The startup bug has bitten India and the country is well on its way to become the next global innovation hub like Silicon Valley. Already the third largest startup ecosystem in the world, India has a thriving pool of 49K startups. Hungry to create the next big thing, thousands more are joining the wave every year. But most startups cannot cope with the frenzy of fund-raising, securing deals and acquiring customers; 90% of Indian startups are failing in the first five years.
That’s a sobering thought.
According to an IBM Oxford study, venture capitalists believe that the primary reason for startup failure is inexperienced leadership. An HBR study found that most high-growth startups are founded by entrepreneurs in the age group of 40-49. In fact your chances of starting a successful business double when you are 40 years old as compared to when you are 25.
So what’s age got to do with it? Is it really just a number?
Well for one, numbers don’t lie. While it’s great to hear stories of energetic young founders just out of IITs and IIMs creating million-dollar businesses; they are blips in the larger picture. There is so much more potential in the broader Indian startup scene, where startups are failing due to lack of mentoring. So how can that change?
Mentoring – The Secret Sauce To Startup Success
The life of a startup founder is not easy, they are constantly juggling to keep them afloat. There are many decision points that could be a turning point in your journey and the future of your venture hangs in balance. It’s in times such as these that experienced mentors can be invaluable. Mentors can help get the right talent on board, find the right investors, determine your company’s worth, or help lay the foundations of the company culture.
The role of a mentor is to guide the founder and help them figure out the right way forward. There are of course different ways of accomplishing this goal.
Sharing Their Experiences
Mentors already know the ins and outs of their domain, and learning from them can help founders navigate uncertain waters. They bring in a sense of direction and balance when things go rough and help hassled entrepreneurs retain their sanity. They can help spot new opportunities and broaden the venture’s horizons by bringing in new perspectives, simply because of the experience they can fall back on. Mo Syed showed Xeno’s Pranav Ahuja how much the startup still didn’t know about their customers and how they could rectify that.
Saving Startups From Making Expensive Mistakes
An experienced mentor is sometimes the only one who can guide you away from potentially disastrous situations, because of the nature of the mentor-founder relationship. With no vested interest, mentors can look at your business objectively. They will tell you things no one else will, even if it hurts. Prasoon Gupta, cofounder of Sattviko, says his mentor Raman Roy’s advice was invaluable when he was looking for funding. Desperate to get investors, Gupta was willing to give away a lot of stake. It was Roy’s guidance that helped him evaluate the background of the right investors and use equity judiciously to get them on board.
Mentors help entrepreneurs not only in the professional realm but also in their personal lives. In the digital era it’s really difficult to draw boundaries between life and work. A good mentor will be able to help you find that delicate balance and prevent imbalance. They will also help you craft your story and tell it better like Francis Goodenday did for Xeno’s Ahuja. With Goodenday’s help Ahuja was able to tell his story 100x better.
Giving Access To Their Network And Resources
Founders get easy access to the network your mentor has built up over the years. That means more leads, more partnerships, and more avenues for guidance and funding. For instance, Dell meets startups in different forums to give them go to market and technical advice. For startups building solutions around smart cities, they are engaging in advice related to AI and ML.
Mentors also do the critical job of keeping founders focussed on their goals by tracking progress and achievements. They are intrepid enough to ask incisive questions and keep the founders grounded in reality.
Choosing The Right Mentor
Good mentors can really help scale and grow a business. While mentors can open up a lot of doors, it’s important to remember that their role is that of a coach and a guide. They cannot be held accountable for the actions of founders, even if it’s based on their advice. So it becomes doubly important to ensure you find a mentor that can guide you right and true and one who is the right fit for your personality.
Many first-time founders make the mistake of chasing celebrity mentors. While they do bring a lot to the table, it’s not necessary they are the right fit for your needs. Founders must do extensive research before signing on a mentor, because the relationship is more than temporary. The decision could be based on how closely the mentor candidate’s aspirations match the company’s vision, or if they are responsive enough to the startup’s need, and their track record with other startups on their growth journey. Lastly, it’s also about a personal dynamic between the founder and mentor.
The first step in finding the right mentor is to ask what is it that you want a mentor to help with. “I help structuring my ESOP plan”, “I need to create employee policies that will help me attract and retain the right talent”, “I need to find out the best technology investments for my business”. A concrete question that the mentor can answer for you will help narrow down the list considerably.
Also, when the reason is clear, approaching multiple mentors for their specific expertise area becomes easier. For instance, if B2C go-to-market strategies what you need support with, Amuleekh Singh of Chai Point could be a great mentor to have on board given his track record on the matter. For guidance on UI and user experience, Jay Dutta of MakeMyTrip would bring great value.
It’s important to find at least one mentor that you can connect with beyond the initial need i.e. someone you can relate to on a personal level and turn to for help with situations outside work too. This happens when instead of asking for mentoring, the relationship evolves organically and gradually through discussions and bonding.
Finally, while conventionally mentorship has been a paid engagement (often in the form of equity), many experts suggest going for a mentor who’s in it without any strings attached as a way of paying it forward. That is when they will be able to offer you the needed objectivity. For some founders, however, having a mentor who has some skin in the game is a comfort factor. How you structure the terms of mentoring depends on the agreement you reach with the mentor:
- Don’t go looking for celebrity mentors. Find one who is a good fit
- Have specific questions/ problems that the mentor can help you with
- Find multiple mentors based on their expertise in specific areas
- Let the relationship grow organically
- Don’t stick to paid consulting models
Case In Point – The Technology Advisory
Technology is a key enabler for any business today. It’s impossible for startups to scale quickly and economically without investing in the right tech. Technology provides the much-needed connectivity, helps manage teams and projects, allows founders to do things better and faster, even with limited resources.
However, not all startup founders are well-versed in technology. The role of a technology mentor would be to guide them on choosing the right tech, budgeting for it, and scaling it as the company grows while keeping in mind the security aspects.
Every business has unique hardware and software needs. The plethora of choices available makes it difficult for founders to choose what works best for their business. That’s why many corporations are working directly with startups to fill this gap. Dell is one of the multinational brands powering initiatives that help startups engage with the right mentors for their business needs. While Dell does not take the accelerator approach, they work with partners to help startup founders pitch their ideas and get the right technology in place.
Over the years Dell has partnered with organisations such as the National Science and Technology Entrepreneurship Development Board to coach entrepreneurs and give them new perspectives on running a business facilitated by technology. The Dell Small Business Solution Centre has also become a hub for SMB entrepreneurs to seek technology related advice and solutions. Dell has also focused on programs specific to women entrepreneurs – such as the Dell Women’s Entrepreneur Network – to give them access to networks, capital, knowledge, and technology.
For incubation programs in India, the mentor-to-startup ratio is low and even then mentoring is mostly localised to metro cities. Getting access to an already overbooked mentor’s time is a difficult proposition for a startup. Given the voluntary nature of mentoring in India, and not enough attention from already established companies in supporting budding startups, the challenges become even steeper.
The support system for Indian startups, comprised of incubators, accelerators, and government programmes, has been growing leaps and bounds in the past decade. The efforts to build structured mentoring programs are starting to pay off as evidenced in many Indian startups. While the Indian startup ecosystem is on course to become one of the most innovative startup hubs in the world, it would definitely need tighter bonds and an open dynamic between founders and mentors, which has been a hallmark of Silicon Valley.