1. Investors
Board of Directors
Tech Advisors Input Suppliers
Founding
Team
Biz Advisors Joint Developers
Outsource
Lawyers Partners
Distributors
Bankers
Lead Customers
Accountants
Beneficiaries
Headhunters

2. Early Stage Investors
You, Supported By Your Day Job
- Go for 4-5 founders; do not split equally; vest; someone with sales experience
Loving Parents and Friends
- Only what you could afford to lose at Vegas; never put a house on the line
1-3 Angels of Widely Varying Experience // Grants & Consulting
- Beware grouches! Look for long history of angel investing, ideally alongside VCs
- Take only government grants or consulting projects that go the right direction
Seed-Stage Fund or Bigger Angel Group
- Often a loan that converts at a discount to a prospective Series A
2-3 Top Tier VCs Invest $5M+ in Series A and Repeated Rounds

3. Five-Person Board of Directors
- Founder/CEO
- Professional Investor (great at fund-raising)
- Professional Investor (great at your industry)
- Experienced CEO who knows operations (*)
- One outside person who fills holes, knows customers, or
adds luster (*)
(*) Give 0.5-2.5% stock options depending on stage. Can
be 5-10% for a highly involved Executive Chairman.

4. Scientific Advisory Boards
- High value when your technology looks risky
- Good starting point for a science company
- Low actual contribution on tech (IP issues)
- Meet once per year - perhaps
- Symbolic stock award (e.g. <1% in total)

5. Business Advisor
- High value when you are first time CEO. Help you set
strategy, recruit team, get financed, connect with
customers, find vendors. Ideally also an angel investor.
- Find these by networking, MIT Mentors, entrepreneurship
events, VC referrals.
- Wide variation in effort – talk monthly or weekly or more…
- An “advisor” stock award is typically 0-1% to get their name
value and a few calls; but depends on effort. Think of what you
would pay in dollars, double that, and give that much value at
your initial valuation. If the effort will stay high over time then
convert to co-founder or director or exec chairman.

6. Mega Business Advisor: Incubators
- A collection of mentors who are well proven and networked
- Visibility and some quick credibility as application required
- Built in support group with other first-timers
- Incubators like Techstars and Y Combinator cost 6% equity;
you can access Trust Center for MIT, MIT Mentors for free
- Others like Cambridge Innovation Center, Dogpatch, some VCs
offer office space with administrative help
- Outstanding for: first-time entrepreneurs who see value in
available mentors and/or want to delay setting up an office

7. Lawyers
- You need several types: corporate, general, patent, HR
- Pick a name-brand firm active in Boston VC area
- Find your lead partner. Get trusted referrals then meet 3
and pick 1. This person is a critical advisor.
- Look for mature business judgment; someone who knows
when to fight and when to compromise.
- Can be good source of angel leads.
- Some law firms give a 10% discount for start-ups or will
defer cash payment until you are funded.

8. Banks
- You need a bank account but not much more at first.
- Some banks do a lot of business with VC funds and offer
venture leasing or other products, for a fee. Useful later.
- Get referred to a “relationship manager” from an investor.
- Most Boston start-ups use Silicon Valley Bank, Comerica.
- Relationship managers will know lots of
VCs, accountants, auditors, CFOs and part-time CFOs.

9. Accountants and Auditors
- You will probably need a bookkeeper or part-time CFO to
track your spending and prepare reports. Ask investor for
referral or look in directories of service providers and shop.
- You will always need an outside accountant to file your tax
returns. You probably need an auditor to review your books.
Investors insist on this.
- Bigger audit firms are more expensive BUT some offer
strong programs for start-ups and have lots of VC
connections. Using a name firm is worthwhile if you must
raise a lot of money or deal with corporate investors. The
top in Boston are: Deloitte, PWC, Ernst & Young.

10. Headhunters
- Many will call after you post first job.
- Common wisdom: avoid this early on, and use personal
networking and conserve cash.
- Exception: do use headhunters for the first hire from an
industry or function where you have no inhouse experience.
- Certain headhunters follow a niche industry closely and will
know all available executives personally. That is gold.

11. Investors
Board of Directors
Tech Advisors Input Suppliers
Founding
Team
Biz Advisors Joint Developers
Outsource
Lawyers Partners
Distributors
Bankers
Lead Customers
Accountants
Beneficiaries
Headhunters

12. Lead Customers and Distributors
- The BEST kind of financing comes from customers
- Ask for the sale: non-binding letter of intent, joint
development project, soft PO, NRE, non-cancel
PO, prepayment, loan, investment
- Be careful: partners may file over you, or under you.
Partners may analyze and publish and issue PR and make
demos. Once you “offer for commercial sale” you lose patent
rights!
- Delicate art of exclusive arrangements and tie-ups....
- If distributors operate in your industry, they are valuable to
find lead customers, but avoid signing a contract too early

13. Suppliers, Joint Developers, Beneficiaries
- E Ink Suppliers: Air Products, Degussa-Huls
- E Ink Outsource Partners: Toppan
- E Ink Joint Developers: Philips, Epson
- E Ink Beneficiaries: Intel, Publishers
- Your success is their success. Either financial or PR payoff to
them. They often make investments to secure your allegiance
or monitor your progress. Less valuation sensitive.
- Beware! These deals are high risk/high reward. Your choice
of partner will permanently alter your fate. Be careful of IP and
VC and end customer perception. Be ready for turnover and
strategic shifts. 80% failure in the long run, so prepare.

14. Closing Thoughts
You live to your fullest potential when you dedicate yourself to
a challenging dream that builds lasting value for others.
Look inside and outside for support.
Be persistent and you will get there.