It is common wisdom that behind every great leader is a suite of great mentors and advisors. Steve Jobs had Ed Woolard and John Sculley, Bill Gates considers Warren Buffet a mentor, and Bob Iger credits his former boss Tom Murphy not only with his success at Walt Disney, but also for having inspired the mentorship program Iger introduced that pairs top Disney executives with leading tech start-up CEOs. While most entrepreneurs don’t have world famous executives mentoring them, the importance of such interactions is obvious. According to an analysis conducted by Endeavor, a nonprofit organization that supports high-impact entrepreneurs across the world, companies whose founders have been mentored by a top-performing entrepreneur are three times more likely to go on to become top performers themselves.
However, connecting with mentors is important for everyday entrepreneurs as well. Kabbage, Inc., a global financial services, technology and data platform, recently surveyed more than 200 small business owners throughout the U.S. to evaluate the importance of mentorship for this group. Their findings prove the point:
- Only 22 percent of small businesses had mentors when they started their business. Another 17 percent indicated they have or had an advisor, possibly a paid relationship for consulting and advice. This leaves 63 percent of business owners who do not have professional guidance at the onset of their business.
- The statistics for new business failure are dire: 20 percent of small businesses fail in their first year, 30 percent of small businesses fail in their second year, and 50 percent of small businesses fail after five years when their financing or enthusiasm, or both, dry up.
- 92 percent of small business owners agree that mentors have a direct impact on the growth and survival of their business. A separate previous Kabbage report revealed 84 percent of small businesses reach profitability in the first four years of their business, with 68 percent attaining profitability in the first year. The early years of any business are therefore a crucial make-or-break period, and business mentors are vital to their success.
- Of all respondents, 89 percent of small business owners who didn’t have a mentor wish that they did. These statistics highlight a need in the entrepreneurial community to find and connect with qualified mentors who can deliver solid advice to help a business over those shaky first years.
- The good news is that even those who were not mentored themselves are taking steps to help the next generation. The study shows that 61 percent of current small business owners mentor others, and 58 percent specifically mentor younger entrepreneurs, particularly in real estate, property management and construction.
“A great mentor is someone who offers objective advice, provides counsel from a fresh perspective, is willing to collaborate, listen and learn, as well as helping you stay focused on your goals, your purpose and what you’re working so hard to achieve,” notes Amy Zimmerman, head of people operations at Kabbage. “Businesses have a great opportunity to provide everyone in their company the benefit of mentorship — from the founders to the interns. The data shows such mentorship can be critical for success. We offer this perk at Kabbage and have seen great success with it. It’s also an affordable benefit that businesses can easily leverage.”
If you have not found a mentor for your growing business, it’s not too late. Shelcy Joseph recently wrote an article entitled: “The Five Secrets to Finding the Perfect Mentor.” I would add that you can look for more than one mentor, depending on your needs, as expertise in a specialty area may prove just as valuable to you as a general business ‘know how.’
There are organizations the help business owners secure a mentor. SCORE, with over 13,000 volunteer mentors, has been helping new entrepreneurs for over 50 years with free business mentoring and education. SCORE “is dedicated to helping connect mentors — most often highly-experienced retirees who volunteer their time — with executives in need.” Another resource is MENTOR. “MENTOR fuels the quantity and quality of mentoring relationships for the world’s young people while closing the mentoring gap.”
In reality, finding an appropriate mentor is not as problematic as recognizing the need for their guidance. If you don’t already have one – now is a good time to reach out.