According to a study by techcrunch, 33% of founders who are mentored by successful entrepreneurs went to become top performers. Startup founders are 3 times more likely to reach an exit of at least $100 million or be in the top 10% in terms of the amount of equity raised, or in the top 10% in terms of number of employees, according to the same study. Research clearly shows that if a big percentage of entrepreneurs’ time is not allocated to attracting the best mentors, they’re overlooking an extremely valuable startup success variable. While the effect of mentoring is especially high with successful mentors, it can be a misleading weapon to failure under bad leadership. Let us thus look at what good startup mentoring Look Like.
How would you describe the ideal mentoring? I asked 4 entrepreneurs. This is what they said.
Entrepreneur 1: I describe an ideal mentoring as being supported by a mentor or group of mentors who care about the success of my startup as much as I do and not only answering phone calls and taking meetings periodically.
Entrepreneur 2: The best mentoring is when a mentor has vast experience in the industry that my startup falls in. Someone who can clarify my startup roadmap.
Entrepreneur 3: Certainly not someone who enforces startup direction but one who believes in the vision and helps me get there.
Entrepreneur 4: I don’t mind compensating the best mentors if they help connecting me with the right people, recruit the best talent, point me to the right direction and help me raise funds.
The best mentoring is in the eye of the beholder. That is, there is no right answer as to what is commonly considered an ideal mentoring, instead, it is what satisfies entrepreneurs’ needs that determines the value of mentoring. The focus turns into finding a mentor-mentee fit. This is where most entrepreneurs fall and it is also what can triple startup performance. In finding product-market fit, entrepreneurs aim to validate the viability of the solution in matching the needs of users. Finding the fit between mentors and mentees is founded on alignment of interests and built on entrepreneurs’ needs matched by mentors’ solutions (guidance, connections, startup value, etc.).
Alignment Of Interests
What’s in it for them? most entrepreneurs know what they need and how the involvement of mentors can add value to their startups but what about the mentors? Time is their most valuable asset and never will they use it in activities that will not be of value to them too. Interests cannot be aligned unless they are clearly defined. In describing an ideal mentor, entrepreneurs must hypothesize their return from the relationship and be ready to meet those needs if agreements were to take place. Mentor compensation can take the form of equity, recognition, startup investment priority in later rounds, and/or whatever they suggest is satisfactory for them. Yes, you may hustle for a few minutes of experts’ time but never will you sustain successful long term mentoring relationships unless interests are aligned.
Just like a co-founder, what makes you a good mentee for them and vice versa? Everything is easy if it’s only once. In other words, as I state above, you can fight for the information but not unless both parties have what it takes to work together, there will not be a second date. So what does it take?
Entrepreneurs often focus on the quality of the mentor and sometimes completely forget to learn their methods. Do you need a guide or a boss? Are you looking for someone who can help you think or a person who can make the decision for you? Be aware that styles range from confrontational to supportive, practical (hands-on), passive, etc. Each one of those styles can lead to great results so it comes down to your needs. The last thing you want happening is learning that you have conflicting styles after going through a long recruiting process. All you have to do is ask. Questions about their previous mentoring experience can help you learn more about their mentoring approach and style.
Good mentoring will not only triple your chances of becoming a top performer, research by MicroMentor in 2012 shows that founders who received mentoring increased their revenue by an average of 106% whereas those who didn’t experienced a 14% increase only. The same company also found that 49% of potential founders who received mentoring ended up starting their businesses and 82% survived for 1-2 years. That’s 13% higher than the average new business survival rate in the U.S.
Good mentors will complement your skills. The best mentors are those who have done exactly what you do and proved that they are good at it. It is those who have paved their roadmap and are ready to take a smooth journey with you again. In other words, you’ll find a lot of great startup mentors who can help you make the right decisions in areas such as validation, scalability, recruiting, funding, etc. but what’s more valuable is if the mentor is a success story in the same field you are in. Someone who can help you do the same.
There is no one size fits all for ideal mentoring. It is what satisfies entrepreneurs’ needs that determines the value of mentoring. Therefore, being self-aware, defining needs and mentor roles will help you select the right mentors.
The consequence of good mentoring is significant. Another statistic by the small business administration in 2014 shows that 70% of small businesses that receive mentoring survive more than 5 years. That’s double the survival rate of non-mentored businesses.
Good mentors are crucial in helping entrepreneurs stay ahead of the market, however, this comes at a cost. Entrepreneurs must insure that 1) mentors’ interests are aligned with theirs and, 2) their mentoring style is tested and expected.
How can/did mentoring help(ed) you build value?