I have recently written a blog piece about the growing trend of self-professed 'mentors' in the start-up world. And it has generated a lot of feedback from friends in the start-up community, saying how much it has struck a chord with them. Interestingly, we often receive the suggestion that Viedea should start a YCombinator type of start-up accelerator model adapted for India (for those of you not familiar with it, YC developed a model of making a small-seed investment and then working closely with founders over an intense 3-month boot camp; check it out at http://ycombinator.com/).
On the face of it, this makes a lot of sense. We are probably the only advisory firm in India focused exclusively on the VC ecosystem; we understand what it takes to 'dress up' a firm for funding and all our team members have entrepreneurial, as well as operating experience. We have spent a lot of time thinking about the mentoring/incubation issue and continue to shy away from it. Then I thought I would share a few ideas on what would make a start-up accelerator work (and perhaps these are the reasons why we don't start one.
Rock stars & hackers: The people who have founded and/or the people who provide mentorship at the most successful start-up accelerators in the world YC, Techstars and similar companies are bona fide rock stars. They are super successful entrepreneurs, hackers or investors. Their achievements and aura not only enable them to give great advice to entrepreneurs, but they also have the networks to open doors to investors, customers and other advisors. This quote from a YC alumnus in a New York Times article says it all: "It's like Rob De Niro wants to start an acting school. Do you want to join it? You get to work with him every week; you might even get a small little movie deal out of it at the end."
My take: You need to be a rock star to coach potential rock stars. Great successes (and great failures) along with being superbly well-networked are necessary ingredients for mentoring entrepreneurs.
Focus: Successful start-up accelerators in the USA are mostly focused on tech start-ups, and almost invariably on Internet/mobile start-ups. The YC founders are hackers themselves and take great pride in it. Mentors at these programmes have specific areas of expertise, be it marketing, product management, technology or finance.
My take: The mentoring programme cannot be one size fits all. It needs to be focused on a specific domain and the mentors on the programme need to have real skills. I attend start-up events where a lot of general fluff is dispensed in the name of mentoring. The real value to a start-up is when a mentor gives them concrete, actionable guidance to solve specific problems.
Peer mentoring: We share our office space with a start-up. We are constantly bouncing ideas off each other and sharing the learning. The energy in the space is infectious. Commenting on my previous blog on mentoring, Gautam Sinha, a good friend and founder of myfirstcheque.com, wrote about the importance of 'peer' mentors. I couldn't agree more.
My take: A well-run, shared physical space for start-ups is a great idea. Entrepreneurs will learn more from their peers than through formal advice. I would like to emphasise that this model requires a focused, highly networked and visible person or team running it for it to succeed. The Startup Center in Chennai is a great initiative and hopefully, will validate the benefits of a well-run shared space for start-ups.
Be rich before you mentor: This sounds a little frivolous, but let me explain why it is important. Of late, a lot of people seem to be getting into the mentoring business, which is great if they have the right experience, expertise, etc. However, this is a long haul business. You have got to invest all your time and energy for five years at the very least before returns (may) kick in. In the interim, there is very little income. Unless you have other sources of income, this is going to be very frustrating.
My take: If you strip it down to basics, the entrepreneurship game is all about making truckloads of money (I am already anticipating the 'higher calling' type of comments). Now why would an entrepreneur take advice on how to do this from somebody who has not made sackful of it? Ergo, be rich before you mentor!