One of my most challenging activities is providing mentoring to people who have just sold their companies.
They have gone from poor to rich in an instant, and the euphoria of the transaction has now been replaced with a distinct sense of anti-climax. Some of their friends, driven by envy, now dislike them; others are bombarding them with suggestions for investments or charitable causes. The result is fatigue, often allied with a vague sense of guilt.
My advice is always to not invest in anything in the short term and instead take a very long holiday. They should spend their new free time looking inwards at the person they have become and try to come to terms with their new position in society.
Many entrepreneurs feel the need to start a new venture right away, to prove they can do it again. This can be a big mistake, as they are often still damaged by the experience of the sale, a process often compared with suffering bereavement.
If they survive the process unscathed with a good perspective on their own weaknesses as well as their successes, then they have the raw material to become a mentor themselves. If this is of interest and they feel that they would enjoy the process, I then provide them with some practical tools.
I believe that mentoring should always be for free. It is entirely legitimate to charge for advice, but that is consultancy, a completely different business model, whose value for money should always be precisely measured. I believe strongly that mentoring should always be given without any expectation of financial reward, and therefore unbiased by any commercial considerations.
I have developed a precise system that seems to work well. I offer free one-hour sessions at short notice in a Central London location, filling in gaps between my other, paid work.
I ask the person being mentored to first read The Beermat Entrepreneur, so they have an understanding of my model and do not require me to regurgitate large sections of the book.
I then ask them to invest $100 in their own personal development and complete an on-line psychometric test specifically designed for entrepreneurs, called Wealth Dynamics, devised by my good friend and social entrepreneur Roger Hamilton.
The Wealth Dynamics system helps me get a clear insight into their potential and personality, based on their match with the eight different profiles. (Memo to any cynics – no, I don’t get any kickback from the Wealth Dynamics people. I genuinely believe this is a great self- understanding tool.)
Finally, I ask them to provide just one page on where they are and where they want to get to, rather than a detailed business plan or sheaves of marketing material. Some people sadly cannot summon the discipline to generate a concise one-pager, which probably means they are unlikely to make a successful career from entrepreneurship, at least for now.
Those who do the preparation correctly then get a totally focused hour of my time, and simple suggestions for the next steps they should take, as well as a promise to see them again if they pass this next small hurdle. They all seem to enjoy the process, as do I.
The key to successful mentoring is that it should be fun and a learning experience for both parties. As actor Kevin Spacey said, “When you have success, it’s great to be able to send the elevator down for somebody else”.
This article is a chapter from ‘This Is How Yoodoo It’ – a collection of Financial Times columns written by Mike Southon. You can buy this book in hard copy and in Kindle version here: http://tinyurl.com/YoodooBook