by Riki Markowitz
When you look at some of the biggest challenges small business owners (SBOs) face today, from how to get a loan to navigating regulations and structuring partnerships, one challenge is often left off the list: many entrepreneurs lack experience. It’s not necessarily a bad thing. At some point, everybody is new at something. But it begs the question, why do so few SBOs get a mentor? Maybe if entrepreneurs knew how much a mentor can increase their chances of running a profitable business, more of them would be open to such a relationship.
After The UPS Store surveyed nearly 200 small business owners about their experience with mentorship, the company felt justified in confirming the importance of such relationships. According to a 2014 press release, “70 percent of small business owners that receive mentoring survive for five years or more, double the rate of those who do not receive mentoring.” About 6 in 10 entrepreneurs don’t have “professional guidance” when they start a new business; but nearly 90 percent wish they did, reports Kabbage, Inc., a financial technology company owned by American Express. Professional guidance can mean an unpaid counselor or a paid consultant.
These results highlight the need for more education about mentorships in the entrepreneur community, and also more information about finding the right mentor. So we spoke with certified business mentor, Dr. Alan Hulme-Lowe, to try to understand how SBOs can find a mentor and how to know when you’ve found the right person.
How would you define the role of a business mentor?
It’s a person experienced in business who is able to offer advice based on their experience. For example, someone who can look ahead and anticipate issues that can be avoided. What it is not is an unpaid consultant. An advisor advises you what work you should do. It may be as simple as discussing that “loan” Uncle Bill gave you to get going. Is it a loan? When is the loan due to be repaid? With what interest and when? Or does Uncle Bill think he owns half the company? Whatever it is, is it documented in an agreement for when the inevitable difference of views comes about?
Are you supposed to interview mentor candidates?
Absolutely one should try out mentors! It’s a personal relationship based on trust. So that person-to-person connection has to happen for the relationship to be successful.
What would you say to someone who has had a bad experience with mentorship? Like if an SBO felt she received bad advice, or a mentor gave too little of their time.
Unfortunately, it’s not uncommon to find people who feel a previous mentor did not serve them in some way. I think it’s because people engage with mentors who are fundamentally unsuitable for their needs. For example, mentoring a restaurant business is very different from mentoring a tech startup. Each needs a different set of experiences and focus. It reinforces the importance of talking to a couple of mentors before settling on one.
In your experience, do some entrepreneurs view having a mentor, or needing one, as a weakness?
I have never seen this set of circumstances. People who have made the commitment to find a mentor are usually very open to advice.
What is a mentor/mentee relationship like?
Business mentoring is a personal relationship that requires trust, confidentiality and honesty from both sides. The relationship often lasts years.
What are some of the most common small business problems you work on with mentees?
During business formation, it’s very common to discuss the type of entity that should be formed and the need (or not) for professional help with legal, accounting and insurance issues. I work mainly with tech startups, so I’m usually very involved in defining a minimum viable product, prepping a pitch deck, discussing an IP strategy and funding. For more traditional businesses a mentor might be involved in accounting, cost control, pricing, leases, business plans, marketing and HR decisions.
What are some realistic expectations mentees should have going into this type of business relationship?
They should not expect the mentor to be able to come up with magic solutions. If they cannot get a loan, a mentor is unlikely to be able to change that. If they have constructed a partnership that is unfair — or more likely too loosely defined or taken money without an agreement, as noted above with Uncle Bill — I can advise but it will be very difficult to fix. Unfortunately, these things often happen very early in the gestation of a business, before there is a mentor on the scene.
How does one know if they’re ready or qualified to be a mentor?
You can only try it and see. But anyone who’s interested in being a mentor should have a look at the bios of existing SCORE mentors and assess how he or she compares. My advice is to bias your research toward experience, not academics.
Where are some places people can find a mentor?
I volunteer for SCORE, which is a Small Business Association (SBA) supported, no-cost, confidential, one-on-one business mentoring service. It’s also the largest supplier of small company mentors. Most cities have a chapter. There’s also the local chamber of commerce. For more established companies, one that’s operating but needing to increase profitability or growth, try the SBA in your area. They’re a great resource, especially for banking and financial issues. Tech startups could also try tech incubators. Many have volunteer mentors.
Here are a few organizations that match mentors with small business owners.
SCORE is the country’s largest network for volunteer small business mentors, with more than 320 chapters across the nation. “In addition to meeting in person, you can use easy face-to-face video technologies to connect directly with an experienced SCORE mentor.” The non-profit organization boasts providing mentorship to more than 11 million entrepreneurs. SCORE is a partner of the U.S. Small Business Administration (SBA). They also offer free online workshops and local chapters hold free and low-cost events.
Small Business Association
The Small Business Association (SBA) district offices partner with local organizations, like the Small Business Development Center (SMDC), the Veteran’s Business Outreach Center and the Women’s Business Center, to mentor and counsel entrepreneurs. Find assistance in your local community here.
Office of Veterans Business Development
The Office of Veterans Business Development (VBOC) is a resource offered by the Small Business Association. Veterans, National Guard and Reserve members, plus transitioning service members and military spouses who are entrepreneurs or interested in launching a small business can get assistance from the Veterans Business Development Center. The VBOC serves as a liaison with the veteran business community and provides business training, counseling and resource referrals for female and disabled veterans and veterans seeking grant opportunities.
The Association of Women’s Business Centers
This is a network of more than 100 Women’s Business Centers (WBC) across the nation. Each year, the non-profit organization provides mentoring and business development assistance to more than 150,000 female entrepreneurs, including those who are socially and economically challenged. “The AWBC works to secure economic justice and entrepreneurial opportunities for women.” Locate local WBC chapters here.
The Minority Business Development Agency
The Minority Business Development Agency (MBDA), as part of the U.S. Department of Commerce, is dedicated to providing mentoring services to minority-owned businesses. The organization has offices in areas with the high concentrations of minority populations and minority business owners. Find a local MBDA Business Center here.