The Importance of Business Mentorship

Experience can be a very harsh teacher. That’s why many of the most successful people have a strong ability to learn from the mistakes of others. But there is only so much that entrepreneurs can glean by reading advice columns or biographies of great figures in their industry. One of the best ways to bridge the often-perilous gap between book learning and lived experience is through a business mentor.

Most super-successful businesspeople had a strong mentor

Warren Buffett, Steve Jobs, Larry Page, Sergei Brin and Mark Zuckerberg all have towering success in common. But they also have something else in common: Each one benefited immensely from having great business mentors to help them through their early years as entrepreneurs.

By some estimates, up to 80 percent of the country’s most successful entrepreneurs credit their success to having enjoyed access to great business mentors early on in their careers. Another survey found that 93 percent of executives with startup companies viewed mentorship as an absolute necessity.

There is convincing research that mentorship also has a huge effect on whether a company will make it to the five-year mark. Small Business Association research has indicated that companies that are run by executives who had early access in their startup careers to a quality mentor are 40 percent more likely to still be around five years after their founding.

Clearly, being able to tap into the deep experience of someone who has been through the mill is an invaluable asset to a new entrepreneur, who will often be operating in a trap-strewn landscape that is littered with the carcasses of defunct startups. And often in business, the biggest mistakes are those of omission. The expert eyes of someone who has been there and done that can help new entrepreneurs spot and seize every opportunity that comes their way.

The best things in entrepreneurial life are free

The great thing is that business mentors, unlike coaches and consultants, don’t cost a thing. They don’t have any ulterior motives and are not trying to sell you an expensive course or garner more publicity for their upcoming book. They are real people with a genuine interest in helping new entrepreneurs succeed.

But this raises the question? Who are these selfless teachers, and where can one be found?

While there are groups that provide personal business mentoring, such as SCORE, many entrepreneurs who have benefitted from mentoring will tell you that they never went far out of their way to find the people who would help them go on to greatness. Most of the time, these wise and experienced individuals were already right in front of their nose, hiding in plain sight.

Key benefits that accrue from being mentored

While mentoring can help you avoid critical business mistakes, including missing big opportunities, it can also help in a broad range of other important areas, including:

• Expanding your network of high-level business contacts.
  
• Having an expert directly give you advice that is tailored specifically to your business’ circumstances rather than generic advice from a book.
  
• Increasing your company’s chance of long-term success by manoeuvring around pitfalls before they have the chance to trip you up.
  
• Boosting your confidence. High levels of self-assuredness have been shown to be critically linked to entrepreneurial success.
  
• Helping to encourage you when things are tough.
  
• Giving you key management insights and the wherewithal to deal effectively with stressful management situations.

Examples of strong mentoring benefits from the real world

One way we can tell that mentoring truly is a major component of entrepreneurial success is that we don’t have to look very hard to find examples where it had a definitive effect on a major entrepreneurial figure’s career.

Take, for example, Warren Buffett. Buffett always knew that he wanted to go into business for himself, investing in his first stocks, while still a teenager, with the earnings he had saved from a paper route. But it wasn’t until he attended college under the legendary investor Benjamin Graham that he really started to develop the sophisticated investing philosophy that would propel him to historic accomplishments in the markets.

In fact, like many burgeoning entrepreneurs, Buffet deliberately sought out Graham, choosing to attend Colombia Business School specifically so that he could study under his hero. And this turned out to be what may be the most valuable mentorship in the history of U.S. business. For the first two decades of his career, he applied, nearly without variation, the lessons that he learned in Benjamin Graham’s business classes.

This served Buffet well. By the time of his 40th birthday, he was worth the equivalent of about $200 million today. But he got far more than just fantastic wealth from paying such meticulous attention to the lessons of his teacher; he was able to put together an entire philosophy of investing that would drive all of his future results.

The critical ideas of value investing, which include the concept of viewing stocks as nothing more than claim checks on an underlying business, for which the investor should always have a significant margin of error, were almost all cribbed directly out of Graham’s classes. In fact, it can be argued that the only thing that Buffett really added to the mix was the idea that it is better to pay a reasonable price for a great business than a great price for a mediocre one.

It is not an exaggeration to say that the man who we most know as the greatest investor alive owes nearly all of his massive success to the mentoring that he received early in his career.

Other famous examples of mentorship

Another one of the richest people in America is Michael Bloomberg. Bloomberg started his career at Salomon Brothers, a bank that would later be bought by none other than Warren Buffett. Bloomberg credits his time under the bank’s president, William Salomon, as the most formative years of his life.
Bloomberg has stated without a hint of exaggeration that he learned more about business from Bill Salomon than he had during his entire time at Harvard Business School. Bloomberg was eventually able to take the lessons he learned from that mentoring and branch off to form his own company.

Today, he is worth $55 billion, making him one of the richest people in the world. Bloomberg has said that without his time under Salomon, it is unlikely that he ever would have had developed the necessary skills and confidence to form his own company.

The power of mentorship is real

So far, we’ve seen two cases where two of the most successful businesspeople in the world each unambiguously owe a great deal of their success to the critical business mentorship that they received early in their careers.

But these are not cherry-picked examples. The simple fact is that a glance down the Forbes 400 list will yield case after case of the world’s most successful business people having succeeded, in part or in whole, based on the mentoring that they received.

The question is not whether mentoring works or even whether it has been a crucial component in the success of most of the country’s top businesspeople. The answer to both those questions is resoundingly affirmative.

The real question is how each entrepreneur can find who their ideal teacher is and then take the fullest possible advantage of the knowledge that they impart. Ultimately, the answer lies in each individual.