, Y dollars in sales, etc.

b. deferred payment. Eg, promise you'll pay them, in cash, at some point in the future. Basically they'd be loaning you the amount that they would charge for the service in question.

c. access to your product. If these people are themselves potential customers for the thing you're building, offer them usage of your product for free (or super cheap) in exchange for their help.

d. washing their car. Offer to come wash their cars once a week for the next year. Or whatever. The point here is just to emphasize that it can be anything really.

Thanks, this is useful.

d. can generalize (as you do say) into offering my expertise at something they're interested in (like, getting a Linux laptop); an expertise exchange as it were.

I've found that partnerships such as you describe work easily if you are actively building a solution to a current pain in their industry. They then are happy to help guide you, in exchange, perhaps, for discounted access when it launches.

If your helpers are not interested in such a deal, you might already be missing product/market fit, as anyone who will be willing to pay for your solution would certainly be willing to talk about it.

Advisors, 0.25-5% vesting after demonstrating engagement. Standard stuff.

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