Avoid entrepreneur mistakes with good mentors

 

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Recently I wrote about wannabe and first-timer entrepreneur symptoms. I did include cures, but the reality is it is often hard to self-medicate. 

A longer lasting cure is to get a couple of good mentors. The mentors are there to call you on all your bullshit.

You have to be open to being called out, though. In my first companies, I had access to good mentors, but didn't use them correctly and so the mentor relationships were not good (my fault), and the companies ultimately went nowhere. Now I'm not saying they would have gone somewhere if I had done the mentor relationships right, but it certainly couldn't have hurt.

What makes a good mentor? You really want someone who has been there, done that, or in the words of Mark Suster, has domain knowledge

However, just because you've identified people with the right experience, doesn't mean you can create a good mentor relationship with them. That's the hard part.

A good mentor relationship is a series of deep conversations about your startup's underlying assumptions. It is your job (in general) to identify those assumptions and validate them as cheaply as possible. Sometimes though, you can't see the forest through the trees. 

That's where the good mentor comes in. He/she should have a full picture of your business and be able to say, wait, did you think of this OR there is this other underlying assumption you haven't mentioned OR no, that doesn't prove that assumption. 

The core benefit of the mentor relationship is getting someone outside the company to think critically and holistically about the company. Making intros, specific advice, etc. are all good too, but in my opinion they are side benefits. 

From the mentor side, it's a time commitment. It doesn't have to be a ton of time, but at the very least you should be communicating once a month. And these communications should be at a deep level, which requires a free flow of information in between conversations. That means you have to be continually sending them stuff. 

So how do you get these super busy experienced people to do that? There are a few ways, but generally some form of equity compensation is involved. For example, you can get them to do a small investment at a low valuation, or give them some options. 

Note, however, that typical advising shares (e.g. 0.25-0.5%) are usually not enough. Do the math (same math as for employee options). 2%+ depending on their role and expectations is more in line. Shares should vest though, so if it isn't working out there isn't much harm done if either side decides to call it quits.

Ultimately though, the mentor needs to be interested in your particular company. Equity of course helps spike interest, but it isn't enough by itself. So look for people who seem generally passionate about what you're doing. To do that, you really need to start forming a relationship before you ask for the deeper mentor relationship. In the best case, it happens naturally.

Update: check out the follow-up post on getting mentors.

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