This Firm Offers Startups Mentorship For a Fee, Not an Equity Stake Knowledge powerhouse GLG just turned the startup mentorship model on its head, but small potatoes need not apply. Here's the inside scoop.
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An unlimited, nourishing drip of high-level expert insider business advice, without having to hand over chunk of equity. That's what the mentorship and data analysis powerhouse Gerson Lehrman Group (GLG) is now offering new companies in a move that could shake up how startups get their big break.
Small potatoes need not apply. The "strongest candidates" for the mentorship-on-demand service, called GLG Share, are "innovative companies, serving large markets, experiencing overwhelming growth," it says on the initiative's website. There's also another big caveat to hurdle: Applicants should have "up to $30 million in annual revenues." (About that "up to" part, we just confirmed that it covers $0 to up to $30 million.)
Nestling under GLG Share's guiding wing -- if you make the cut -- isn't free, but it's affordable, especially if you're already pulling "up to" several million. The cost to participating startups is $12,500 for a six-month subscription to the "outsourced advisory board"-style program and $25,000 for a year-long run.
GLG's one-year fee is on par with the cost of enrolling in 500 Startups, a popular Mountain View, Calif.-based incubator program that recently announced it will charge its Spring 2014 companies $25,000 each.
Most accelerators and incubators, including 500 Startups, Y Combinator and Techstars, offer a modest initial seed investment, along with vital concept-to-launch resources such as mentoring, networking, training and media exposure. They typically also take a six to seven percent equity stake, something the innovative GLG Share initiative notably does not.
What the competitive GLG program instead connects participating startups with is a dedicated advisor from its network of some 375,000 experts, many of whom are "ex-top-tier" strategy consultants and C-level operating executives from Fortune 500 companies. GLG Share advisors span a wide spectrum of industries including technology, telecom, health care, finance, energy and mining. Several doctors, scientists, academics, and policy, legal and regulatory leaders are also taking part.
Once accepted, GLG Share clients work with a "research manager" to decide which expert is best for them to consult with. They are welcome to ask their mentor "whatever questions" they have, with no limit to the number they can throw at them.
GLG says it aims to provide participants with answers that help can help them make "more informed business decisions, penetrate new sales channels and assess partners and prospects."
We caught up with Prabhdeep Singh, head of GLG Labs, for more details on the pioneering program. Here's what he told us today:
Entrepreneur: In a simple terms, how does GLG Share work? GLG Share pairs founders at startups with GLG's network of over 375,000 experienced professionals to help them tackle their biggest strategic and operational challenges -- whether they concern market sizing, product design, pricing and sales strategy, operational improvement, or almost literally any other matter -- usually within 48 hours. Our experts cover every industry and geography.
Entrepreneur: Can you share some tips for boosting one's chance of acceptance into the program? GLG's mission is to transform the way top professionals – including those in the startup world – share expertise, learn, and make decisions. So we are looking for curious and thoughtful founders who are pursuing disruptive ideas in big addressable markets.
Entrepreneur: Why should startups opt for GLG Share over popular incubators and accelerators such as 500 Startups and TechStars? I don't think it's an either-or -- both can add a lot of value to startups. Incubators are great for mentorship and venture financing. But founders have tons of really specific business challenges every day that they can't solve on their own or through their networks. GLG Share connects them with professionals -- throughout the world -- who've actually solved these challenges, helping the founders increase their chances of getting to the right answer and accelerating growth.
Entrepreneur: The GLG Share program pairs companies with C-level experts, including scientists, academics, journalists, doctors, and others. Of those, how many are considered experts at launching startups? What special expertise do they have when it comes to entrepreneurship? There are plenty of entrepreneurs in the councils, many of whom have launched and scaled startups to IPO or acquisition.
Lots of startups focus on the enterprise market. GLG Share can connect them with senior enterprise executives who can provide targeted advice on their go-to-market strategies. We also see lots of entrepreneurs entering highly regulated markets (e.g., health care, financial services, hospitality, and transportation), with little understanding of how to navigate them. We connect them to experienced regulatory experts who can guide them through the regulatory challenges.
Entrepreneur: Are mentors within GLG Share's expert pool compensated for sharing their time and expertise? Our council members are happy to consult with our Share members gratis because they love to learn about and work with innovative startups pursuing disruptive ideas.
In some instances these council members continue to work with these startups as full time advisors, board members, customer, and even team members.
Entrepreneur: What overall impact do you think GLG Share and its top-level-advice-for-a-fee paradigm will have on the startup community? Founders have really hard jobs. They are faced with impossible-to-predict business challenges and questions every day, and have very little time to dedicate to learning. GLG Share is a new model for professional learning – for the C-suite and for startups. Startups can get on-demand help from other professionals who have solved precisely those challenges and answered precisely those questions. This allows founders to execute more efficiently and more confidently to accelerate growth.
Entrepreneur: Once the best-fit GLG Share research manager is selected, how will the GLG Share client interact with their assigned expert? By email? IM? Phone? In-person? Each Share member is assigned a dedicated GLG research manager, who becomes in effect, an extension of their team. That research manager is charged with understanding the company's biggest challenges and needs and then facilitating as many connections to the GLG network as needed. The research manager will interact with the GLG Share member however the member prefers.
Entrepreneur: What are some common challenges that GLG Share experts can really help startups tackle most? Business plans? Budgets? Competitor analysis? Press outreach? Product rollout strategy? We can help an entrepreneur answer virtually any question. But, since launch, we've seen Share members talk to Council Members frequently about product design, customer acquisition, market entry (especially internationally), pricing, and regulatory challenges.
We had a group of beta users that we started working with September 1st of last year and we publicly launched last week (March 13).GLG was once a startup, so we know what that experience is like. Including the importance of managing cash flow. With GLG Share, we have made the first two months of membership risk free. Accepted members can cancel any time in the first two months at no cost. Our goal is for startups to know that there is value in GLG Share before they pay us anything.