October 18-20 | Tucson, AZ

The Research Institution GAP Fund and Accelerator Program Summit

How mentors help startups grow – and avoid costly mistakes

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October 18-20, 2023 / Tucson, AZ
The annual summit for research institution gap fund and accelerator programs, including proof of concept programs, startup accelerators, and university venture funds

The Story

When Eric Reich was starting higher education software company Campus Labs in 2001, there weren’t a lot of ways to learn and process how to grow a startup.

It made the mentors he had at the time that much more valuable.

He leaned on local executives, such as Jordan Levy and Ron Schreiber, to help from a company creation, scale and investment standpoint. He sought out other experts in the college and university market.

Eric Reich
Eric Reich, 43North’s chairman.

Mark Mulville/Buffalo News
“When you get the right mentor, you get the benefit of hearing about and learning both what to do and what not to do,” he said. “When growing your company is such a high-risk proposition and the margin of error is so small, the amount you can gain by having the right mentor has immeasurable impact.”

Two decades later, the startup scene in Buffalo is seeing substantial growth, but a similar problem remains: Mentors are not always easy to find. Buffalo is still considered a nascent entrepreneurial community that some say is starved for mentorship.

Reich knows the angst felt by today’s local entrepreneurs, so it is important to him that he looks back on his own journey to help others gain an advantage in their venture.

Mentors are critical to growing professionals throughout all workforce industries, but they have been especially important for the startup ecosystem.

Much of the growth that has occurred in this space in Western New York is thanks to the contributions of mentors and those in supporting roles to startup founders.

But, in the Buffalo area, the coordinated startup ecosystem has been around for only a little over a decade – spurred by the Buffalo Billion and creation of the 43North startup accelerator competition, so there isn’t as much talent floating around with experience in building a startup from scratch.

“Finding experienced mentors isn’t the easiest thing here,” said Richard Kim, director of startup ventures at the University at Buffalo. “There’s this giant knowledge gap, especially when you’re a first-time founder, so experienced mentors, who have been there and maybe taken their lumps and found ways to succeed once or twice, they can really help get you through the process of figuring out what the next steps for your business should be.”

Most entrepreneurs are consumed by both the opportunities they can go after and the many challenges they’ll have to tackle, said Peter Burakowski, a co-founder and former executive at HELIXintel who is now helping startups through his work with the University at Buffalo’s Business & Entrepreneur Partnerships group. That is critical, especially early on, when there is major resource constraint, most notably with cash and team bandwidth.

“It could be really difficult to sort through what to prioritize,” said Burakowski, senior associate director for startup ventures at UB. “Mentors give founders the perspective that you can’t do everything, and help them prioritize what the most important things are to help them feel good that they’re doing what they believe is right at this moment.”

Even if founders can garner funding for their big idea, there are still plenty of questions to answer. They may include: How do you invest it wisely? How do you determine when to hire? How do you choose the right market sectors to pursue for profitability and growth?”

“I can’t emphasize mentorship enough,” said Rebecca Fannin, an author and national reporter for MSNBC covering startups and tech. “You do have to have these mentors and town champions, or changemakers, as I call them, who can influence the culture and provide examples of success.”

David Reading, KeyBank’s senior vice president and senior relations manager for commercial business, has served as a mentor for about 10 years to help fill the need in this community and do his part in contributing to the region’s growth.

He was a judge and mentor during the first two years of 43North, which is embarking on its ninth competition later this year, and now serves on the board for BNMC’s Innovation Community Business Accelerator. Also, he and his wife, Stephanie Argentine, are part of the seed investment group Buffalo Angels Fund II.

“We’ve come a long way in building the ‘it takes a village’ type of support system here,” said Reading, who has been a banker for 35 years. “We’ve got to plant and water these seeds – these new companies – because they’re the future of the economic health of the region.”

Building a company is one of the hardest things to do professionally, and it becomes even more difficult when resources aren’t as available as they would be in a place like Silicon Valley, Kim said.

Despite all the challenges that come with it, small-business ownership is on the rise in the state and across the country. Between 2021 and ’22, a record 608,000 small-business applications were filed across the state, including many in Western New York. Additional funding and support opportunities for small business and startups have also helped ensure that potential local high-growth entrepreneurs, including underserved founders, can make their impact.

“We see strong demand for both mentorship and capital from the entrepreneurs who are trying to fuel our renaissance,” said Marnie LaVigne, president and CEO of Launch NY.

Annamaria Masucci, executive director of startup incubator Pitch Hamburg, is helping more entrepreneurs in the Southtowns get an opportunity to explore their business ideas, and a big part of that process is meeting with mentors.

“You can have your talent and passion, but that may not be the same as having a business sense,” Masucci said. “So, having those outside perspectives from people who have done it or worked with people who have done it is how you learn.”

While friends and family may be well intentioned, most are not qualified mentors. Without “walking the walk,” it is hard for them to understand how a founder feels, or the loneliness that can come with entrepreneurship, Burakowski said.

These days, there may also be too much information out there in blogs and books, as entrepreneurship has been romanticized in American culture and has become a desired career path, Reich said.

“There is so much information out there now that you almost need a mentor to sort through what is really important and what should be prioritized,” said Reich, a 43North board member. “Being an entrepreneur is a stressful enough experience, and one that comes with literally a hundred decisions a week.”

What the most effective mentors tackle
From figuring out customers needs, establishing initial goals, pinpointing audience obstacles and making sure there is a need for the idea in the marketplace, to pursuing markets, recruiting executives and raising venture capital or creating sustainable revenue, mentors can help founders achieve meaningful milestones in a variety of ways.

Reich said he was mentored both by people with expertise in the college and university market, and local backers prolific in tech investing who made sure that his idea and company had the best chance to be successful.

It helped him create a network of influential people – relationships that make for future allies and financial providers, he said. That could include lawyers, accountants and others who help get an idea set up on the proper path.

Mentors also help with the emotional rollercoaster and chaos that comes with being an entrepreneur. A part of that is showing empathy and making space for vulnerability.

Building trust is also crucial. Many mentors strive to build that with company founders by taking the time to ask good questions while avoiding giving directives.

Reading said he tells mentees to focus on resiliency, open mindedness and a willingness to pivot, especially after getting feedback from potential customers and partners.

But, just as important, a mentor needs to realize when they don’t know something, and that may happen more often in what is considered a young entrepreneurial community.

“There’s a point where everyone taps out on what they know,” Burakowski said. “And I think there’s a cliff you can fall off accidentally by giving advice about stuff that you don’t know.”

 

 

Full story: How mentors help startups grow – and avoid costly mistakes

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