Sheila Marcelo's Blog

Fortune Most Powerful Women Summit

2009-09-28T12:01:40-04:00

Whew! I’ve been traveling a ton lately and I’m just now catching up after a terrific trip out to the West Coast. Fortune invited Care.com to their Most Powerful Women’s event in San Diego, and it was a truly inspiring experience.

It was amazing to see so many leaders (mostly women) gather together from the business world, government, non-profits organizations, higher education, and other areas to mentor and support other women from developing countries, raise funds and awareness for cancer, and guide entrepreneurs like me.

These women are indeed powerful! It encouraged me to see them overcoming obstacles and doing so much to shape the world’s future. They’re leaving behind a legacy that our sons and daughters can look up to.

I have to say, “Thank you,” to my mentor and advisor, Susan Lyne, who nominated me to attend this event. Susan is the CEO of Gilt Groupe.

You can read my full recap of the whole summit at my Care.com blog. Let me know what you think.

Funding for Female Entrepreneurs

2009-09-15T17:36:27-04:00

During an interview for an upcoming magazine article, the reporter asked me what made me “unique” as an entrepreneur. I thought for a second, and said that it had to be being a female, VC-backed Founder and CEO. Then, just the other day, a friend forwarded me this intriguing blog post from FastCompany which says, “a paltry 5% of all venture capital investments in high-growth ventures went to women-owned firms from 1953-2001” (the last year data was available).

Turns out, my observation was backed by real data—women are a rarity among VC-backed startups. I forwarded the article to my friends Gail Goodman of Constant Contact, Maria Thomas at Etsy, and others. They agreed that we are certainly in the minority.

So why are there so few women technology entrepreneurs? The writer went on to explain some possible theories behind the small numbers:

Women entrepreneurs tend to have smaller social networks, and their networks often lack the kind of breadth and diversity that yields most benefits.

Is that true? Are we on the outside of some “old boys club” in our business networks, or is it that there’s a reluctance to fund women-run companies in the investment community? I do think that can be the case in the VC world, however, I am aware of some great firms investing in women-run companies: Matrix Partners (full disclosure: they funded Care.com, but also Gilt Groupe founded by Alexis Maybank and Alexandra Wilkis Wilson); Union Street Ventures; and here on the east coast there’s the CWE Angel Network, Golden Seeds, and Openview Ventures to name a few.

Are VCs starting to be more open to female entrepreneurs? Perhaps, but the growth is too slow. And in 2007, the number of companies with female CEOs dropped to just 3 percent of all those that were funded by venture capitalists.

Women entrepreneurs have different motivations for starting companies than their male peers, including a need for flexibility that can lead them to choose to found lower-growth companies and therefore not seek venture capital.

Do you agree with this? Or do women strive to build high-growth companies, but find it challenging to convince VCs that they can do that and also have a family life? Friends have told me stories of investors asking how they plan to run a company while being a mom—do you think they’re asking dads the same question?

Women entrepreneurs experience bias and stereotyping and are less likely to receive funding for equal competence.

I do have to agree with the last point, which is backed by research: women do experience a prevailing bias when they’re looking for investors. The post went on to argue that one way to help eliminate possible or perceived bias is to have more female venture capitalists—something I’d wholeheartedly support!

What do you think? Is the FastCompany blog post on target or way off base? I’d love your thoughts.

Nataly Kogan (CEO of Work It, Mom!) -- What the Recession Means for Community-Driven Websites

2009-05-04T16:01:48-04:00

I’d like to continue the “CEO series” with another Q&A on the recession’s impact. Nataly Kogan, a friend of mine and the CEO of Work It, Mom!, answered a few questions about how she’s shifting gears at her company and what she’s looking for in the coming months.

Work It, Mom! is an online community for working moms. It’s a place where moms can go to share experiences while giving and receiving the advice and support that make their daily juggles just a little bit easier. The site is unique in that Work It, Mom! doesn’t employ a stable of editors and writers to tell moms what to think and do. Rather, they’re mostly community-driven with articles, interviews, and essays contributed by real moms—cutting out the “middle mom” and getting right to the issues at hand.

I asked Nataly, who also has a background in venture capital, about the coming year and how it’s affecting her business plan.

What are your predictions for 2009 for your company and its goals?

2009 is not going to be an easy year—if anyone tells you otherwise, I'm not sure they are being honest about their business. But as the media has reported, targeted, niche, vertical sites and blog networks (like WorkItMom) are weathering the economic storm a bit better than broader portals so we're encouraged by that.

How has the recession affected how you do business and your budget?

We have reduced our growth plans and projections to be realistic and are focused on operating at a break-even level. What my years in venture capital taught me is that companies that get lean and mean during tough times are usually the ones that survive and emerge on the other end of a difficult economic climate.

How has the recession changed the venture capital/fundraising landscape for your company?

The recession has significantly reduced the amount of venture and angel funding flowing into early-stage companies like ours. Another trend we've seen is that investors are more risk-averse and even the ones that have invested in seed or Series A rounds are looking for more established operating metrics (revenue streams, clear path to profitability, etc.) to get comfortable. We're not raising venture capital in 2009 and are instead focused on sustaining the company at its current break-even level.

Does a site like yours, which features user-generated content, have added strength to weather economic downturns? How so?

I think there may be some benefit to the fact that some of our content is user-generated and therefore free. We do have paid bloggers and freelance writers so not all content comes from the users. But our community members definitely appreciate having a supportive and trusted online community where they can come and share some of the stress and anxiety they feel due to the recession.

What advantages do you see in this economic climate?

I think one of the advantages is that high-quality sites and companies (and their management teams and founders) get a chance to stand out from the noise, if you will. It's not easy to continue to operate and succeed during a difficult economic climate and I think only possible if you are building something genuine and necessary.

About Nataly Kogan:

Prior to launching Work It, Mom! Nataly was a Managing Director with an early-stage venture firm based in New York City. She focused on investing in digital media and software start-up companies, had her share of great successes and dismal failures, but most importantly, learned one thing—she wanted to build companies rather than invest in them.

Nataly is a mom of a three year-old daughter and she has struggled to juggle work and family since her daughter was born. Some of the most useful advice she has gotten came from other working moms but she found that she had precious little time in her busy schedule to actually meet many of them in person. Work It, Mom! was born to allow professional moms to connect with each other online and share their ideas, stories, and real-life advice with each other.

Karen Ong (of MyHappyPlanet and Language International) on Business in the Recession

2009-04-10T16:29:35-04:00

Nowadays, everyone is talking about the recession, big business, and bailouts. I wanted to join the conversation on my blog, but also do something a little different, too. One of the most interesting (and often overlooked) aspects of the recession is its impact on entrepreneurs and startups. To get to the heart of how the downturn is affecting young businesses, I chatted with several CEOs and will be posting their responses over the coming days.

Karen Ong, of MyHappyPlanet and Language International was gracious enough to take time out from running two companies to chat. Her first startup, MyHappyPlanet, is a social networking site with a purpose—it helps its members learn languages by connecting them with native speakers. “An online community for people who are passionate about learning languages,” MyHappyPlanet users utilize video and chat functions to meet other members, learn languages, ask questions, and make friends worldwide. Language International is the logical offshoot of MyHappyPlanet. It’s a site that connects potential language students to hundreds of partner schools around the world (offering over 1,000 language courses), helping students find language schools and study abroad opportunities.

How has the recession impacted MyHappyPlanet?

The recession has certainly impacted us and we’re now focused on monetization versus building a nice community that has great benefits, but one we’re unsure of how to turn into a business that is profitable.

In light of the recent economic downturn we’ve also decided to shift our focus from building the community that My Happy Planet is into building a business that has serious monetization potential. What I mean by that, specifically, we’ve introduced a new website called LanguageInternational.com, which helps people find study abroad programs. What we’ve learned from our members at MyHappyPlanet is that a lot of them are learning languages on the site because eventually they want to go study abroad. Understanding the behavior and motivations of our users enabled us to spot this golden opportunity of actually helping them find study abroad programs and generating commission revenues from the schools each time we do send students.

Has the recession impacted how you plan to spend or raise capital?

At the time the economic recession hit, I didn’t want to raise money at that time. Instead of doing that, I did two things. One was pull back on our burn rate to extend our runway further, and we also switched our business model to focus on monetization.

Is the startup world’s focus on monetization a permanent shift? Or is this a temporary reaction to the recession?

We’ve seen cycles before. During the dotcom bubble of the 2000s, everyone was, “Oh, let’s do a startup! As long as it has ‘dot com’ at the end of its name, it’ll be fine and will be valued insanely high by the market even without a solid business model.”

But soon after that came the burst of the bubble, and we started seeing a shift again and investors said, “You have to prove your business model first.” Once the market started improving, somehow people started forgetting about that again. And with the rise of web 2.0 and all the social networking phenomena, suddenly everyone was into building a community… and worrying about monetizing later. Now, it’s shifting again back to monetization. Will it be permanent? There will be cycles certainly, but the question of how you’re going to make money always needs to be answered.

Do you feel like your business is in a position of strength to weather the recession because of your international focus?

I would say yes because we’re globally hedged. If the U.S. economy is extremely poor, that’s in fact great, because all of the English learners who want to come to the U.S. will find it a lot cheaper… But the problem we’re seeing now, though, is that it’s not just a U.S. recession but something that’s widespread globally. You see this even with my conversations with languages schools that we work with—they’re certainly seeing an impact this year. Their business is down this year as opposed to last year.

The good thing about down markets like this is that it definitely weeds out competition. A year-and-a- half ago when we started working on MyHappyPlanet (when the market was still good), we were seeing new language-related startups come up every few months. It was really crazy. Now that the market’s bad and it’s a lot tougher to raise financing, the bar to start a new company is a lot higher. I certainly expect competition to be a lot less fierce.

What do you hope to see in the future?

I hope that the economy certainly turns around for the benefit of everyone. Even in difficult times like this, there are still tons of opportunities. In some sense, I think it is good for the startup scene because it weeds out companies that probably shouldn’t even have been started in the first place. And, secondly, it really imposes more discipline for companies to start thinking about the economics of their business a lot earlier than they did in good times.

About Karen Ong

Her passion for languages and different cultures led her to start LanguageInternational.com, a site for finding and comparing language courses, and MyHappyPlanet.com, a social media site for language learning and cultural exchange.

LanguageInternational.com and MyHappyPlanet.com are a continuation of Karen's interest in building global businesses. Prior to MyHappyPlanet.com, Karen led the turnaround of Olay's skin care and Clairol's hair care businesses in Southeast Asia, Australasia, and India. She also worked in a family business, responsible for sales and product outsourcing to China.

Karen is a language and travel enthusiast, speaks 6 languages and has traveled to over 100 cities in 6 continents. She is a member of NAFSA: Association of International Educators, an organization promoting international education and providing professional development opportunities to the international education field.

She also holds an MBA degree from Harvard Business School where she received the prestigious Robert F. Jasse Award honoring the student with the most outstanding entrepreneurship and leadership skills.

Tips for Success from Paige Arnof-Fenn

2009-03-05T12:15:59-05:00

Paige Arnof-Fenn is a friend of mine. We're always running into each other at different conferences or on speaker panels. I invited her to stop by the Care.com office to give us some tips on thriving in the workplace. She's always impressed me as a speaker and she definitely didn't disappoint, drawing from her own (very successful) career to share hints that anyone can apply to their own lives.

Paige is the founder and CEO of the global marketing strategy firm Mavens & Moguls. Before starting her own company, she was a VP at Zipcar where she supervised all sales and marketing. Prior to that, Paige served as a VP of marketing for Inc.com and for Launch Media, as well. Paige also worked for Coca-Cola and the Department of Treasury. She currently serves on a number of boards and advisory committees for a wide variety of companies and organizations. She's led a dynamic career and is a terrific marketer.

Here are the highlights of Paige's presentation:

Always be in a situation where you can learn from the best.

Your work environment matters. When you work with a broad base of smart people, you never know where you'll end up. Later in life, you might find yourself getting pulled along with them on the way to bigger and better things.

School never ends (if you're lucky).

Try to always be in "continual education mode." In these difficult times, it's good to remember that the toughest periods in your career are also the times where you learn the most. Untangling a problem is the best way to learn why something works and why it doesn't. That can be a great experience.

Work for a company with great values.

When you do, you'll never have to check part of yourself at the door. You'll always be able to believe in what you're doing.

There's no such thing as failure.

If something you try does fail, learn what you can from it. If you gather something from the experience, then it wasn't a failure. Don't let fear of failure get in your way, either. Those wonderful "A-ha!" moments only come when you've been challenged. Push, grow, learn!

Find a mentor.

Find a mentor in your work and extra-curricular lives. These people should be respected individuals that you can go to for advice and counsel. Take your time to establish these kind of relationships—go out to lunch with your superiors and people in other departments, especially those who are different from you. Don't just stick to who and what you know. When you find a mentor, be a sponge and soak up all the information you can.

This person doesn't have to be a mentor for life. We all go through different stages. You may reach the point where the relationship turns into a friendship. When that happens, view the situation as a door opening to a new mentor.

(In a recent post, Phil Terry, CEO of Creative Good, also talked extensively about the importance of mentors.)

Don't forget your other parts of life.

Your job isn't everything. The more you give, the more you get. Look outside your business life and get involved with networking, non-profits, interests, and hobbies. Find other like-minded people who challenge, influence, and educate you.

Make friends before you need them.

Be nice! It's not about your pedigree or title, it's about just being a good person. Never underestimate the power of common courtesy. (Those lessons your mom taught still apply!)

There have been times where Mavens & Moguls has been hired because we had the best manners—during business negotiations and pitches as well as in general practice. Things like that come back in spades, so be nice to everyone no matter what their job description or title. Good things can (and will!) come back to you.

It's hard to compete with people who don't think they're working.

If you're not psyched about what you're doing, find something else. Do what's true to you, a job you can bring your whole self to everyday. If your current job doesn't do that for you, it's time to find another challenge.

TJ Mahony on FlipKey.com and raising funding for startups

2009-01-26T16:48:05-05:00

Flipkey.com is a vacation rental review site with a twist—instead of promoting properties that pay for advertising, they allow past guests to give feedback to rank the homes, apartments, and condos. It's a free service that's "committed to helping all vacationers find the ideal vacation home rental." I was a seed investor, so I've been happy to see it grow into a trustworthy, popular vacation rental source since its March 2008 launch.

TJ Mahony, one of FlipKey's co-founders, was good enough to answer a few questions about his company, his past startup Compete.com, and raising funds for entrepreneurs.

Why did you decide to start FlipKey?
In 2006 I began renting [out] my condo in downtown Boston as a short-term vacation rental. I quickly discovered vacation rentals were in high demand, but I also learned that the experience was a bit unpredictable. I was able to easily rent my unit using a vacation rental listing service; however, issues of trust, information and expectations consistently arose between prospective guests and myself. The guests often asked me to prove my identity, requested referrals from past guests and typically contacted me for weeks after I had already rented the unit. The whole exchange made me think, “This [vacation rentals] is a wonderful product; however, there is no trust. More people would seek vacation rentals accommodations if they could simply trust the experience more.”

Trust is not a small problem to solve, so I boiled it down to one core element: Verified Guest Reviews

If FlipKey could design a new and efficient way to collect and publish real reviews of vacation rentals, we could allow the marketplace to create and deliver a new layer of trust.

How does FlipKey differ from other vacation rental sites?
FlipKey is the only service focused on creating an efficient and effective way to collect and publish guest reviews. There are plenty of hotel sites on the internet, but only one TripAdvisor. We felt it was time to offer a TripAdvisor-like resource for the vacation rental industry.

Tell us about your transition from Compete.com (a web analytics company) to vacation rentals. How are the two start-ups similar? How are they different?
The original vision of Compete.com was to promote online transparency. We wanted to create a free resource to allow anyone to evaluate the safety and popularity of any website. Within a year of launching Compete.com the site was attracting over one million visitors per month.

The vision of FlipKey maintains a similar vision of transparency, but focuses on vacation homes instead of websites. We want to provide a service that allows vacationers to discover and evaluate the breadth of vacation homes in the market, leveraging verified guest reviews as the bridge to creating a new sense of trust and excitement with the product.

Why did you decide to go the angel/private investment route versus venture capital for your first round of funding?
There were two reasons. First, we thought it was critical to establish a product, early user testimonials and industry brand recognition before seeking capital. Without these support elements we risked not being funded or being forced to accept unfavorable terms. We were a young team, so we knew we needed more than a PowerPoint to receive funding.

Second, we needed to move fast and the only predictable source of cash would come from private investors. We knew private funds would only get us so far, but we also knew we could secure private funds faster than working with a VC.

Do you see a potential connection down the line between FlipKey and Care.com?
Sheila and I have toyed around with various ideas, but it’s too early to get ahead of ourselves. Ultimately, there are some clear needs among vacation rental consumers that can be serviced by Care.com:

“Let’s have an adult night out—how do we find a trusted babysitter in this town?”

“The vacation rental house doesn’t allow for pets—who's going to take care of the dog while we are gone?”

And so on.

For more information on FlipKey, visit their website or check out their blog, which TJ contributes to frequently. Back in August, TripAdvisor announced it became a majority investor in FlipKey. TripAdvisor reportedly plans to incorporate FlipKey's tens of thousands of vacation home rental properties into listings on its own network of travel websites.

Micah Chase on Customer Service

2009-01-05T18:40:46-05:00

I met Micah Chase, the founder of eInvite and President and CEO of Checkerboard, through my Creative Good council (see this previous post for more info on Creative Good). Checkerboard is a designer and manufacturer of invitations and announcements. Its handmade products are featured in high-end retailers and online stores. Micah's other company, eInvite, is one of Checkerboard's customers and serves as its online portal for selling custom-made invitations and greeting cards. I've found Micah to be a great leader as well as an innovator. He comes from a techie background (his bachelor's degree is in artificial intelligence) and he owns the patent for an online ordering system that lets customers view a real-time proof of their card designs.

In the business world, he's focused on providing customers with the best possible experience and he's been very creative in his efforts to boost customer service. Micah's innovations led eInvite to achieve the highest Net Promoter Score (NPS) of all members of Creative Good—that's something to be proud of.

I invited him to Care.com this fall to talk about serving the customer and now I'm sharing his comments with you.

Building small, segmented teams
We took people from our customer service, typesetting, and billing departments and put them together into one group. That way, when people called with questions, they had them answered right away, no matter which department they applied to. Our processing time went way down and our orders shipped quicker. And we were more efficient because when customers wanted something, they spoke directly to the person who had the answer. In turn, there was less confusion and back-and-forth iteration for each project.

Changing the pattern
We saw the realignment was working. So, we blew it up.

We changed the pattern again and set up cross-functional groups. We kept the same inter-departmental model, but segmented it by our different customer groups. We serve chain stores—they tend to have a high employee turnover rate, so they're looking for a vendor that's easy to understand and quick to respond. We also supply boutiques—people there have been in the business for years, know the ins and outs, and don't need someone holding their hand. And we also sell to individual customers who are completely new to the process.

So we gave targeted help to each base. Our long-term service people took care of the boutiques and stores and we had our most effervescent people to handle the excited newlyweds looking for custom-made invitations. The teams split into groups that specialized in specific, simple help for experienced clients and others that offered comprehensive services.

That right there shot our NPR score up 15 points, which is quite a jump.

Picking the right people
Getting the right staff is really hard—I don't know if we've gotten it right, yet. During this whole reshuffling process, we changed management. That was a hard thing to do, but it was a step in the right direction. Making sure everyone's onboard is an ongoing process (one that initially caused conflict), but we're seeing the benefits. People in separate departments now understand what everyone does, team loyalty has improved and there's connection between employees that wasn't there before.

Above and beyond
We posted pictures of brides around the office to improve service—it puts a face to the customer. We have testimonials everywhere. We've also implemented a new technology in our sales system. When someone pulls up a specific store in the computer, they see a picture of that store or the employees. It's a way to maintain focus on the customer, which is right where we want it to be.

Mistake? Fix it!
When it comes to the customer, it doesn't matter who's mistake it is (ours, theirs, another department's, whatever)—just fix it. In the long term, it ultimately costs you less to fix it right away than to drag out the process, even if you're losing money on that particular sale. We're a supplier to big retailers like Costco and BabiesRUs—the last thing we want is an angry customer going past us to them. Those companies would drop us and we'd lose a big chunk of our business.

So, our policy is to always offer options and an explanation. I also try, in any conflict, to send a personalized note. In an age where there's not much face-to-face interaction, it lets the customer see you as a person and not someone looking to make a bottom line.

For more information on Micah's companies, check out their websites: eInvite and Checkerboard.

Filipinos in Boston Kickoff Event

2008-12-29T09:16:30-05:00

Last month, we hosted a kickoff event for the newly formed Filipinos in Boston organization. It's a way to connect the vibrant Filipino community here back to its home nation. Going forward, we're hoping to schedule regular events to share our culture and also put together a concentrated philanthropic effort to help those in need in the Philippines. I’m happy to report the meeting was a success and we're all looking forward to what happens next! I wanted to share this summary with you, so you can keep up with what we're doing.

After a catered cocktail hour, the night's emcee, local NBC news anchor Frances Rivera, officially opened the meeting with a touching, personal account of embracing her heritage. She grew up in the predominantly white suburbs of Dallas, Texas, resenting her "differences." It wasn't until she spent five years studying at the University of the Philippines that she was able to understand and celebrate her own, unique culture.

Frances' sentiments inspired me to share some informal remarks about my own upbringing. I tried to emphasize the importance of making connections within the Boston-area Filipino community in order to give back to the Philippines, and also to help teach the younger generations of Filipino-Americans about their heritage, encouraging them to understand and embrace their culture.

Victoria Garchitorena, president of Ayala Foundation USA, introduced the non-profit's history and impact, spotlighting its Gearing Up Internet Literacy and Access for Students (GILAS) program, which brings the internet and computers into classrooms throughout the Philippines. At the end of the evening, the group decided to create a Boston chapter of Ayala Foundation USA, joining nine other AF-USA chapters around the country. The group will create more events and activities to celebrate Filipino heritage and support Ayala's philanthropic efforts in the Philippines.

And the final speaker of the evening was Dr. Victoria Herrera, who is a professor of medicine at Boston University and part of the Child Protection Unit (CPU). She showed a touching video that highlighted CPU's work to stop child abuse and aid abused children in 20 provinces throughout the Philippines—a very worthy cause.

This meeting was just the first step in an exciting direction for Boston's Filipino community. I can't wait to see what's in store from this dynamic group!

Holiday Parties in the Downturn

2008-12-23T12:24:52-05:00

Although we are in a recession, I still find the winter season abuzz with holiday parties. However, before and after the "official announcement" came that the economy's been in recession for a year, we saw news stories trickle in about companies shifting away from their usual holiday plans to save money. But the best stories came from companies staying in step with the generous spirit of the season and choosing to give back to the community.

Giants like Citigroup, American Express, and Morgan Stanley canceled their holiday parties (the latter, reportedly, plans to donate its party budget to charity). Barclays, which held a $1.2 million shindig last year, axed all of its holiday functions except for ones geared toward employees' children. Marriott encouraged employees to spend a morning serving free meals at a D.C.-area soup kitchen and then held a holiday party at an executive's home. And Cisco recently announced it's completely shutting down for four days at the year's end as part of an effort to save $1 billion.

Now that we're in the thick of the holiday season, I think it’s great that companies aren't only saving money, but are also finding ways to give back to charities. At Care.com, we held our annual holiday function for employees and their loved ones to cap off the year. We had planned on having two celebrations—one for the annual holiday party and another to celebrate a huge milestone—but we decided to merge them into one, save the money, and instead donate to a non-profit called Outdoor Explorations. OE is an organization, headquartered near Boston, which gives disabled kids access to outdoor adventures and runs trips for more than 2,000 participants annually. We worked with OE to clean up a nature preserves they often visit by clearing debris, landscaping, painting, and doing minor construction work. You can read more about our volunteer project and OE here.

What are your companies doing? Leave a comment below and let me know.

No matter what your employer chooses to do this quarter, I do hope you and your family have a great season. Happy Holidays!

Types of Business Advisers

2008-12-11T09:13:18-05:00

I was just at a women's business panel and I was asked the question, "Do you have mentors and advisers?" Absolutely! Don’t know how I’d keep sane without them.

Strategic Business Advisers

People who can give objective advice from outside the company on matters of structure, leadership, and strategic planning
Provide advice in negotiation, valuation, etc.
Poke holes in your business plans in terms of forecasting and projecting revenue streams
Help with introduction to investors, sales/marketing contacts, etc.

Likely candidates include:

Angel investors/Venture capitalists—they are more than just a source of funds. For benefits of VC's outside of financial backing, check out my previous post on Starting a Business.
Board members
Professors from business school

Personal Advisers

People you admire/emulate
Solid friends/family who are there to support you (making sure you do, in fact, have a personal life) and also tell you what you don’t want to hear

Special Area Advisers

If you don’t have background in specific area (i.e. tech, finance, SEM/SEO, etc.), finding outside advisers who specialize in those areas can help you better lead your company
Basically, anyone that helps improve your business (Although, usually, you have to pay for this advice, but equity also works too!).