David Cummings on Startups

Find an Advisor with Relevant Experience

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David Cummings

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Several months ago I was talking to an entrepreneur about his startup. After hearing about their current progress and plans, I was pretty surprised by some of the decisions they had made. Now, I don’t know nearly as much as the entrepreneur does about the market or the opportunity, but some of the things they spent a significant amount of money on didn’t pass the smell test. Next, I asked about their advisors and investors. As expected, the advisors and investors were successful people that had never built a tech company.

Here are a few thoughts on finding an advisor with relevant experience:

  • Legal terms and deal structures that are common in one industry aren’t guaranteed to be common in other industries
  • Costs and expenses to get things done in a startup should be much cheaper (and scrappier) than what the advisor with the big company background is used to seeing
  • An entrepreneur that did well in the dot-com era doesn’t necessarily have the same applicability 15 years later as many strategies and tactics are different now
  • Talk to a number of potential advisors and don’t settle for the first one that’s available
  • Seek out peer mentors and not just older mentors (like EO and YPO)

Entrepreneurs would do well to find advisors with relevant experience, not just general success.

What else? What are some more thoughts on seeking advisors with relevant experience?

Comments

4 responses to “Find an Advisor with Relevant Experience”

  1. jeffm962 Avatar
    jeffm962

    I hired an advisor to help me with a few projects that I was working on but mostly for accountability to keep me on task. The irony here is that I myself do coaching/consulting but I know the value of having a “me” working with me.

    I was in a hurry and didn’t vet the person like I should have going off of credentials and success versus actual experience in what I needed help with. His stories were always 1 off about a friend who… or a colleague who… but never, this is what I did in this situation.

    Hire slow fire fast is my new mantra especially with a paid advisor!

    Reply
  2. anaatcalin Avatar
    anaatcalin

    Okay, this is such a cool topic I’m on fire and can barely gather myself to write. So, long story short – I’m a writer and a translator, but I have an MBA too, graduated in Berlin. Worked for big companies, ended up from translator to project manager. And I did notice this very big problem, especially in Germany – everybody becomes a consultant without making experience themselves. The reason I noticed is this: those who can’t do it themselves teach others how to do it (not talking about life coaches here, this is a completely different story, I mean mostly business consultants.) Yesterday my accounting and tax advisor – who helps my company with delegatios – called to ask me some questions; okay, of course, I get that; after a few of those she asks me if I did some research on how a company from this respective country is fiscally positioned in Germany. Now I just had to go sour on her – isn’t this HER job? By this I mean to illustrate that I’ve seen this is a general problem – consultants delivering the irrelevant, expecting the client to do the actual work. Do you guys have similar experiences, or do you see things differently?

    Reply
    1. cleebration Avatar
      cleebration

      consultants have only 2 objectives: maximize number of days and maximize price per day.
      that’s the reason why we have defined a consulting free zone. we only work with peofessionals working on the same side as the entrepreneur. they get stock options instead of money. over time we build a sharing and caring DNA.

      Reply
      1. anaatcalin Avatar
        anaatcalin

        This is a good approach, I think. I’m actually baffled that Germany supports this pay-per-hour kind of business. As a translator I charge per page, so if I take five hours instead of one, it’s on me. Of course the difficulty also plays a part, but that’s another story. With writing the example gets even clearer – readers pay per book, not for the hours I spent on it. Of course there are services that can only be measured in hours – for example an interpreter cannot be paid otherwise. But when the craftsman wants to charge me per hour instead of per square meter I can already see him dragging, because it’s only logical. And yet all clients in Germany pay per hour with no objection, then complain that it’s taking too long. It just makes me laugh, the problem is so obvious and yet only the fewest acknowledge it here in Germany.

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