Is it typical for advisors to be asked to invest in a startup as a pre-condition of being an advisor?

VC Mark Suster suggested asking potential advisors to invest in 2009. http://www.cloudave.com/1381/should-your-startup-have-an-advisory-board "Forced equity compacts" (i.e., requiring company stock to be purchased) are used in many big companies at an executive level, to force commitment and align individual incentives with overall performance.

Gosh, i've never heard that before. http://myTab.co Advisors are given Equity in return for their expertise. We'd never suggest our Advisors invest in myTab unless they specifically asked us.

I am surprised while it is not a norm, why so many folks here oppose the idea. In my opinion, having advisor invest in the company creates much better alignement of interest, and eliminates the free-rider issue. I concur with Mark Suster's view on this.

It sounds like they want to pay for your advice in shares instead of cash.  I think it's called "creative financing".  You should put in a healthy discount, e.g "If you pay my bill in shares it costs 2x more than if you pay in cash."

Generally, it's not common, and I generally agree with all of the answers on this thread. I don't have that much experience, yet,  there is a bit of an "anti-advisor" trend brewing from what I hear. Specifically, the feeling at many startups is that either (a) there is a misunderstanding between the advisor and the founders as to what the relationship entails, which then strains; or (b) that an advisor will show good intent to become an advisor and then tail off in their intensity and commitment. In the same way that entrepreneurs are getting more information about investors, they are also becoming more picky with regard to advisors, and some may ask for investment in order to help align those interests a bit more. Again, just to be clear, it's something I've heard recently.

We would not ask an advisor to invest; it seems both crude and an excessive request.  We do have a number of investor advisers, but they were investors first, and later we asked them to advise.

It is atypical, and a contradiction in terms. These are two distinct roles for a reason: a founder and their investors will not always be on the same side of the table (the invest in the company not the person). An advisor should help the founder clarify and negotiate their position and can not fulfill this role when conflicted by investment in the company. (note: Mark's "Should Your Startup Have an Advisory Board?" post doesn't apply to this question as members of what is typically called an Advisory Board are really investors-in-kind.)

Advisors advise.  They get some stock to advise. Investors invest.  They should also advise. Asking an advisor to invest in order to advise is not typical. Although you may offer them the option if they are interested. An investor asking for extra stock to also advise is also not typical (that is one I heard recently).

I have heard this before, mainly from 3F investors in early stage startups. I do not invest in any start-up I'm providing advice/consulting to because I feel my advice should be based on what needs to happen, not emotionally based because of my own stake in the company. Some people argue that it should be the other way around and you should "have skin in the game." This makes no sense when the person is an advisor/consultant.