As a startup founder there comes a time when you decide to bring on an advisor, coach, mentor, or maybe a specialized consultant to help in an area where your knowledge is limited in order to achieve an outsized outcome quickly.
It’s important, as an entrepreneur, to have a wide breadth of knowledge. But it is next to impossible to have that breadth and sufficient depth (not to mention time!) to do it all themselves.
So, many will turn to outside aid.
And while advisors, coaches, mentors, and consultants all have different roles to play, the common ground is that they have something you lack.
Specialized experience, knowledge, skills, or perspectives.
But when the time comes to select one, what criteria should you use to maximize the likelihood that you have a positive outcome and achieve your desired result?
Here are 5 Key Criteria to Look for In a Startup Coach, Advisor or Consultant
1. They possess relevant experience
There are many coaches, advisors, and consultants promising to help you achieve outsized outcomes. Many of them have the receipts to prove that they have achieved incredible results not only for themselves, but for clients who have worked with them.
But can they do that for you?
There is no 100% guarantee here but the surest bet is if they have achieved the result you are looking for in your business vertical (or one very similar) and with a client that has a similar makeup to you.
In other words, if they helped a B2C startup setup a Shopify store that contributed to them 1000x their revenue, that doesn’t necessarily translate to expertise in supporting B2B SaaS startups. It’s important to understand their industry, business model and niche of expertise.
2. You and them are compatible and can work together
Different people engage and interact in different ways. This is less of a “right/wrong” situation and much more of a personal taste situation.
Some coaches interact like they are working with a college football team, while others speak like counselors. It’s important for you to understand which type of personality you will be the most responsive to in order for the relationship to work.
The value you receive from the professional you hire will largely be determined by how well you interact.
A few questions to ask yourself before pursuing a working relationship with them:
Can you take direction from them?
Do they inspire confidence in you?
Does their communication style mesh with yours?
Do you believe in them?
All of these things are important factors to consider when making your selection and specifically help identify if you and them will be able to work together for the long haul.
3. They are excellent communicators
Beyond the style of their communication, what is the quality of their communication?
Being an effective consultant, advisor, or mentor is largely a function of translating your experience, learned and lived, into lessons that your client can implement. In order to succeed at that, one needs to be an effective communicator.
Here are some examples of what to look for:
Are they able to articulate their ideas in a way that you and your team understand?
Can they break complex ideas down into easy to understand chunks?
Do you walk away from sessions feeling like you understood the points they were trying to get across? Did your team?
Are they able to understand your business, problems, and ideas, and communicate them back to you through the lens of their experience?
4. They have a proven track record
An unfortunate truth is that there are a lot of people out there who make big promises but deliver small outcomes.
Prior to moving forward with any partnership, you’ll want to dive into figuring out what they have and have not done in their past, so you know the best way to work with them in your future. Before moving forward, you’ll want to ask them to provide you with a few references, ideally past clients and past colleagues, so you can truly understand the full scope of them as a person.
Note: Sometimes, NDAs prevent them from discussing specific clients and outcomes. However, they should still be able to provide generalized examples of the clients and the results achieved. While not as compelling as specific cases, clear and detailed examples (even without client names) can still indicate their credibility and experience.
5. Their service packaging works with what you need
Retainers, packaged offerings, hourly rates, percentages of revenue increases, percentages of equity, flat rates - there are many ways of charging for services. The billing model is less important than how it works with your use case, just make sure you do the math.
Sometimes, what seems like a great deal hides an astronomical fee when it comes time to pay those invoices.
Examples:
Do the math if you are paying a percentage of the outcome (paying a staffing firm 20% of the salary to find you a lead architect with a $250,000 salary = a $50,000 fee. That may be worth the investment, but calculate the fee into the decision)
Paying a consultant a $350/hr rate may make sense if you anticipate only needing their time for a limited number of billable hours. However, ensure that you are confident that those hours won’t exceed the overall ROI that consultant could provide for that service.
Next steps are with you
Advisors, consultants, and coaches each play a unique role for startups and the best ones provide real, lasting value to the startup community. However, like many services, both the quality and pricing can vary significantly.
By doing your research, you will increase the likelihood of walking away from the engagement with valuable insights and a positive experience.
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About the author: Gerry Gadoury is a serial entrepreneur, best-selling author of "Destination Employer," and speaker. He is the Founder of RedBeard Solutions in Dudley, MA. His hobbies include reading, writing, and hiking. You can connect with him here.
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