Posted On August 16th, 2017 by Crowded Ocean
In researching our book, The Ultimate Startup Guide, we went back and interviewed a number of our founders, the bulk of whom were first-time CEOs at the time. While it’s a cliché to talk about the importance of ‘knowing what you don’t know’ (a unifying characteristic of our most successful founders), a byproduct of this humility was the importance they attached to having a mentor, both in their earliest days (brainstorming ideas the researching the market) and in their tough moments in founding and managing an early-stage startup.
Knowing what you don’t know
Mentors come in all shapes and sizes. The obvious mentor for the first-timer is a friend who’s just a few years ahead of them in the startup game, someone whose scars are fresh and on-point to what our CEO is facing. Or it can be a more established CEO—someone from their past that they admire and perhaps subconsciously (or consciously) want to emulate.
But sometimes the mentor falls a little further afield, such as the business professor who inspired them in the early going. Or the VC from a previous company who may have stepped back from the action and has time to meet and coach.
We know of one young startup CEO who uses an established organization as a critical advisor. The CEO is a member of the Young President’s Organization, a peer group and network that offers education, support and idea exchange for young company CEOs. That’s a rarity. More commonly, strategic advisors are invited into the tent based upon their past relationships with the founding team or board or specific referrals by friends-of-the-founders.
The advisor role generally resembles a part-time consultant and reports to the founder, or perhaps a board member. The typical relationship between startup and strategic advisor includes a grant of stock options to the advisor in exchange for their counsel. (See the handy FAST document noted at the end of the chapter from Founder Institute for guidelines on the amount of equity.) Advisors typically report to the CEO and often get a lot of latitude and access to the startup team, early customers and board members. And a group of advisors that include marquee names can bring a halo of early shine to a company while still in stealth and certainly through launch.
But, remember: Every advisor you retain is going to require some of your personal time, so walk before you run. Start with one, maybe two advisors. (And making time for your strategic advisor outside of the office in order to cultivate rapport and trust will pay off. But, again, that’s your precious time you are committing.) So, make sure every advisor fills a strategic gap; is a complement to you and your personal style; is well connected, accessible and available to you. Once you’re an established company and you have a number of advisors in key areas—that’s the time to bring them together as an Advisory Board. Until then, recruit and manage them individually.
Finally, don’t overlook the idea of mentors in different fields. A friend who has been a VP of Human Resources (or still is) can be a great resource in staffing (and how to fire, if it comes to that). If asked to, they can help you not just with your current situation but with developing a long-term plan in their discipline that will help you grow the company.
Bottom line: it’s great to acknowledge what you don’t know. Mentors can help you do something about filling that gap in your experience and knowledge.