How to Spot a Good vs. Bad Project Advisor?

If you decide to work with an Advisor, I would recommend reading this article first.

To start, it's best to check the advisor's track record, i.e. the projects they have already helped. It would be great if Advisor could point out both successful and unsuccessful projects. Unfortunately, there are many "Advisors" on LinkedIn, but most of them have never dealt with any projects and haven't even read a single whitepaper.

In general, it's worth asking the advisor as many specific questions as possible to determine if they are competent or just pretending to be.

Another aspect to consider is the role the advisor played in the project and how they contributed to its success. If Advisor was responsible for raising capital, it would be good to hear about specific amounts. If he was responsible for creating a strategy, let him describe exactly how he did it. The more specific and detailed questions you ask the advisor at the beginning of the cooperation, the better.

In case the advisor was involved in a failed project, it's worth asking them about their biggest screw-up in advising and what they learned from the situation. Most people will avoid talking about their failures, but as we know, we are only human, and mistakes do happen. It's important to admit that more things fail than succeed in business.?

If the advisor is honest and describes exactly what went wrong, I think it's a valuable attribute for project.

Another thing to find out is if the advisor is an industry-specific advisor. Currently, projects in the digital assets and fintech industries that deal with NFTs, payments, and digital assets, are very different from each other and require a different approach for each topic, so the advisor must be knowledgeable about the topic the company is pursuing.

Next, you should pay attention to how many industry contacts he has. The role of a good advisor is to not only help the project technically with good advice but also to make the project known in the industry. A good advisor should have many contacts in the industry and be able to help the project reach a wider audience. If he has a well-established name in the industry, it's a good bonus but not necessarily a requirement.

Another factor to keep in mind is the advisor's compensation. You need to consider whether Advisor prefers an upfront fee, a percentage of the project's capital raised, or payment in tokens. Based on my experience, most top advisors accept compensation in fiats, valuing their time, but they usually also have token allocations in the project.

It's not ideal if an advisor takes money from the project regardless of its success. This suggests that he isn’t fully invested in the success of your project and can harm your progress. A good advisor should receive most of their compensation in fiat, but should also have a stake in the project's tokens.

It's also important that an advisor doesn't shy away from openly acknowledging their involvement in your project. Some advisors may take money from the project but not want to associate themselves with it. If you're in this situation, it's a red flag that the advisor you've chosen may not be the best fit for you.

I encountered similar issues with Cannumi, where we had originally agreed on working with two advisors who were eager to help, but ultimately, they didn't do much.?

To avoid these problems, it's crucial to clearly outline your expectations for the advisor in a signed agreement before starting the partnership.

Avoiding verbal agreements is important in any business relationship. Both parties should abide by the agreed terms, and having a clear agreement in writing ensures that everyone is on the same page.

In Cannumi's case, we had an advisor who committed to securing capital but ultimately failed to do so. He did provide some industry contacts, but they didn't result in any deals.

This advisor was highlighted as a part of the project, gaining media exposure, but the project, unfortunately, didn't benefit from that cooperation.

With the second advisor, we had issues as the cooperation terms were not documented and some tasks were completed while others were not.

So, the more specific the agreement, the better when working with advisors.

Now that you know how to spot a good vs. bad advisor, let me share my advising history.

In my journey as an advisor, I worked with several tech and blockchain companies.

So my first advisory project was Karma Clutch in 2018, which was an international insurance service for people who had lost their stuff in airports or other places.

It was after the Bitcoin bubble burst in 2018. You probably didn't hear about this project because it wasn't a success. I was in charge of creating the whitepaper as well as the overall project strategy.

What occurred? We began in a bearish market and didn't raise enough funds to complete the project.

Another experience was at Blockchain Hotels, where I served as COO. My responsibilities included running this company on an operational level, which meant I was in charge of presenting the company and managing internal issues during daily operations.

I worked on this project for three months, but even with the funding round, this project did not succeed. The company raised approximately 1.5 million PLN in the first round and approximately 100,000 USD in the second round. But, as I previously stated, the bear market did its job. Unfortunately, the company did not survive, and I had to leave it.

Another project was supposed to be an international real estate platform. I worked on this project for about 4 months. Unfortunately, the project failed because it was discovered not to be honest.

So I finished working on this project, but the experience taught me a lot. There I learned how to check the reliability of projects and how to check if a project is just a scam or a really good foundation project.

Following that, I was an investor and advisor in Horum in 2018. Horum is a digital bank, about which I will write a post on LinkedIn. I'm still working with Horum as an advisor and one of the company's founders to disrupt the banking sector.

Then, in 2021, I began working as an advisor on the Cannumi project. I was in charge of the strategy, tokenomics, and raising some investors and money.

In conclusion, when looking for an advisor, don't be afraid to ask tough questions. A good advisor should be able to provide a solid track record, demonstrate their contribution to past projects, and be transparent about their role.

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