Almost all successful entrepreneurs can point to a handful of key mentors and advisors who have helped them along the way. Though both kinds of confidants can be vital to a fledgling business, their differences are important to distinguish, and entrepreneurs should be mindful of how to benefit from each.
Mentors tend to be more focused on you, while advisors are usually more focused on your company. As early-stage investor and entrepreneur Brad Feld puts it: âAdvisors provide services in exchange for a portion of your company, while mentors merely ask, âHow can I help you?ââ
As an entrepreneur, it can be difficult to determine how to utilize each one. Think of them as vegetables and desserts, and yes, your motherâs advice still prevails. Experienced and dedicated mentors are like vegetables, good for you so the more the better. Advisors can be incredibly helpful, but they are like desserts and require sound judgment. Reason being, advisors are compensated, which can be problematic if they donât deliver.
Hereâs a guide outlining the differences between both mentors and advisors -- or, if you prefer, peas and carrot cake:
Mentors are close friends who help you grow as an individual. The advice you seek from them will often be both professional and personal in nature. Mentors are usually older and have achieved more vocational success. The mentor/mentee relationship normally evolves organically over time, as it is rooted in friendship and affection. Mentors have no financial upside in helping you but do so for altruistic purposes. Basically, they want to see you succeed.
Like Yoda from Star Wars, mentors tend to know exactly what you need to hear when you need to hear it. They provide guidance, support, introductions and even the proverbial âpunch to the gutâ when warranted.
For example, my mentor was Mace Siegel, the co-founder and former chairman of Macerich. When I told him that I was leaving his company to start my own, he suggested that we spend even more time together in spite of my departure, knowing Iâd need his increased oversight. Mace would notoriously call me at 5:15 a.m. to make sure that I was awake and maximizing each day. He was willing to help me even though none of my newfound success would pose any financial benefit to him or his company.
Advisors are experienced professionals who become part of your company to assist in one or more areas, often providing expertise in a particular field. They are bullish on your product, market and team, while also possessing tremendous proficiency and relationships to ensure your success.
Like mentors, advisors can also be friends, but by contract, they are legally associated with your company and compensated financially (usually 0.1 percent equity and higher depending on demand). Advisors often appear on your website and are referenced in your conversations as a way of stating, âThis really accomplished person agrees with where weâre going and is committed to helping us get there.â
Because advisors are compensated financially, you have a fiduciary responsibility to maximize their value to your company. Some things to keep in mind:
- Specificity. Identify specific ways for them to help your company and write it into their scope of work. Both parties should be on the same page from the beginning.
- Range. They probably wonât possess the skill range to help in all areas and phases of your company. Plan for the right advisors at the appropriate times.
- Value. Bring on advisors who add value, don't just stick big names on your website to boast. If you donât get value out of them, itâs typically your fault, not theirs.
How to find mentors and advisors
This is an expansive topic, but the best approach is to start within your network: friends, family, coworkers, professors, etc. After assembling a wish list of ideal mentors/advisors, seek them out or get introduced through mutual connections.
If you believe someone outside of your network is absolutely critical to your success personally or professionally, go to an event that person is attending. When approaching people outside of your network, be mindful of their interests. Why should they be excited about your company?Â How can you provide value to them?
How do you balance your relationships with both mentors and advisors? Let us know with a comment.