Mentors and Law of Diminishing Returns
I mentor at many incubators, accelerators and programs, and what is clear is that while mentors are extremely valuable, they can cause a lot of confusion for entrepreneurs.
Mentors have various backgrounds and experiences. Some have been operators, some have been founders, some are technical, and some are investors. What makes them mentors is some form of experience and their love of helping the innovation ecosystem. But not all mentors can help all startups. Or, as I put it, “Mentors are not created equally”. Founders should be cautious as to who they listen to as their mentors.
For example, on the subject of Pitching, we know that many deep tech founders have difficulty communicating with potential investors or even their customers about their solutions. Deep tech founders usually are in love with the tech and miss the bigger vision of How You Make Money?, and thus, rightfully so, a lot of mentors focus on helping them with the way they present their deck.
But here is when the problem starts to arise. After months of working on decks and pitching at some point, one mentor loves to see more text, while the other wants to see less text. One mentor wants to see the Team slide in the beginning, and the other wants to see it at the end. When contradicting recommendations kick in, and the founder tries to listen and follow every instruction from every mentor, the confusion begins and that is when I tell them to think about the law of diminishing returns.
Diminishing returns, also called the law of diminishing returns or principle of diminishing marginal productivity, is an economic law stating that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield progressively smaller, or diminishing, increases in output.
It is hard to realize that sometimes more efforts could result in negative returns, which is counter-intuitive since our tech giant idols seemingly sleep three hours a night, run seven companies, and are making solid returns. Well, the law still stands and, at some point, could kick in.
Founders have to pick the suggestions that work for them and must not follow every mentor’s advice. No one knows about your business than you, and no mentor is a better judge than you to decide what is best for your business. Pick the suggestion that makes sense to you, do not try to make your mentors happy by doing exactly what they say.
First of all, I suggest talking to three or four mentors. You do not have to stick to a mentor if they do not add value. Don’t be the founder that moves from one incubator to the next but there is no update on the business. Second, do not follow every bit of advice you hear. Third, as a founder, make sure you add your unique take on the business. At the end of the day, no one knows what works. We have all perfected the art of pattern matching, and past results can never guarantee future outcomes.
A common piece of advice from mentors is to focus on one niche market. While that is good advice, it might not be good advice for you or your business. Try not to put yourself in a formulaic box that has worked before. What if your unique way is the way to go, and the template you follow is useless for your case?
Trust your gut and crush it!
