CitySquares Online Inc. saw sales start to decline dramatically in late 2008 as some of the local-search-engine provider’s customers could no longer afford its advertising services writes The Wall Street Journal.
So the small business turned to its board of six volunteer advisers—experts in areas such as sales, marketing, finance, entrepreneurship and venture capital—who suggested expanding the Web site beyond its northeast footprint.
CitySquares followed that advice and now has four national-advertising customers, up from zero a year ago.
Some small-business owners say their firms are surviving tough economic times thanks in part to advisory boards they regularly turn to for fresh perspectives and support. Yet a number of organizations that pair up small businesses with these volunteer-adviser groups say they haven’t seen more firms take advantage of their programs since the recession began.
Advisory boards can benefit small businesses in most industries after they’ve started operating, says Dennis Ceru, an adjunct professor of entrepreneurship at Babson College. But for those still in development, he recommends a single adviser or mentor instead.
Advisory boards differ from formal boards of directors because they only provide advice and entrepreneurs “don’t necessarily have to take it,” says Ceru. By contrast, boards of directors have a say in a firm’s leadership and more. “They can make decisions beyond the day-to-day operating structure of the company,” he says.
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Photo by CitySquares.