In advising other businesses, it’s important that I stay updated on current reports and information that could direct my recommendations and shape strategies I develop. Ewing Marion Kauffman Foundation’s recent 2018 State of Entrepreneurship has provided me with some key insights for the remainder of the year. The findings in the report come from entrepreneurs like those I help, and I believe that they are important to share and respond to in order to help startups continue to grow, even in the face of some specific concerns.
The survey found that today’s entrepreneurs are very optimistic about the current and future state of their business, including the potential to grow. Many attribute this confidence to the current economic climate. Yet, there are issues related to digital transformation processes, a lack of government support and the need for more resources. This includes the need to improve infrastructure, minimize the regulatory environment and continue improving the tax structure.
The survey also revealed that female entrepreneurs tend to struggle more during their first year of business than their male counterparts. Many noted that the challenge of leaving the confidence and financial security of their jobs to create their startups was the biggest issue. However, over time, this faded and those that have continued to build out their startups have mostly been able to survive and continue growing.
Struggling for Support
Over a quarter of black first-year startups and a quarter of Hispanic first-year startups have one or fewer business owners they can turn to for support or advice within their network. Financial support also appears to be an area where all entrepreneurs, including startups and older businesses, could use greater assistance.
There is a lack of support when it comes to understanding the basics of business setup, such as how to get payment systems and benefits for employees up and running, selecting a business structure, getting the appropriate licenses and becoming compliant with all regulations. Lack of advisory and support has even prohibited many from pursuing loans or grants that might help them continue to grow their startups and businesses during an economic environment they view as positive.
Room for Advisors
In serving as a business advisor myself, I see that there is a big opportunity for more current and retired business leaders to take on roles and fill in these gaps, providing support in the form of mentoring, networking and connections, education and strategic direction. First, you need to locate these entrepreneurs like those within this survey.
Reach out online through networking groups and share your interest in advising or mentoring any startup or company that needs help. If you participate in conferences, this is another good place to announce on stage or throughout networking at these trade shows.
Fill the Gap
Focus on an industry where you believe you can provide the type of support these entrepreneurs are seeking. Or, if you have any type of regulatory or government experience with lobbying or other connections, you could focus on this level of support. Look for the places where you can deliver the support rather than seek out a leadership role just because that’s where your experience lies. This goes beyond making a list of recommendations. Any consultant can do that.
I realized early on as an advisor that businesses didn’t necessarily need another leader — they could really benefit from an expert who could bring them up to speed on a particular area or build plans to propel the business forward. That means rolling up your sleeves and working wherever needed to help that entrepreneur. Even if you are pitching in with someone who has considerable experience, identify what they may not see and focus your assistance there. It’s a temporary position where you are filling a gap, not taking over the company.
Bring Results to the Table
Entrepreneurs are very much like the customers you seek among a consumer or business audience. They are unsure, untrusting and unaware that they may need a business advisor. That means presenting your value-add to them. Personalize what you can provide for them. Utilize past experiences and provide specific examples of what you have done in terms of various types of support. It helps to put together a list of references they can check. All this points to your capabilities and builds a case for how you can help.
Other Ways to Help
If you don’t want to go it alone as a business advisor, work as part of nonprofit or operate in conjunction with other organizations designed to help these entrepreneurs. Getting involved gives you more opportunities to build knowledge and experience across an industry or business niche. Also, it provides you with a sense of satisfaction that you are giving back or paying it forward in relation to all the support you might have received when you were in the same shoes.
For example, Techstars is an accelerator who created a nonprofit division called the Techstars Foundation to directly support minority tech entrepreneurs. They offer financial support, such as grants and scholarships. They also partner with numerous other organizations that have initiatives, programs and advisors directed at helping minority entrepreneurs. They are always seeking business experts and seasoned entrepreneurs to assist their efforts to support these entrepreneurs and work past these issues.