For some, the constant reminders of limited runway and odds being stacked against them unravel their sense of certainty and cause second guessing. Others overconfidently march forward, without paying respect to the mines hidden in their path.

A great mentor is the solution to help illuminate the path while alerting you to unforeseen dangers.

One of the few certainties in the entrepreneurial journey is that you don’t know what you don’t know. At Boxbee, we had several of the common problems that startups eventually encounter: scaling, hiring, competitive threats, etc., but we have dealt with them because they were anticipated.

The items we were blind to: our initially incorrect positioning in the market, the time it would take to actually establish operational efficiency and how our metrics would fair in the changing venture capital landscape, were anticipated from our mentors after they took an unbiased look at the business from the outside. Without them, we would not have anticipated these dangerous obstacles that could have caused the company to go under.

How to identify a mentor

Being able to accept that you will need some guidance is the first step to growing your company with certainty and an anticipation of risks.

Entrepreneurs too often try to reinvent the wheel and ignore guidance from experts. There’s a tendency to believe that a technology-enabled service or product is original and even revolutionary, when in reality, components of the problem have been solved in some way or another in the past, and there’s a mentor to help you avoid mistakes.

Logistics/supply chain-intensive companies such as FedEx and Apple have solved much of Boxbee’s logistical, supply chain and labor challenges, which is why we sought out mentors such as FedEx’s cofounder, Roger Frock, and Apple’s former vice president of the online store, Mike Janes. Both have helped us anticipate obstacles in our business model and operations.

Research related, successful organizations and find someone you respect and that fits your criteria, someone who has done what you’re going through. Identify multiple mentors, as one mentor will not have encountered all the same problems you are bound to run into.

How to approach a potential mentor

The reason many entrepreneurs miss out on having great mentors is because they are afraid to simply reach out to the person. Most people don’t do this because they’re concerned that these people are too busy and important to consistently donate time, but you’ll find that they’re flattered you’ve asked them for help and would relish at being partially responsible for your success.

Ask your mentor prospects for a meeting, whether in an office environment, over drinks or at a coffee shop. Communicate your goals for the meeting and identify some key areas in which you wish to seek their advice. Flattery will also go a long way — mention why you admire them and why you feel they would suit you as a mentor. Don’t be discouraged if someone says no to your first request. Great mentors are pursued, not found.

Questions to ask a mentor

Once you have a mentor in place, you’ll want to prepare for your first meeting so you don’t waste their time. Prepare a list of questions, topics or subject matters that would be good conversation starters and help cover what you’re hoping to learn.

Here are a few questions to get you started:

• What is the most important thing I should be doing that I’m not doing now?
• What are the critical things we need to get right?
• What are the big risks that we should anticipate?
• Do I have the right team?
• How do you spend most of your time?
• What are your most successful habits?
• Who else should I be surrounding myself with?

Pay attention

The great advice you are going to get from your mentor can come from your questions, but much of what you learn from them will be through absorption of their habits and mannerisms.

Being closely surrounded with mentors has changed how I approach all sorts of situations: what to say to the top executives to guarantee a meeting, how to build a strong network and use it regularly to strategically grow the company, how to start every day by visualizing and rehearsing events, how to constantly push everyone around me to their full potential, how to maintain confidence and cope with tremendous uncertainty and bad news.

These are not things that one learns from management books or exercises. You must surround yourself with people frequently and consistently enough to a point where you naturally absorb these behaviors.

It’s important to remember that mentors will not solve problems for you. A true mentor will cause you to ask the right questions that help you get to where you want to be and they’ll call you out when they know you’re accepting less of yourself, your vision or your team. They’ll help you frame your problem and they’ll help you check the assumptions and belief systems that are holding you back so you spend less time spinning your wheels and wasting precious capital.

So get out there, accept criticism, ask questions, absorb new habits and take business advice from seasoned vets. You’ll be thankful you did.

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Post from Entrepreneur

However, none of us knows everything about growing and managing a business. Sometimes it makes sense to seek the counsel of others, but who is right for you and your business? When selecting a consultant, follow these five simple, but important, guidelines:

1. Unimpeachable character

First and foremost, an effective consultant must be a person of the highest character. He or she must be the consummate professional. The consultant must be willing to put the best interest of the client ahead of their own.

For example, the consultant must be willing to tell clients things that they need to hear, but may not want to — even if doing so means that the consultant loses business. The consultant must care deeply about her or his clients.

2. Solid experience

A good consultant should have experience with the challenges or opportunities you and your company are facing. She or he may not know your specific company or industry, but you and your people know your company and your industry quite well, don’t you? What the consultant brings to the table is experience in addressing the types of issues you face.

3. Creative problem-solving skills

You will want the consultant you engage to be an outstanding problem solver. After all, you are hiring a consultant to help you solve problems (or take advantage of opportunities).

Marvin Bower, the patriarch of McKinsey & Company, essentially founded management consulting and in the process grew the firm from a fledgling enterprise to a global operation.

He outlined his criteria for an outstanding consultant.

“Mental equipment — the successful consultant has outstanding analytical skill and the ability to synthesize his thoughts readily in reaching conclusions,” Bower wrote. “He is a quick and effective learner — imaginative and creative.”

When choosing a consultant, make sure to hire superior problem solvers.

4. Outstanding communication skills

A good consultant should be articulate. He or she should possess unusually strong communication skills, both orally and in writing. Of course, communication is a two-way street. Perhaps more important than her or his ability to speak articulately and write eloquently is the ability to listen.

No matter how smart a consultant is, she or he won’t be able to help you improve your business until they fully understand the challenges you face. This will never happen until the consultant listens to you.

5. Excellent interpersonal skills

Simply put, for any consultant to be successful in helping your company, a trust-based relationship is going to have to develop. You will need to be comfortable revealing the intimate details of your business. The relationship between consultant and client is not unlike the relationship between a doctor and patient.

Without complete candor, the consultant will be hindered in his or her effort to help your business. Chose a consultant with whom you can develop this kind of professional relationship.

The right consultant can create tremendous value. The wrong consultant can destroy value. Following these five guidelines will help ensure that you engage the right firm or individual.

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Post from Entrepreneur

Coaches have great BS detectors that can help us learn where and how we’re lying to ourselves. They’re trained to help people grow. While most successful people work hard, had some luck and are “self-made,” all of us hit plateaus and have blind spots. Many of us have entire areas of potential that we’ve never explored or pursued. A good coach can recognize and help you address that.

Take my client, Arun Apte, CEO and founder of two bio-tech companies in India, PREMIER Biosoft and CloudLIMS.com. His businesses are growing and they are profitable. His customers share their needs with him and it allows him to address those needs and create new products, which results in even more success. Why would a guy like Arun want to hire a coach?

Get an outside perspective

“I hired a coach because I want and need accountability. I want to push myself — and that’s hard to do without someone holding me accountable,” Arun says. “I want an outside perspective. I want to learn from people who’ve helped run dozens of companies, not just two, like me. My coach has worked with hundreds of entrepreneurs over the past 15 years. He’s seen companies come and go — he knows where to look for problems and he has a knack for knowing when I’m slacking off or what I’m avoiding. It’s like hiring a secret weapon.”

Or Jeannette Bitz, chief strategist and managing principal at Engage, who says: “As a business owner, I’m focused and motivated, but I don’t always make time for strategic thinking because I’m busy serving clients.

My coach helps me take a step back and think more strategically about the business and determine how the employees and clients can best address my vision.

In one hour a week, I make significant progress on business issues and the strategies that I believe have a strong impact on the agency. It’s invaluable.”

Arun continues, “I’m often surprised by my coach’s advice and counsel. Once, when I really wanted to put in more hours, he cautioned me to think about my age and how my businesses were running and what stage of development they were in. He told me to take it easy because it’s the only time in my life that I would have the opportunity to travel and enjoy myself. He was right. I took a month off and had the time of my life. When I came back, my companies were still doing great. I’m so glad I listened to him.”

A good coach will ask you questions

Often success is elusive or simply unfamiliar — most people who experience success aren’t ready to slow down or relax because they’ve spent years building a company or a career and they habitually push themselves. A good coach can ask you questions that you wouldn’t think to ask yourself and no one else would dare ask, such as:

• What do you really want?
• What’s most important to you?
• Why are you working so hard?
• When are you going to celebrate your success and how?
• What kind of legacy do you plan to leave?
• What kind of impact do you want to make on the world?

Beyond those questions, after any successful period, it’s important to take stock, re-evaluate and decide what’s important to focus on next. With every level of success there is another level of success just beyond the horizon that requires thought, decisions and actions that a coach can help you accelerate or think through.

Athletes have relied on coaches for years to improve their games. If multi-million-dollar athletes rely on coaches to improve, why shouldn’t entrepreneurs?

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Post from Entrepreneur

When it comes to fees, the first rule in the consulting business is to be flexible. Sometimes, you’ll find a client really wants to hire you but can’t pay your entire fee. Depending on the situation, you may want to reduce your fee, either so you can get some much-needed experience or because you believe you can set yourself up for more work in the future by working cheaper now. But don’t sell yourself short; make sure you’re paid what you’re worth, since that fee sets the tone for future fee negotiations.

At the same time, don’t try to wring out the highest possible fee from your clients. You want to be fairly compensated, but if your fee is too high, you run the risk of losing the business completely.

The figure you arrive at should include compensation for your time, and compensation for your business overhead, such as travel, office expenses and so on. But when quoting a figure, leave room for some negotiation, because sometimes clients will ask you to reduce your rates by a set amount or a few percentage points to meet their budget. Just be sure you have a bottom line figure in mind when you sit down to negotiate so you know how much wiggle room you have.

When setting your rates, you have several options, including hourly rates, per-project fees and working on a retainer basis. Let’s examine each one.

Hourly fees

Consultants often calculate a project cost based on the number of hours they expect to spend on it. To figure out an appropriate hourly rate, you can either use a source like the Careers in Business website to see what consultants earn in your area, or decide how much you’d like to earn in a year and do the math to turn that figure into an hourly rate. Experienced consultants often double or triple the resulting figure to cover overhead, benefits and other expenses; It’s reasonable for a new consultant to assume billable time will be around 50 percent, so double your rate so you’ll meet your expenses.. And if you think about it, a consulting rate of $40 to $60 isn’t out of line when you consider the expertise you’re offering.

Project rates

When working on a project rate basis, a consultant normally gets a fixed amount of money for a predetermined period of time (a situation known as “work for hire”). It can be a little tricky to determine a project rate when you first start consulting because you don’t have historical information on which to base your hourly estimate. But once you figure out how many hours you think the job will take, simply multiply that figure by your hourly rate, then add 10 percent or so to cover unexpected contingencies.

Retainer basis

Working on a retainer basis gives you a set monthly fee for which you agree to be available for work for an agreed-on number of hours for your client. This kind of fee arrangement is common for computer consultants and other providers of ongoing services. While in the ideal world you’d have a dozen or so clients who hire you and pay you a hefty sum each month, don’t get your hopes up. Most companies that hire a consultant on a retainer basis have a clause in their contract that prohibits them from working for the competition.

Working and getting paid by this method certainly has its advantages. You’re guaranteed income each month, which helps with cash flow when you’re starting out in your consulting business. Some consultants actually offer a percentage reduction in their fees if a client agrees to pay a monthly retainer fee.

Bonus options

It’s common for consultants to have some type of bonus option in their client contract or letter of agreement. A bonus may be a percentage of an amount that the consultant saves a client (if the consultant’s been hired to reorganize a department or division, for example) or the amount of money acquired for a client (as in the case of fundraising, collections or grant writing). Although it’s not always possible to work out this kind of bonus deal, it never hurts to negotiate. If you do, keep in mind that the average bonus is 15 to 20 percent of the funds saved for the client or obtained for the organization.

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Post from Entrepreneur

Are they essentially unemployed or trotting the globe advising Fortune 100 CEOs on their next strategic move?

Because the term is so ambiguous and often misunderstood, starting a consulting business can be quite tricky. I find that new consultants have difficulty articulating their business proposition and that’s certainly a recipe for disaster. At the end of the day, our job as entrepreneurs is not just helping customers understand what we’re providing but more importantly helping them see why they should buy it. If they don’t easily understand your services and feel a strong urge to purchase them, you’ll have a steep uphill sales climb at best.

So, should you abandon that consulting business idea? Not so quick. Consulting, if done correctly, can be a lucrative business for entrepreneurs – it just needs to be done correctly.

Here are three major pitfalls to avoid as you plan your consulting endeavor.

Not developing your subtitle

I’ve noticed that virtually every non-fiction book title has the same format these days: short, catchy title followed by a longer, more descriptive subtitle. (For example, Tony Robbins’ “Notes From a Friend: A Quick and Simple Guide to Taking Control of Your Life”.)

Consulting businesses can often benefit from the same strategy. Telling someone that you’re a marketing consultant may sound good, but it really provides very little information and only leaves them confused.

What’s more effective is starting with your catchy title and then following up with a sentence or two that provides a vivid description of tangible services that can serve a real need for someone.

For example, “marketing consultant focused on helping small businesses promote their products and services, so they can focus on running their business.” Yes, the second version is longer and you shouldn’t blurt it out anytime anyone asks your name, but you should be prepared to share it when you’re asked to describe it.

The simple truth is the title “consultant” is virtually meaningless and should rarely be used without any additional explanation. Develop your subtitle and use it.

Providing only services without a product

The upside of service businesses is that they require little capital expenditure and barriers to entry are low. After all, if you’re essentially selling your advice, it’s fairly easy to develop a website, hang your shingle, and find yourself in business. The downside for service businesses though is that they’re often quite labor intensive. Consulting businesses relying exclusively on services can find themselves frustrated because they are:

• Exhausted by having to physically work (or bring in other labor to work) to generate revenue
• Revenue limited by their own bandwidth and the amount of services they can provide
• Having difficulty defining and distinguishing their offerings
• Having trouble selling their services, because they’re not easily understood

A great option for many consulting businesses is to develop tangible products that can not only complement and expand service offerings, but also help them better serve their clients and generate passive revenue. Typical product offerings could include webinars, e-books or other publications, training seminars or other instructional materials and templates or guides.

Instead of focusing exclusively on consulting, think early on about what complementary products you might be able to offer.

Allowing scope creep

As a hungry, new entrepreneur, you may fall victim to scope creep. If you can smell the opportunity to win some new business, it’s tempting to push your scope of services to pursue the business. But don’t do that.

A key element of scoping your services is deciding what is OUT of scope for you. This out of scope list truly sets the boundaries of your consulting services and helps you better define your business. Write an in scope/out of scope list that clearly identifies what you do and what you don’t do and stick to it

Developing a consulting business can sound simple, but it’s really anything but. Performing the consulting work may actually be the easy part. Appropriately defining and scoping your business may prove to be trickier than you think. Don’t make the mistake of underestimating the importance of establishing a strong foundation.

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Post from Entrepreneur