Mentors versus Advisors— What’s the diff?

Back in 1999 two U.S. Marshals walked into my office with several boxes of evidence. They placed them down on my desk and told me I was part of an investigation and lawsuit by the Federal Trade Commission. I sat back and uttered some “French.”

I didn’t call an advisor. I picked up the phone and immediately called my mentor.

Hi Jay. I just got served with papers from two federal Marshals. Got a minute?

Jay dropped what he was doing and started calming me down. He asked me what was in the boxes and had me read him the complaint over the phone.

I had been hired by an Alabama-based company named WebViper to execute a turn-around and sell the company. I had done just that and was now onto a new project after the sale.

The two founding executives Tommy and Patrick were being investigated along with their company for things prior to my arrival. My name was added to the lawsuit because I was listed as WebViper’s Chief Operating Officer for the three months I orchestrated the turn-around and subsequent sale to a Dallas company.

It is important to know that mentors and advisors are not the same thing.

Spoiler Alert: I was dismissed from the FTC investigation and lawsuit after they reviewed the dates of my employment and found that my role was to fix the issues.

My Mentor

Jay Brummett is an American Indian and all-around technology wiz from Utah. I met Jay when we co-authored a book in the mid-1990’s on the “convergence” of voice, video, and data.

Back in 1997 Jay and I were relaxing in a sauna after a long day of working in Dallas when he brought me his proposal.

Now that we are done with the book I would like you to consider me being your mentor.

I hadn’t thought much about having a mentor. He explained how it worked.

Andy Grove mentors Steve DeWindt and Steve mentors me. I would like to mentor you. We share information through a waterfall with the goal of helping the person downstream. The only requirement for you is you must eventually find someone to mentor and offer them the same deal.

There were guidelines set for the mentor-mentee relationship.

1. A mentor is for me, not my company.
2. A mentor cannot be financially-compensated for providing advice to me.
3. A mentor transitions with me throughout my career, not just at my current company.
4. I may only have one mentor at a time.

Advisor

Where mentors are for a person, advisors are for companies. My company SubtleData had a great group of advisors who were financially compensated via equity grants to provide information and advice to the executive team. We set aside 2.5% of our equity to be split between our five advisors.

Advisors differ from mentors as their dedication is to the company. If an executive team member leaves and a new one replaces them, the advisor’s relationship with the company remains in place. It does not transition with the departing executive.

Secondly, a mentor can never be an advisor to the mentee’s company. It puts them in a conflict of interest that will violate the mentor and advisor relationships.

An easy way to see the conflict is where a mentee gets frustrated with other members of the executive team and tells their mentor things putting them at odds with the rest of the executive team. If the mentor were also the company’s advisor, they would be unable to maintain the arms-length transaction to provide objective information.

Conversely a mentor who advises the mentee’s company may be told things about the mentee which put them in a pickle as to choosing to support the company or the mentee.

Incubators and Accelerators

Several accelerators and incubators claim to have a large number of mentors for companies in their program. The term has been thrown around so much it has fractured the very meaning of the word mentor.

These programs have advisors that are sometimes paid by the companies enrolled in the program and sometimes they offer their advisory services at no charge.

Think back to the day the U.S. Marshals came to my office. If Jay had been on the advisory board of my new company, what would he say if I told him I was being sued by the Federal Government? He likely would have called someone else at the company and said “Houston, we have a problem!”

Picking Advisors

I have used several guiding principles for selecting advisors for my companies.

1. An advisor should create value for the company through relationships.
2. An advisor should have an area of expertise that enhances the executive team.
3. An advisor should not have any conflicts of interest with the company.
4. An advisor should get along with the executive team.

Picking a Mentor

It is rare that a mentee picks their mentor as mentors pick their mentee. Here are things to look out for when someone approaches you about being your mentor.

1. You should be happy to have them at your home for dinner.
2. Your significant other should like them since there will be a long-term personal relationship with them.
3. They should not financially benefit from providing you with their sage advice.

Mentors and advisors help in their own ways

When used effectively mentors and advisors serve two distinct purposes for you and your company. My companies have seen tremendous value creation from our advisors and I have seen tremendous personal growth from my relationship with my mentor.

I wish you luck in selecting your advisors and wish you luck in getting a great mentor.

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