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Comment by foobarqux | Hacker News Reader

If the problem is really only guidance and outside input, wouldn't having advisors (no voting rights) solve the problem described in the essay without giving up any kind of control?

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Not really. Being on a board has a much higher level of commitment and "investment" than an outside advisor. It's also something of an internal position, board members get to see every wart, but lots of that information won't get communicated to outside advisors.

In theory, sure. The practical issue is that advisors often don't have as great an incentive to be highly engaged.

What is the incentive of a formal board member and why can't it be replicated with an advisor?

In the context of sama's post, the formal board member will have made a financial investment. That means that s/he has committed either his/her own money, or that of an LP; in a good board member, this creates alignment and engagement--since the board member wants the company to succeed for financial and reputational reasons.

Presumably the outside board members described by Sam Altman do not make a financial investment but, regardless, someone who has made an investment already has an incentive; they would be just an incentived with or without a board seat.

I'd encourage you to reread Sam's post. The whole premise is that the typical terms of a Series A investment no longer include a board seat by default for said investor. He does say that board members don't have to be investors, but that " it’s very important to get an advisor with a significant equity position that will play the role of a board member."

I did read the post, the argument is that startups aren't getting advice. I said that you don't necessarily need to give control (via board seats) to get advice. These advisors probably need some kind of incentive, likely significant equity, which makes investors a logical choice. They don't, however, need to have partial control over the company via board votes, unless the goal is something other than advice.

But advisors typically get equity. How much equity does a non-investor outside/independent board member typically get?

If it's similar then I think the question still stands: how do outside board members materially differ from advisors apart from voting power?

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