Would you have a friend be a startup advisor?

@Eddy. There isn't any reason they shouldn't be an advisor but you do need to sort out some ground rules in order to keep the relationship good.

• Their advice isn't law. End of the day its you making the call and your head on the line. Discussing something with someone else is critical but if you have to go against their contribution for what ever reason make it clear that is just the way it is. Otherwise people get their nose out of joint, don't feel apperciated etc.
• Their investment in the company should be CLEAR. Do they own shares or do they not own shares? This is something for you to decide early and stick to, if they own shares then I would say its a few (1-3%) while they are just an advisor and if they come on soon they can "buy into" or "work/sweat into" a larger amount of shares should they want to. You don't want them claiming shares later when you land your VC investor and you don't want them feeling hard done by either.
• What are they getting for being an advisor. Are they getting paid at all? Is it just you buy dinner and drinks once a month (this is usually a good arrangement).
• What is their commitment to being an advisor. Do they have to be on call 24/7 or 9 to 5, once a week/month ... or adhoc.
• How does either side opt out. For you there will likely come a point where their advice no longer has the value it once did. They may loose interest, have kids, whatever. If it gets to this point both need to agree that there are no hard feelings either way and also decide what should happen to shares/pay etc if there was any.

You can either formally write out your version of the above and sign it, or just print it out and both read it and agree.