I had a discussion with two entrepreneurs of a 3 year old startup in the travel space, who were looking for an advisor or mentor. They have both (along with another co-founder) run their web-based initiative for 3 years, and have done reasonably well to the point where they are starting at over 1.5 Million uniques monthly, and are actually profitable as a business. Their need for an advisor was to help them guide the next stage of the business and review their strategy for a few options to scale it to the next stage.
As a side note, I am consistently impressed by the depth of knowledge, and wisdom in most entrepreneurs (the current crop) who have started companies in the last 5 years. There are few questions that are “standard” or banal. They are more savvy about valuations, opportunities, and are seeking to actively grow their business to reach global scale, which has to be an awesome thing for all of us. Thanks to some excellent technology blogs, VC blogs, incubators, entrepreneur clubs, and many other sources of startup information, there are very few “basic hygiene” issues to ponder.
We got talking about the kind of advisor they needed. It was plain that they had they reviewed strategic options, learned about the market landscape and were clear on what the pros and cons to each strategic choice they had in front of them.
Option 1 was to go for a “business advisor”. This would be a person who was a business executive from a larger company. I got the impression very quickly that any generic “business advisor” was going to run out of things to tell them within 6 months. This person would usually give you business advice that any experienced executive, CA or lawyer can, but with less of the specifics.
Option 2 was a “seasoned been-there-done-that entrepreneur” from the eCommerce industry with a company much larger. Most of these guys are running their own businesses and would rarely have any time to advice them. Worse, I have seen a few cases where mentors deliberately dont share key operational advice in the pretext of “competitive reasons”.
Option 3 was a “startup accelerator mentor” who was possibly a semi-retired, experienced technology executive at a large organization, who I definitely felt would help, but his lack of connections in the specific industry would make him fairly limited in use.
The final option was to look for an industry expert who can in phase 1) deliberate all the pros and cons of each strategy, then in phase 2) help connect the right people to the company based on her industry expertise and phase 3) help put some metrics and systems/processes in place to ensure rapid scale. It was obvious to me that for this team, this person would be the toughest to get, but would be the one with highest value.
I personally look for 3 things in advisors:
1. Can they give me time?
2. Can they help me with operational metrics and processes, not just strategy?
3. Can they help me scale my business from my current stage to the next “logical stage”.
I dont think I would ever look for an advisor from “cradle to growth”, since they are rare, but if I could get tremendous value from an advisor for 18 months, I typically consider that person a great advisor.
What’s your opinion?
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