The nature of entrepreneurship is to change the paradigm through which we view the status quo, and to improve or change things as necessary to create a successful new model.  For young entrepreneurs especially, having a mentor is important in navigating the territory between the inception of an entrepreneurial idea and making it an actuality.  What follows is a brief list of the benefits of having a mentor to guide young entrepreneurs through this process.

Share Knowledge and Experiences
Mentors can help entrepreneurs by sharing their knowledge and experiences relative to what they are currently working on.  By sharing these experiences, it helps to alleviate some of the frustrations that can be experienced when things don’t seem to be going in the right direction.  Experience in dealing with the entrepreneurial process helps to get past these obstacles and keep working on fleshing the ideas out.

Networking
Chances are the mentor will have far more colleagues and associates than the young entrepreneur.  Meeting the right people in your field of interest is essential to ultimately achieving success and will help the entrepreneur to branch out and learn about the networking process.  Building relationships with potential clients, investors and colleagues can be a determining factor in the success of an entrepreneur’s career.

Credibility
Just as a mentor can help with knowledge and experience, as well as introducing the entrepreneur to the right people, his or her reputation can also help to lend much-needed credibility to the unknown entrepreneur.  Many times, potential investors and clients want to know who you are working with and what kind of relationships you have with others.  Having someone there to vouch for you can certainly help alleviate any potential misgivings in this regard.

Success
Strangely enough, success seems to be one of those contagious things.  Surrounding yourself with successful people as an entrepreneur can help mold you into the success story you would like to be.  Mentors have a way of taking people under their wing and guiding their protégés through the process, ultimately giving them their “secret” to success in the process.

Confidence
A great mentor will be someone that gives much-needed confidence to the entrepreneur, and is also going to be the person that the entrepreneur bounces all of their ideas off of.  Learning to develop this confidence and the ability to take calculated risks will be essential in a successful entrepreneurial career.  Take advantage of the new ways your mentor will help shape you and keep the new perspectives and ideas coming.

This post was contributed by Kelly Kilpatrick, who writes on the subject of top business schools. She invites your feedback at kellykilpatrick24 at gmail dot com.

As professional investors who raise pools of capital from institutional, corporate and individual investors, venture capitalists (VCs), are a highly sought-after group. Although many early stage CEOs seek VC funding, only a select few actually get it.

For example, at a recent Northwest Entrepreneur Network breakfast meeting, Managing Director Lucinda Stewart of OVP Venture Partners explained, “OVP does about six to nine deals a year, which is whittled down from about 3,500 contacts, of which maybe 200 or so are a possible consideration and only 10 percent move on to the due-diligence stage.”

With so much at stake for both the CEO and VC firm, it’s easy to see why both have to be selective. With that in mind, Stewart shared some of the not-so-obvious decision-making that OVP and other VC firms go through when determining which businesses to fund.

What VCs are thinking:

– How big is this market? VCs want a big opportunity so they’re looking for big markets. In addition to market size, they will be assessing how open the market is. A deal becomes very exciting when it’s part of a big, open market with no entrenched leader.

– Who knows this person? If you don’t know anyone at the VC firm, then leverage a back-door contact who can recommend you. Lawyers are a great source, as is anyone the VC respects. When these sources are leveraged, a meeting is more likely. Without smart networking, a CEO is forced to send emails or cold calls, which are usually dead on arrival.

– Is this an out-of-the-box idea? VCs know that an upside in typical categories isn’t usually there. That’s why they get excited by business ideas that demonstrate break-out thinking, or doing things in a completely new way.

– Can they prove it? If an idea is innovative it’s just as critical to show a pathway to validation. Unfortunately this often presents a chicken-egg scenario. Without market validation or IP (intellectual property), a great advisory board should be assembled to reinforce concept validation. These individuals should be well-known industry veterans who can speak to VCs about why the idea has merit.

– How deep is the management team? What’s commonly seen is a technology founder without a partner. VCs want biodiversity and sales DNA on the team. If you can’t sign up partners without funding, it’s advisable to find people who will confirm that they will come on board once funding is available. Expect the VC to contact these people.

– Are the leaders experienced? VCs want a smart, focused entrepreneur who can bridge the big idea with the right background, and has a logical execution plan. This demonstrates knowledge and experience and establishes confidence with the VC. If you’re not a serial entrepreneur, the bar will be much higher.

Since most companies don’t have everything a VC firm wants, it’s important to know what a VC is willing to trade off. According to Stewart, stable management beats the smartest team. When it comes to product versus vision, product is king because it’s key to getting market feedback. It’s also important to emphasize your ability to assess and if needed, fire quickly. To a VC, that ability equates to time, and time is cash.

The secret language of VCs: Once you engage with a VC, it’s important to be able to accurately interpret VC code words so that you know where you really stand. Here are a few somewhat tongue-in-cheek interpretations of the most common VC phrases:

The VC says and (what the VC really means):

“Entrepreneurial CEO” (totally uncontrollable, bordering on maniacal)

“We work closely with management.” (We talk to them on the phone once a month.)

“Unique” (no more than six competitors)

“Ingredients are there.” (Given two years we might find a workable strategy.)

“Basically on plan” (Expect a revenue shortfall of 25 percent.)

“Acquisition strategy” (The current products have no market.)

“Core business” (Obsolete product line)

This post was written by Cheryl Isen, founder of Isen & Company, a strategic marketing and public relations firm that helps emerging companies increase corporate visibility and brand awareness.

December 2, 2008

Location: Schaeffer Auditorium, Seattle University, Seattle
Time: 7 pm - 9 pm
Cost:  FREE
Register Now >>

What you will Learn:
Are you working on something that you think may be a break through idea or perhaps wondering what the really great break through ideas are?  Whether you already have your idea or are looking for something to help you figure out your next big idea is, join us on December 2nd to hear insights from Nick Hanauer who has been described as “truly incredible about spotting so many of the successful ideas in the Northwest for the last 10 years.”

Nick will share his thoughts on what break through ideas are and offer examples of companies he views as having developed true break throughs during the past ten years.  Best of all, Nick will offer his perspectives on how you know a break through idea when you see it and where he thinks the next break through ideas will be.

As always with NWEN Think Tank events, there will be opportunity for dynamic and engaging interactive dialogue.  This event is certain to be a unique and outstanding program so don’t miss it.  Early registration is recommended.

Featured Presenter
Nicolas J Hanauer is a founding partner of Second Avenue Partners, a Seattle-based company that provides management, strategy, and capital for early stage firms such as HouseValues.com, Ice Energy, Insitu Group, Modumetal and Newsvine. Nick is Vice Chairman of Marchex and serves as a Board Member and Advisor to House Values.com.

Hanauer became the first non-family investor in Amazon.com in 1995 where he served as a Board Advisor for the company. In 1996, he founded and served as CEO of internet media company Avenue A Media; later re-named aQuantive, Inc. and became Chairman of the board when the company went public.  aQuantive was purchased by Microsoft in August of 2007 for 6.4 billion dollars; the largest acquisition in Microsoft history.  In 1998, Hanauer founded Gear.com and served as Chairman of the company for three years until it merged with Overstock.com.

Nick began his professional career at Pacific Coast Feather Company as the company’s executive VP of Sales and Marketing, and helped grow Pacific Coast from several million dollars in sales to more than 300 million. He remains the company’s Co-Chairman and Chief Strategy Officer. While still an executive with Pacific Coast, Hanauer co-founded Museum Quality Framing Company. Today that company has 60 stores and is the largest of its kind on the west coast.

Today, Hanauer is actively involved in the Seattle community and Washington State’s public education system, and serves on the boards of the Cascade Land Conservancy, The University of Washington Foundation, The Seattle Alliance for Education, The University of Arizona’s Mt Lemmon Science Center and the Biosphere2; a University of Arizona climate research project.  He published the book “The True Patriot” with co-author Eric Liu in 2007.

Nick Hanauer received a Bachelor of Arts degree in Philosophy from the University of Washington in 1981.

Thank you to our Think Tank Sponsor:

In my opinion, this video provides a very accurate picture of what it’s like to be an entrepreneur.

When you’re an entrepreneur, the #1 goal of every day, week and month is to NOT DIE.  You’re continually dodging bullets, and must continually look out for and focus on every risk — running out of money, losing a key customer, pissing off an investor, losing a critical member of the team, etc. When you have no momentum (and even if you do have momentum), there are hundreds of ways to screw everything up — then it’s “game over” for you and your company.

Jordan Mitchell, the author of this post, is the CEO and Founder of Others Online, his 4th Internet startup. Others Online helps Web site publishers and networks better understand, target and monetize their audience through the use of proprietary affinity profiling software. Jordan blogs regularly and tweets even more!

The Northwest Entrepreneur Network is pleased to announce the launch of NWEN Advisors. A new program whereby NWEN will connect Seattle area entrepreneurs with business advisors from the local community. The NWEN Advisors committee will connect entrepreneurs with advisors based on common industries, skill sets, and experiences.

1. You determine how the relationship progresses.
2. This should not be used for sales prospecting. The primary purpose of both parties should be knowledge transfer and assistance.
3. No fee or hourly rate will be assessed by either party to the other.