Advisor Shares

TL;DR

Equity granted to formal advisors, typically 0.1–1% of the company per advisor, vesting over 1–4 years for ongoing involvement.

Advisor shares compensate advisors for ongoing strategic, technical, or commercial help. The Founder/Advisor Standard Template (FAST) from Founder Institute is a common framework: advisors receive 0.1% to 1% depending on role and time commitment, vesting monthly over 1–2 years (no cliff is the norm).

Formal advisor agreements clarify deliverables, time commitment, and termination terms. Without one, advisor relationships often drift into informal arrangements that lead to cap-table problems later.

Worked example

A founder grants a domain expert 0.25% of fully-diluted shares vesting over 24 months on the FAST template, in exchange for monthly 90-minute strategy calls and 2 customer introductions per quarter. Standard Tier-2 advisor terms.

Common pitfalls

• Granting advisor shares without a clear written agreement.
• Adding too many advisors and accumulating dead equity on the cap table.
• Failing to clean up inactive advisor grants.

When this shows up in a pitch deck

Advisors may be named on the Team slide; specific equity is diligence content.

See Advisor Shares in context

Advisor Shares shows up most often in these scoring rubrics and investor profiles — jump straight to who cares about it and how to pitch them.

In VC frameworks

• First Round Capital — pitch deck framework

Related terms

• ESOP — Employee Stock Option Plan — the legal structure that lets a company grant options to employees at a defined strike price, governed by board approval and 409A.
• Vesting — The schedule by which equity grants are earned over time, typically 4 years with a 1-year cliff for founders, employees, and advisors.
• Cap Table — A spreadsheet or system-of-record showing every shareholder, share class, option, warrant, and convertible instrument outstanding in a company.
• Option Pool — Equity reserved for future employee, advisor, and contractor grants, usually sized as 10–20% of fully diluted shares.
• Founder Vesting — A vesting schedule applied to founder equity, typically required by VC investors to align founders with the long-term outcome.

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