By Fernando Berrocal
Let’s face it; leading a brand-new startup is a risky endeavor. Decision-making under heaps of pressure can lead to bad choices–effectively setting back your venture’s progress (or ending it). Your capacity to respond decisively and properly under pressure while launching a startup will be influenced by your business experience, entrepreneurial talent, and knowledge. If you lack any of these important qualities–which is typical for first-time business owners–mentorship might be the difference between survival and failure for your business.
In the preliminary stages of a startup, however, mentorship involves more than just business advice. Another challenge facing newer founders is how to discern between excellent and less-than-excellent mentorship. You must try to distinguish between the knowledgeable, devoted, hands-on, and tailored counsel that a good mentor offers, and the piles of general ( and well-intentioned) advice relatives, websites, and newsletters can offer.
The following traits are some of the most common characteristics of a good startup mentors:
- Expertise. You’re going to require counsel to supplement your knowledge and experience. It's uncommon for a single entrepreneur to have equal intellectual foundations in tech, finance, management, and all the other areas necessary to make the best judgments rapidly. Your mentor(s) should provide you with experience-based knowledge to fill up any gaps in your own experience, skills, or talents.
- Experience. This refers to the skills of an entrepreneur who has established a lucrative business in the same field (or a closely related one). The best experience is recent, applicable, and relatable–this provides a basis for your confidence in the given advice.
- Honesty. A good mentor will give you the truth, even if it disturbs you, while still being helpful. Sugarcoating may be easier on the ego, but it is ultimately less ineffective–a good mentor understands how to convey information directly. Similarly, a skilled and experienced mentor can communicate less-than-ideal news in a way that is encouraging–and motivates you to stay inspired.
- Commitment. Ideally, you want a startup mentor to continue supporting your project in every possible way. A mentor's support assures consistency in the startup advice you receive. Furthermore, their desire to assist you in making difficult and crucial business decisions is a make-or-break quality that can change the course of your business’s path entirely.
Angel Investors as Mentors
Angel investors are individuals or groups who provide funding for potential startups. They earn their distinctive moniker because they frequently go where private equity and Venture Capitalists (VC) hesitate to go. They will gladly put themselves in risky positions with unproven ideas–if they stand to earn a profit. Due to their often extensive and kaleidoscopic experience, they tend to also act as mentors within the startups they fund. This relationship is mutually beneficial; as a fledgling founder, you benefit from expertise and relationships. Simultaneously, the angels have the satisfaction of taking proactive measures to safeguard their investments. Startup founders often find that angels who engage in active mentorship are more likely to remain dedicated to your business.
The Angel Capital Association (ACA)
With more than 13,000 investors across 260 angel groups and platforms, the Angel Capital Association (ACA) is the biggest professional development organization for angel investors. Over 91,000 initiatives have received funding from the ACA. Finding the local angel groups and looking for mentorship possibilities can also be accomplished through their platform. Entrepreneurs frequently look to VC businesses and private equity firms for financing once a venture has expanded to the point where it requires subsequent rounds of investment. These firms provide mentoring programs that are suitable for the stage of development of your business. Note: A VC business called New Enterprise Associates (NEA) offers entrepreneurs in product design mentorship programs. Mentorship programs offered by specialist angel investment organizations and other significant sources may potentially be of interest to you as an entrepreneur. The following groups are a few examples:
- For women: "Pipeline Angels" and "Golden Seeds" are two significant groups that support female entrepreneurs. Pipeline Angels organizes financing presentations and boot camps for female entrepreneurs in need of early-stage capital. These camps include practice sessions, instruction, and coaching. Golden Seeds is a dynamic early-stage investment business that offers mentorship exclusively to women.
- For minorities: There are two primary categories for minorities: 500 Startups and Black Founders. 500 Startups focuses on providing early finance and mentoring for businesses with a minority business model. They provide a Seed Program with additional support, $150,000 in seed money, and four months of coaching. Black Founders is an organization that gives black entrepreneurs access to mentorship.
- For veterans: In the case of veterans, there are two well-known alternatives: Hivers and Strivers, and The Veteran Entrepreneur Network. In the case of Hivers and Strivers, the investment is in recent military academy graduates who are entrepreneurs. This group provides mentors who act as board members and consultants. Lastly, The Veteran Entrepreneur Network offers veterans business coaching on an individual basis.
Note: Not all mentoring results from financing initiatives. For mentorship that doesn't directly include funds but can lead to funding through programs, you can look to a variety of alternatives. The following are a few examples of these cases:
- Small Business Development Centers (SBDCs): In collaboration with universities and state economic development organizations, SBDCs are partially sponsored by the Small Business Administration (SBA). Small Business Development Centers (SBDCs) provide free advice to entrepreneurs on subjects including manufacturing, financial planning, and business plans.
- Incubators: These are support groups that give entrepreneurs who seek a solid foundation before starting a business instruction and mentoring. The International Business Innovation Association (INBIA) connects entrepreneurs with startup incubators, accelerators, co-working spaces, and other organizations to assist them.
- SCORE: The majority of America's volunteer business mentors are provided by SCORE, another SBA partner. Through a straightforward application procedure, SCORE makes mentorship available thanks to its 10,000 volunteers. SCORE may assist business entrepreneurs with the creation of business plans, handling money, and other issues.