Lies, fake news about Facebook and outright scams have grown more common on the giant social network than weeds in a Farmville player’s fields. Now the problem has reached the very top of the organization, with one of only four members of Facebook’s hyper-exclusive Board of Directors apparently handing his account credentials over to a service that started spamming his friends with a fake offer of a “Facebook phone number.” If a guy like that falls for it, who can blame little old you or me if we fall for such a scam, too? Apparently the Board Member, investor Jim Breyer, has had his Facebook account suspended over the spam. “Users whose accounts have been compromised are put through a remediation process, where they must take steps to re-secure their account and learn security best practices,” a Facebook official told leading financial industry blog PEHub yesterday, “This is what happened with Mr. Breyer’s account.” If Facebook becomes all the more awash in scams and spams, this may be a key symbol of when the tide turned and it became too much. Sponsor If you’re a regular Facebook user and have friends outside the tech industry, you no doubt see all kinds of scams, spam and rumors being passed around. For example, that Facebook will soon start charging users for their accounts. (Totally untrue.) Facebook is now a very mainstream phenomenon, and so the same millions of people who are too busy doing other things in their lives to know what an internet browser or other basic technical matters are, now push messages around Facebook sometimes with little familiarity with how things work and with less friction than ever before. In as much as Facebook has brought push-button publishing and social graph technology to hundreds of millions of people around the world for the first time – this is a big challenge the company is going to have to deal with in order for its service to have maximum, long-lasting impact on our culture. Smart people fall for phishing scams, there’s nothing new about that. Phishing is old enough too that it probably doesn’t make sense to feel ashamed, either. In as much as Facebook has brought push-button publishing and social graph technology to hundreds of millions of people around the world for the first time – this is a big challenge the company is going to have to deal with in order for its service to have maximum, long-lasting impact on our culture. Can Facebook Kill the Spam? See also: What Happens When You Deactivate Your Facebook Account and “How Do I Delete My Facebook Account” – A Fast Growing Query Facebook does have a unique advantage over email, the company points out. When a message from a source is discovered to be spammy, the company can zap it system-wide all at once. Apparently that’s only proven so effective so far, though. If every social network rises and falls, though, effectively tackling this problem may be important to protecting the Facebook user experience from “pulling a MySpace.” When the problem reaches the very top of the company, it may be time to be concerned. MySpace took big steps to kill spam years ago, but not until it was too late and the company’s reputation was set. Can Facebook save itself from a similar fate? We’ll see. Discuss

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No matter how carefully you build your founding team, questions will come up as you start your business that will make you want to turn elsewhere for advice. And so it’s good to have a carefully selected group of people you can turn to for help: your Advisory Board. As Bernard Lumm notes in ” Startup 101 , “You may have any number of advisers – friends and family – who you turn to informally for advice and who expect nothing in return except your friendship. But we use Advisers here with a capital “A” to denote someone with an official, compensated relationship with the company.” Sponsor Who to Ask When building an Advisory Board, you want to select people who bring knowledge and credibility and who have the time and willingness to help. It’s important the members of your Advisory Board have some background in your startup’s field, and it’s good to pick people who have succeeded as entrepreneurs. The members of your Advisory Board should also be able to speak with experience to the challenges and the successes of being executives. In other words, your Advisory Board is not made up of your attorney and your accountant. The latter, you pay for their professional advice. And while you can offer members of your Advisory Board some

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We’ve written in the past about how to communicate with investors during board meetings. Namely, don’t pitch to them. Entrepreneur-turned-venture capitalist Mark Suster posted to his blog recently some tips on how entrepreneurs should communicate with VCs in between board meetings. Sponsor Based on his experience as a startup CEO, Suster argues that it’s just as important to use the time in between board meetings efficiently as it is to be efficient during the meeting itself. He writes, “I found that too often it was an update meeting for investors rather than a meeting for my company to get value. I’ve written before about how to turn this equation around and run more effective board meetings. If you want to prevent board meetings simply becoming investor update meetings? If so, you need to do a better job of communicating between meetings so that they always feel well informed.” Good communication, according to Suster, is key to helping your VCs understand your company, your needs, and your expectations. Leverage the Investors’ Networks VCs know a lot of people, but the key is to help them introduce you to the right people. Suster recommends creating a Google spreadsheet listing your top customer prospects, business development prospects and other companies you’d like to meet. Include in the spreadsheet information on who you’d like to meet now, in three months, and so on. Have investors and board members put their names next to the people they know and encourage them to add other names to the list. Suster suggests you “make sure to politely remind investors to run intro’s by you before sending them out. We want to help. We don’t want to be unfocused. But most VC’s are “intro machines.” Help them to be well behaved. Help them to follow your process. If you’re polite and persistent they will – and they’ll appreciate it.” And of course, be sure to thank publicly at the board meeting those members who helped make key introductions. Help VCs Talk to Others About Your Company VCs need reminders in between board meetings about the key details of your company. Suster recommends giving investors a paragraph or so summarizing what you do. This isn’t a mission statement, but an elevator speech , of sorts. It’s also good to share information about your key competitors with your investors and how you feel your company stacks against them. Keep Everyone Up-To-Date on Finances Make sure all board members and investors know when you expect to run out of cash. According to Suster, “This is the single biggest thing they shouldn’t be surprised about.” Keep everyone apprised of and reminded about this date so that investors can plan according. Biweekly Updates Suster recommends sending board members a one-page, bullet point set of notes via email. Make it short and succinct in order to encourage people to read it. Consider including three categories: major achievements in the past two weeks, plans for the next two weeks, and things your company could use help with. Send the Board Materials 72 Hours in Advance This will help everyone shows up at the meeting informed and ready to contribute. The underlying principle to many of these recommendations is the importance of maintaining communication between entrepreneurs and investors. Even if you are holding regular board meetings every four to six weeks, that is too long to go in between updates. Good communication in between meetings can help insure that the time spent during the meetings is productive. Discuss

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More often than not, an entrepreneur with a great idea looking for funding will pitch his or her startup dozens, if not hundreds of times to potential investors. There is an endless amount of resources out there for entrepreneurs looking to learn the best practices for their pitch, including what to include in their decks, how long to speak, and what pitfalls to avoid. By the time an entrepreneur actually gets funding, they’ve probably mastered their pitch to a point where they could recite it in their sleep and provide advice of their own to newcomers. The problem with this is they can get stuck in their pitch mentality and it can creep into areas of their business that need the ole straight talk express. Sponsor Michael Hirshland of Polaris Venture Partners , who blogs under the name VCMike , wrote today about a problem he often sees when in board meetings with startups. The issue is that entrepreneurs are so used to speaking a certain way to VCs that they sometimes have a pitch-like tone that gets in the way of board room progress. As Hirshland points out , don’t try to beat around the bush when it comes to bad news. “VCs hear bad news all the time — it is part of the startup process and part of the VC job description,” says Hirshland. “Any VC worth his or her salt should respond to bad news, provided it is shared in a timely fashion, by helping the entrepreneur figure out the best way to respond rather than dwelling on what went wrong.” He advises CEOs to stear clear of attempts to placate their board members by spouting off excuses for whatever their bad news is, or by claiming that they are already fixing the problem in hopes of avoiding any impending wrath. From what Hirshland says, board members are not schoolmasters there to punish you and whip you into shape; they are there to help, so don’t isolate yourself, he says. If you speak openly and honestly about your issues with your board, chances are you will preserve your most valued asset as an entrepreneur and as a startup: credibility. “Early stage ventures are filled with ambiguity. Entrepreneurs and their investors need to make quick decisions based on information that is far from complete,” says Hirshland. “This necessitates relying to a very substantial degree on the entrepreneurs’ interpretation of the situation and prospects.” In other words, you are the eyes and ears for your board, and if you aren’t being open and honest with them, bad things will happen. Worst of all, speaking with fluff and rounding out the rough edges of your company will destroy your credibility, which Hirshland calls “toxic” to your partnership and “not a happy place for either the entrepreneur or the investor.” As we mentioned earlier this week, credibility is your best friend when trying to get funded, so make sure you carry it with you and preserve it in your board meetings and into your company’s future. Save the pitching for future rounds of fundraising, and when it comes to your board members, don’t try to win them over, simply treat them like equal members of your team. Discuss

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