The excellent book “Venture Deals” by Brad Feld, Jason Mendelson gives a ton of great advice, one nugget you should know is smart Entrepreneurs, even experienced ones like me, get a stable of experienced mentors.
Here’s their specific advice:
These mentors can be hugely useful in any financing, especially if they know the VCs involved.
We like to refer to these folks as mentors instead of advisers since the word adviser often implies that there is some sort of fee agreement with the company. It’s unusual for a company, especially an early stage one, to have a fee arrangement with an adviser around a financing.
Nonetheless, there are advisers who prey on entrepreneurs by showing up, offering to help raise money, and then asking for compensation by taking a cut of the deal. There are even some bold advisers who ask for a retainer relationship to help out. We encourage early stage entrepreneurs to stay away from these advisers.
In contrast, mentors help the entrepreneurs, especially early stage ones, because someone once helped them. Many mentors end up being early angel investors in companies or get a small equity grant for serving on the board of directors or board of advisers, but they rarely ask for anything up front.
While having mentors is never required, we strongly encourage entrepreneurs to find them, work with them, and build long-term relationships with them.
The benefits are enormous and often surprising. Most great mentors we know do it because they enjoy it. When this is the motivation, you often see some great relationships develop. The Entrepreneur’s Perspective Mentors are great.
There’s no reason not to give someone a small success fee if they truly help you raise money (random email introductions to a VC they met once at a cocktail party don’t count). Sometimes it will make sense to compensate mentors with options as long as you have some control over the vesting of the options based on your satisfaction with the mentor’s performance as an ongoing adviser.
Carmine Gallo of Entrepreneur Magazine posted an interesting article, here is a summary of what she thought of Steve’s key success factors:
Thanks for coming to the workshop: Are you an Entrepreneur?, below are the slides for the first session in pdf format.
I look forward to seeing you at another Workshop or event and wish you all the best with your entrepreneurial or new career plans.
P.S. If you want to do me a favor (contribution) please donate to the Grameen Foundation via purchase of the book, OR if you have done that please rate the book on Amazon.
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Rating is very important as it helps raise awareness of the book and more people buy!
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They covered the ‘Are You An Entrepreneur?’ E-Week Workshop hosted by AIMS, a Stanford postdoctoral entrepreneurship group.
Here’s a summary of their post…
AIMS member, Hyejun Ra (co-president), introduced the event and the two speakers, Eaton and John Gillespie-Brown, a CEO Founder of several companies, angel investor and a mentor at Stanford Engineering and Business Schools, who discussed qualities that make entrepreneurs successful and debunked common myths about entrepreneurs.
“This is a two-part workshop, and tonight our main objective was to lay the foundation. What is entrepreneurship?” Eaton said in an interview after the event. “What are some of the common success traits of entrepreneurship, and what are some of the personalities that have been successful in entrepreneurship?”
The workshop series is intended to help attendees determine whether or not they are entrepreneurs and if they are, how they capitalize on their skills and the resources available to them, Gillespie-Brown said.
Gillespie-Brown opened his talk by discussing why it is critical that entrepreneurs consistently engage in philanthropy and giving.
“Contribution is critical to thinking about the start of a business,” he said, adding that leaders in a company must be supportive of their co-workers, team focused and conscious of the needs of their customers as well as the community at large.