Recently we noticed a blog from the well-established incubator programme Village Capital explaining why they no longer hold demo days.
The author, Ross Baird, points out that “I’ve never seen an investor make an investment decision, ever, as a result of a pitch”. This statement is self-evidently true. And at Cambridge Social Ventures we have never held demo days – it really doesn’t take much consideration to notice their flaws.
This got us thinking about other ‘sacred cows’ within the incubator and start-up space which we also don’t hold with. One of the most significant of these is the use of mentors.
When we started the Cambridge Social Ventures programme we took the conscious choice not to recruit a raft of mentors or run regular mentoring sessions. There are a number of reasons for this but chiefly, we weren’t convinced that unstructured mentoring programmes add value, and thought they risked being actively damaging to our nascent social entrepreneurs.
Instead, we get to know a handful of mentors really, really well, and we match them with our entrepreneurs only where we see a really close fit. This is ultimately more satisfying for the entrepreneurs and the mentors!
The business mentor archetype
There are two usual kinds of mentor that engage with incubator programmes.
The successful entrepreneur: there’s a lot of successful technology entrepreneurs-cum-angel investors who are willing to ‘give something back’. In Cambridge many of these people were directly involved with a start-up in the 90s. Many of them are super-bright and created amazing innovations. Many of them are now very wealthy.
The senior manager at a large corporate, bank or consultancy: these people tend to have brilliant, even field-leading, expertise in specific areas, the support of their employer through Corporate Social Responsibility programmes and again a desire to give something back.
The problem is that none of these characteristics necessarily mean that they are suitable mentors for contemporary ventures starting out. For instance, the former may not have started a business recently, the latter probably not ever at all. They are unlikely to know the entrepreneur’s sector as well as the entrepreneur does, and yet they are set up as ‘experts’. And it’s worth mentioning these people are nearly all white men.
The role of ego
Having a ‘stable’ of mentors associated with an incubator is considered to be an asset. Our view is that this plays well to incubators which value being publicly associated with pre-existing success but, from the programme managers’ point of view, it also involves a lot of time going out to lunch with people who’ve maybe not done much that’s really innovative for a long while, if ever, or whose main focus is property deals, for instance.
In truth, this type of mentoring can end up being about the mentor and their ego. Almost by definition the people who meet the mentor archetype and seek to get involved in this way may not be great listeners – the key element of successful mentoring. And, let’s be frank, some people who put themselves forward in this way are hugely arrogant… many of them without much to be arrogant about.
Why does it matter?
If mentors want to give their time, and it makes them feel good and builds useful relationships – particularly linking entrepreneurs with people who may have access to capital – then what’s the harm?
We have to acknowledge that there is a power dynamic between programme participants and mentors. The mentor is introduced as the more experienced person, and the introduction via the incubator adds kudos to that. So entrepreneurs tend to place undue merit on suggestions by mentors. In practice entrepreneurs can feel compelled to change course after each meeting with a different mentor, if that mentor is positioned as knowledgeable or experienced enough.
Additionally, our incubator works specifically with social entrepreneurs: people building ventures aimed at creating positive social and environmental impact. Unsurprisingly they are frequently inundated with offers of help. These offers often really do help make ventures fly, but there’s a real risk with social entrepreneurs that everyone wants to be associated with to somehow contribute to their story. They end up with many mentors, advisers and hangers-on, and spend less time and energy on actually building their venture.
Getting the best from mentors
As in most things, a bit of honesty helps to create the most value from a relationship between incubators and mentors. Ditching the pretence that somehow one individual’s skills base is useful and relevant to a whole range of start-up ventures, and that unstructured, random, 30 minute meetings are an efficient way to lead to anything useful, is a start.
This isn’t to say we don’t value our relationships with many successful local entrepreneurs, angels and corporate supporters. Or that we don’t like going out to lunch!
We use a team of experienced people internally who support our entrepreneurs through their growth journey. Our view is that a coherent overview of a critical path is essential and this means having an internal adviser working with each venture and helping them move along that path, with this process being tracked rigorously by internal systems.
For mentors who approach us with offers of help, we don’t rush in blindly. Only when there’s a clear match between a potential mentor and a venture will we make an intro. This way the mentors are actually using their key skills, and the entrepreneurs have fewer, higher quality interactions with expert advisors.
Our experience is that this is more effective and impactful, and ultimately more satisfying all round than unstructured, unobserved, unmeasurable mentoring.
P.S. We also support solo entrepreneurs through our programme – the focus on ‘teams only’ is a holy cow we can address on another day.