Enhancing Entrepreneurial Learning by UArts Design for Social Impact MDes / Master of Industrial Design

Enhancing Entrepreneurial Learning Designing a System that better Enables Knowledge and Experience Transfer from Business Mentor to Entrepreneur By Benjamin Farahmand

Benjamin Farahmand

Enhancing Entrepreneurial Learning: Designing a System that better Enables Knowledge and Experience Transfer from Business Mentor to Entrepreneur

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320 South Broad Street Philadelphia, PA 19107 Copyright ÂŠ 2013

Copyright © 2013 by Benjamin Farahmand Illustrations copyright © 2013 by Benjamin Farahmand Photography credits: All photography created by © 2013 Benjamin Farahmand unless otherwise noted. All rights reserved. No portion of this book may be reproduced–mechanically, electronically, or by any other means, including photocopying–without written permission of the publisher. Cover design by Benjamin Farahmand Book design by Benjamin Farahmand Master of Industrial Design at The University of the Arts 320 South Broad Street Philadelphia, PA, 19102 First printing June 2013

Enhancing Entrepreneurial Learning: Designing a System that better Enables Knowledge and Experience Transfer from Business Mentor to Entrepreneur By Benjamin Farahmand

A Thesis Submitted in Partial Fulfillment of the Requirements for the Degree Master of Industrial Design in the School of Design

The University of the Arts, Philadelphia, Pennsylvania May, 2013

Thesis Committee: Committee Chair: Angel Rodriguez, Executive Director, Empowerment Group Advisor: Sharon Lefevre, Professor, University of the Arts Advisor: Jeremy Beaudry, MiD Program Director, University of the Arts

Acknowledgements I would like to thank the individuals on my old and new thesis committee: Jeff Wolper, Jonas Milder, Neil Kleinman, Sharon Lefevre, Angel Rodriguez, and Jeremy Beaudry. The development of this thesis has been the result of countless conversations, formal and informal interviews, coffee meetings - too many people to name. Each of these Philadelphians have been integral to discovering and framing a focus for this thesis. There are a few individuals and organizations particularly helpful in the development of my thesis: The Corzo Center for The Creative Economy, The Empowerment Group, GoodCompany Group, Venturef0rth, Aaron Mclean, Elliot Menschik, and Garrett Melby. Finally, I would like to thank Marcie Brozyna for listening to my year long chatter, ideation, and analysis of the Philadelphia startup community, their mentors, and their entrepreneurs.

To the Philadelphia Startup Community

Abstract The focus of this thesis is to enhance entrepreneurial learning by designing a system that filters, sorts, matches, and tracks entrepreneurs with the right mentors. These mentors are matched based upon the domain of the startup, their role (marketing, tech, finance, businesss development, etc), the types of problems they find interesting, industry experience, and the amount of time available. In order to design such a system, it is necessary to generate a model that describes the interaction between mentor and entreprenuer. The structure of interaction uncovered by this thesis has three phases: pre-meeting, meeting, and follow-up. By incorporating pieces of the digital world into the pre-meeting and the follow-up, the designed system ensures two key aspects. The first, the entrepreneur receives focused, relevant, and strategic advice regarding their business. The second, the mentor knows the outcome of the meeting ahead of time, the history of the entrepreneur, and where the entrepreneur needs strategic advice. These two key points enhances the meeting phase, where knowledge and experience is transfered from mentor to entrepreneur.

Navigational Elements As you move through this book, expect to see navigational elements calling your attention to relevant information. The gold ovals contain the word definition and application. Every time a definition is presented they will be accompanied with the definition oval. These definitions will build a foundation for the language to understand this thesis. Also, expect to see gold ovals with the word application. These are intended to point out applications of theory or research thatâ&#x20AC;&#x2122;s pertinant to moving this thesis forward. Occasionally you will see highlights intended to draw your attention to main points if youâ&#x20AC;&#x2122;re not interested in reading the analysis. You will also notice a two inch margin intentionally provided to allow for notetaking.

Definition

Application

Concepts

Expect to see four icons hanging off of each section or subsection title, providing insight into where that section fits within the design process. The final navigational element to keep in mind are key concepts, which will be pointed out with a rounded rectangle in dark blue. While flipping through the book, chapter headers are distinguished with a gold line and heavy weight font, section headers have a burnt orange-brown line with medium weight font, and subsection headers are denoted with a blue line and light weight font.

Chapter Headers Section Headers SubSection Headers

Table of Contents Introduction // Purpose and Rationale // The Perspective of Human Centered Design // Background // Stakeholder Map

24 Chapter One: Literature Research // What is Entrepreneurship? // What is a Startup? // Different Types of Information Technology Startups // The Information Technology Startup’s Lifecycle and When Mentors First Get Involved // What is Entrepreneurial Learning? // What is a Mentor? // How do Mentors Enable Entrepreneurial Learning? // Return on Involvement: The Mentor’s Motivation 44 Chapter Two: Field Research // Problem Discovery // Ethnographic Research // First Round of Interviews // Analysis of First Round of Interviews // Identifying Resource Allocation through Mapping Philadelphia’s Startup Ecosystem // Second Round of Interviews: Tangible Interviews // Analysis of Second Round of Interviews // Why Focus on Mentoring? // Relationship: Experienced and Novice Entrepreneurs // Framing the Problem // Finding and Accessing the Right Mentors // Classifying Mentor-Entrepreneur Interactions // Data on Planned Interactions // Analysis of Interactions // What Happens After the Mentoring Session?

Chapter Three: Design Solutions // Prototyping // The Mentor System // Pre-Meeting: Entrepreneur Intake // Pre-Meeting: Request for Mentoring // Pre-Meeting: Mentor Intake // Pre-Meeting: Digital Matchmaking // Meeting // Follow-up // Recommendations for Building and Testing // Action Plan

104

Chapter Four: Conclusion // Limitations and Further Development

128

Appendix A: Iterations of the Mentor System Appendix B: Iterations of the Request for Mentoring Form Appendix C: Other Areas of Research Appendix D: Glossary Appendix E: Bibliography Postscript About the Author

132 142 150 164 166 170 172

Introduction The introduction explains the scope of the thesis and the design process. Expect a brief discussion about the current economic and social backdrop on the national and city scale. This discussion is intended to show the relevancy of this thesis by tieing it to the recent rise in entrepreneurship and the potential of reducing unemployment and underemployment via mentor based learning for entrepreneurs.

Purpose and Rationale

Key Areas

The purpose of this thesis is to find an appropriate model to explain the interactions between a mentor and an entrepreneur, in order to design a system that can better enable entrepreneurial learning. On the opposite page, you will see the three part model describing the interactions between mentors and entrepreneurs. Each part of the model has sub-categories that represent key areas that hinder or enable entrepreneurial learning. A system should be designed that focuses on these three areas. Most of these key areas can be both a hinderance and an enabler depending on the perspective and circumstance. For example, trust is an enabler when it exists between mentor and entrepreneur and can be a hinderance when it does not exist.

Introduction

Pre-Meeting

Meeting

Follow-Up

{ { {

Busy Schedules

Trust

Serendipity

Identification

Long-Term

Planned

Short-Term

Serendipitous

Actionable Steps

Learning

Valuable Insight

Outcome

} } } 15

The Perspective of Human Centered Design Human Centered Design (HCD) has two foundational premises. The first, individuals comprising a culture are the experts of their culture. The second, in order to design a solution for a cultureâ&#x20AC;&#x2122;s problem, the designer is not the expert of the solution or the problem. A culture comprises all the rules and beliefs, tacit and explicit, governing interactions between individuals, thought and action processes, and value systems. An individual can be a part of several different cultures, and cultures may also influence one another just as individuals influence one another. The implications of these two premises set the necessary conditions for a design process that removes the designer as the locus of action for solving and framing a problem. This means the designer acts as a communicator and investigator, discovering a cultureâ&#x20AC;&#x2122;s problems through ethnographic research, interviews, surveys, and cultural probes. The information gathered is synthesized, analyzed, and summarized to be communicated back to the individuals of a culture, so these individuals may validate or invalidate how the culture is framing its own problem. This means the human centered designer is also a facilitator, allowing the culture to use the designer as a means to solve their own problem. The value in applying the HCD process to entrepreneurial mentorship is that it sets the designer on a path to enable the entrepreneurial community to solve its own problem while using the designer as a conduit. Throughout this thesis, you will see examples of validating a problem, synthesizing data into knowledge, and allowing the entrepreneurial community to use the HCD process to facilitate a solution to their problem.

Introduction

One opportunity for HCD to add value exists in designing a mentoring system that is in sync with the values, beliefs, and rules of the entrepreneurial culture. The HCD solution is like the difference between transplanting an organ with the risk of rejection and growing an organ from the host body. This opportunity for facilitating the design of a mentoring system was discovered at the intersection of mentoring relationships, mentoring sessions, networking events, startup successes and failures, incubators and accelerators.

Discover Test

Frame Prototype

Synthesizing Data into Knowledge 19

Background The Reason Entrepreneurial Learning Matters I am going to argue that improving entrepreneurial learning will reduce unemployment and underemployment, which will hopefully show the urgency of designing systems that promote mentorship. To put this thesis into the context of the current economic climate, my generation (people graduating post-crash) is having difficulty finding their way into established companies. According to the Bureau of Labor Statistics, the fourth quarter of 2011 had unemployment rates amongst those aged 16 to 19 at 23.6%, those aged 20 to 24 at 14.2%, and those aged 25 to 34 at 9.4%. According to Gallop Poll tracking January 2nd to September 30th, 2011, for those aged 18 to 29, 30% are underemployed and 14% are unemployed. This means that it has become much more difficult to find employment in existing organizations. Also, in recent years, there has been a growing and revived interest in entrepreneurship, and I believe the connection between the crash and the current rise of entrepreneurship in American society is more than correlated. As one of my interviewee’s put it, it’s one of the current causes of “startup companies popping up like Rock bands in the 80’s.” In an interview, a community leader of the Philadelphia startup community said, “Every startup that comes in creates ancillary jobs that generate taxes that gives back to the city, that gives back to build better things.” This is not simply anecdotal, but is supported by a job growth study performed by the Kauffman Foundation. The report concludes that “new firms add an average of 3 million jobs in their first year, while older companies lose 1 million jobs annually.” This means that people

Introduction

realize the potential behind getting involved in a new firm or starting one. The Kauffman report studied startups and existing firms from 1977 to 2005, and defines startups as firms younger than one year old. The report goes on to say that policymakers do not correctly focus their attention on supporting startup growth. This opinion is reflected in the same startup community leader, “The older institutions that were fostered in the 60s, like Ben Franklin tech partners, like the science center, like the chamber of commerce these bureaucrats and older generation, are trying to sustain their positions and their jobs and companies and they’re not fostering innovation.” This community leader has been an advocate for startups in Philadelphia for the past decade. Putting his opinion side-by-side with the findings from the Kauffman report means that people have already realized the potential behind getting involved in a new firm or starting one. However, the reality is ninety percent of startups fail. Seventy percent of them, according to the Startup Genome, scale prematurely along any one of five dimensions, which they think may partly explain the ninety percent failure rate amongst technology startups. The Startup Genome has published two reports, one with a data set of 650+ internet technology startups and another on 3200+ internet technology startups. The Startup Genome set out to test three hypotheses, and one which is of interest to this thesis is, “Learning is a fundamental unit of progress for startups. More learning should increase chances of success.” They went on to discover, “Founders that learn are more successful. Start-ups that have helpful mentors, track performance metrics effectively, and learn from start-up thought leaders raise 7x more money and have 3.5x better user growth.” They point to

three factors being relevant for funding and user growth: helpful mentors, tracking metrics, and learning from thought leaders. All three provide the foundation to learn. Being able to raise funds and maintain user growth is key to a healthy startup, which means that learning is vital for a healthy startup. (Startup Genome) To put learning into perspective, it seems enabling learning in startups should decrease the unemployment and underemployment rate present in those aged 18 to 29. While testing this hypothesis is out of the scope of this thesis, drawing this connection between the unemployment rate and learning in startups underlies my own motivations for focusing on this area. To push this connection one more step, in this thesis I will be proposing a design that looks specifically at mentor relationships as a way to enable learning for novice entrepreneurs. The implication, mentorship is another strategy to reduce unemployment and underemployment.

Introduction

Background The Philadelphia Backdrop The context and backdrop of this thesis is the Philadelphia information technology startup community. This community is young and fledgeling when compared to the already established communities of Silicon Valley, London, and New York. The community is also dwarfed in comparison to the already established industries of Philadelphia: pharmaceuticals and health services, bio-tech, real estate, the life sciences, and higher education (Startup Compass). The challenges facing the community are many, ranging from a lack of graphic designers, user interface designers, user experience designers, and investment funds, to a need for mentors and work spaces that allow for collaboration (City Data). These are some of the challenges and lack of resources that the community will have to overcome. In order for this community to grow there needs to be mechanisms in place that retain the information technology startups from leaving Philadelphia. By focusing on the transfer of knowledge and experience from mentors (experienced entrepreneurs) to novice entrepreneurs, this thesis presents a design for a mentor system that will be a step towards the growth of Philadelphiaâ&#x20AC;&#x2122;s startup community.

Stakeholder Map There are two versions of the stakeholder map. The top stakeholder map was discovered mid-way through the thesis and was a guiding framework to understand mentors and entrepreneurs. The bottom was discovered only at the end of this thesis when the mentor system was developed in conjunection with several mentors throughout the startup community. This bottom map has three groups of stakeholders: entrepreneurs, mentors, and mentoring organizations. Over the course of this thesis I learned these stakeholders are not limited to Philadelphia; the designed solution this thesis proposes is scalable and can impact entrepreneurs, mentors, and mentoring organizations across a number of startup communities. In the bottom stakeholder map, the relationship between mentors and entrepreneurs is the same as the first map. However, the relationship and interactions between the mentors and the mentoring organization are not yet known and neither is the interaction between the entrepreneur and the mentoring organization.

Introduction

Experienced Entrepreneurs

Value

Novice Entrepreneurs

Interface Motivation to Mentor

Characteristics of a Mentor

Value

Mentors

Motivation to be Mentored

Characteristics of a Mentorable Entrepreneur

Entrepreneurs

Mentoring Organizations

Chapter One: Literature Research Since there is disagreement amongst entrepreneurship scholars, politicians, and entrepreneurs regarding the nature of entrepreneurship and startups, the literature research of this thesis presents definitions and examples from various sources, compares and contrasts these definitions with criticism, and then presents a working definition that provides scope to this thesis.

Judges Voting on the Best Startup during Philly Startup Weekend 2.0

What is Entrepreneurship? Books and journal articles regarding entrepreneurship do not seem to agree on a single interpretation of what it means to be an entrepreneur. And if entrepreneurship can not be pinned down, then entrepreneurial learning and the mentorship required cannot be correctly addressed. To ground this thesis in a single working definition, I will present a few different perspectives and then put forth my own from what I have observed and learned over the past year. Definition

Definition

Eric Ries, in The Lean Startup argues that entrepreneurship is management that can grow the business. He goes on and discusses the importance of being able to effectively measure and learn by testing assumptions. By testing assumptions, the entrepreneur can effectively plan for the future on facts that have been proven true. Thus, the entrepreneur may effectively allocate resources. Again, this comes down to learning, being able to know what and how to learn, and how to measure one’s progress, which leads to learning – an hypothesis proven true by the Startup Genome. In an interview with Big Think, Saras Sarasvathy, a leading researcher on entrepreneurship, describes entrepreneurship as a way of thinking, as a way of solving problems – just as the scientific method is one possible way of solving problems. From her research, she has concluded that entrepreneurship is not about certain character traits, meaning that anyone can be an entrepreneur. With this stance, she teaches a way of thinking, a certain type of logic that experienced and successful entrepreneurs seem to employ. William Gartner, back in 1988, argued that “entrepreneurship is the creation of organizations.” Thus, one can distinguish an entrepreneur by the organizations they create, a view that is similar

Chapter One: Literature Research

to the one re-iterated two decades later by Eric Ries. Furthermore, Gartner had also argued that defining entrepreneurship by the traits embodied by a certain individual has been “unfruitful.” In a literature review about entrepreneurial learning, Peter Erdelyi points out that “developing a single, widely acceptable definition of entrepreneurship however is not only a conceptual issue but also a matter of political disagreement, as it would affect the allocation of resources (such as academic attention and government funds).” He goes on to say that “in academic practice, new venture creation and small business management are often conflated under the term ‘entrepreneurship,’ while ‘innovation’ is often used as analogous with ‘entrepreneurship’.” There are three main points presented by these different thinkers I would like to bring to your attention: solving problems, creating an organization, and managing that organization. The problems being solved are problems faced by a customer or user. The creation and management of an organization is the process of bringing together a team to help solve that problem, raising venture capital, making a business plan, and the various other parts that need to move in harmony. From my interviews, observations, and experiences within the Philadelphia tech startup ecosystem, it seems that these three points are the most relevant in defining the role of an entrepreneur. Entrepreneurship is a role because entrepreneurship is dependent on a set of behaviors and not a set of embodied traits. This means an entrepreneur is the role a person fills to create and manage a business to solve a problem a customer is experiencing. In the process, value is created in the exchange between the customer and the startup because the startup relieves some pain for the customer and the customer is willing to pay for the startup's remedy. Using this as my definition for an entrepreneur, I believe there are certain implications for entrepreneurial learning. Since an entrepreneur is the role a person fills to create and

Definition

manage a business to generate value for a customer, then entrepreneurial learning is the learning process associated with knowing what to do while filling that role.

What is a Startup?

Definition

The Kauffman Foundation in the study, “The Importance of Startups in Job Creation and Job Destruction,” defined a startup as any firm that is younger than one year. However, this umbrella term covers all types of startups irregardless of industry, and is too broad to use for this thesis. The working definition for this thesis is similar to, but not the same, the Startup Genome. They define a startup as “a developmental organism that evolves along five interdependent dimensions: Customer, Product, Team, Business Model and Financials". This means that a startup is either an individual or a small group of people working on solving a problem by starting a business. The differences in my definition is that I add five more dimensions I have surveyed and observed entrepreneurs managing in order to grow their startup. To the Startup Genome’s five dimensions of customer development, product development, team, business development and financials, I also added fundraising, legal, marketing, operations, and sales. Eric Ries in The Lean Startup defines a startup as “a human institution designed to create a new product or service under conditions of extreme uncertainty.” His definition is along similar lines as the Startup Genome's except that he includes the startup's environment, "conditions of extreme uncertainty." The

Chapter One: Literature Research

"uncertainty" is an important aspect to the definition because it captures the fact that a startup lives or dies by how well it acquires and retains customers. This is also in line with Steve Blankâ&#x20AC;&#x2122;s life cycle definition of a startup, which determines the stage of a startup by how well it knows its customers and how many customers it has. Therefore, the definition of a startup for this thesis combines both the Startup Genome's and Ries' definition with the aforementioned survey and observations. A startup is a human institution that evolves under conditions of extreme uncertainty along ten interdependent dimensions (business development, customer development, finance, fundraising, legal, marketing, operations, product development, sales, and team) to create a new product or service for a specific customer/user group. This is a useful definition for mentoring because it reveals the strategic areas where mentors should provide business advice.

Definition

Application

Different Types of Information Technology Startups

Definition

Steve Blank in The Four Steps to the Epiphany observes that there are four types of startups: those “entering an existing market,” those “creating an entirely new market,” those that “want to resegment an existing market as a low cost entrant,” and those that “want to resegment an existing market as a niche player.” Essentially, he is defining the differences between startups based upon how they reach and offer a service or product to their customers and users. One can identify a startup entering an existing market with a new product by looking at the product they are offering, comparing it to competition and noticing higher performances in the new product when compared to competitors (Blank). A new product in a new market is, “when a company creates a large customer base who couldn’t do something before” (Blank). This is a result of creating something that has never before existed. When a startup resegments an existing market as a low cost entrant, it means that a startup is targeting a smaller group of people within an existing market. Doing so, allows for the startup to successfully allocate resources to focus on a single user group before going on and tackling the rest of the market. Within the IT industry, the Startup Genome has discovered startups grouped into three major clusters: the automator, the integrator, and the challenger, with a fourth type, the social transformer, similar to the automator except that its product also has network effects. Each type is based on the way the startup acquires and interacts with its users and customers. The three main types are defined by a spectrum with 100% marketing on one end, 100% sales on the other, and a midpoint. Furthermore, the Startup Genome also provides a definition for a startup with multiple audiences. For example, the startup could be an

Chapter One: Literature Research

automator for one of its user groups, while an integrator to another. The Startup Genome uses the word “wing” to describe a startup with multiple user groups. The startup may have a core type and have one of the other types as a wing. All the types interact with their customers via their software, which is their product or service, and usually by means of the internet. 100% Marketing

50% Marketing 50% Sales

100% Sales

Automator

Integrator

Challenger

Social Transformer The automator is a type of startup that is focused on the product, a self service customer acquisition, and has low overhead. They are on the end of the spectrum of 100% marketing. They're “more likely to tackle existing markets” and have a lowest barrier to entry in comparison to the other three types. This also means that they have the most competition because a competitor may simply build a product, put it on the internet, provide a fantastic user experience, and begin taking market share from an existing automator (Startup Genome). Examples that are provided by the Startup Genome of companies that fit into the automater category include: “Google, Dropbox, EventBrite, Slideshare, Mint, Groupon, Pandora, KickStarter, Zynga, Playdom, Modcloth, Chegg, Powerset, Box.net, Basecamp, Hipmunk, OpenTable, and Amazon” (Startup Genome).

Definition

The social transformer is similar to the automator in that it has a self service customer acquisition strategy, except that its product also has network effects. Since the social transformer type has network effects, the biggest challenge for their product is to reach a critical mass of users. “Their products are characterized by creating new ways for people to interact” (Startup Genome). Examples of social transformers include: “Ebay, OkCupid, Skype, Airbnb, Craigslist, Etsy, IMVU, Flickr, Linkedin, Yelp, Aardvark, Facebook, Twitter, Foursquare, Youtube, Dailybooth, Mechanical Turk, MyYearbook, Prosper, Paypal, and Quora” (Startup Genome). The integrator is in the mid-point of the spectrum, with 50% marketing and 50% sales. In other words, they “have a semiautomated customer acquisition strategy” (Startup Genome). This means they are partially hands-on with how they acquire new customers and partially hands-off when compared to the other types. Examples of integrators include: “HubSpot, Marketo Xignite, PBWorks, Zendesk, Uservoice, GetSatisfaction, Flowtown, Kiss Metrics, Mixpanel, DimDim, Kontangent, and Zoho” (Startup Genome). The challenger is at the end point of 100% sales and is focused around selling to enterprises. Examples of challengers include: “Salesforce, Zimbra, MySQL, Redhat, Jive, Ariba, Rapleaf, Involver, Oracle, Yammer, BazaarVoice, Atlassian, BuddyMedia, Palantir, Netsuite, Passkey, WorkDay, Apptio, Zuora, Cloudera, Splunk, SuccessFactor, Yammer, Postini, and BrightEdge” (Startup Genome).

Chapter One: Literature Research

The Information Technology Startup’s Lifecycle & When Mentors First Get Involved In The Four Steps to the Epiphany, Steve Blank identifies four major stages for a startup, and they all revolve around how well the startup knows the customer. The four stages he discusses are customer discovery, customer validation, customer creation, and company building. Each of these stages are nonlinear; they are iterative, and are used to make sure the startup does not overextend itself. Blank is teaching that it is most important to know the customer, their needs and wants. It is vital product or service development should not outpace the learning that is associated with knowing the customer. “The goal of customer discovery is just what the name implies: finding out who the customers for your product are and whether the problem you believe you are solving is important to them” (Blank). Customer validation is the stage where the startup builds, “a repeatable sales road map for the sales and marketing teams … customer validation proves that you have found a set of customers and a market who react positively to the product: By relieving those customers of some of their money” (Blank). Customer creation is the step where the company is building on previous successes of acquiring its first few customers. The goal of customer creation, “is to create end-user demand and drive that demand into the company's sales channel” (Blank). “Company building is where the company transitions from its informal, learning and discovery-oriented Customer Development team into formal departments with Vps of Sales, Marketing and

Definition

Business Developmentâ&#x20AC;? (Blank).

Definition Definition

Definition

The Startup Genome defines the startup's life cycle in a similar fashion to Steve Blank. There are two major subdivisions: early and late stage. Early stage is the period of startup life where the team is figuring out how their product or service may best solve the problem of their target audience. Late stage is the period of startup life where the team is focused on making their early stage successes repeatable and scalable. From early to late stage, the startup life cycle is more nuanced, and the Startup Genome mentions six stages. Their report provides data and analysis on four of the stages: discovery, validation, efficiency, and scale. These stages are similar to Blanks definitions, and relate to the four types of information technology (IT) startups they discovered: the automator, the social transformer, the integrator, and the challenger. During the discovery stage, the purpose of the startup is to figure out whether or not they are solving a problem that anyone is interested in. There are some key events that are typical for this stage, but not all have to occur: â&#x20AC;&#x153;founding team is formed, many customer interviews are conducted, value proposition is found, minimally viable products are created, team joins an accelerator or incubator, Friends and Family financing round, first mentors & advisors come on boardâ&#x20AC;? (Startup Genome). For all four types of IT startups, the average amount of time to push through the discovery stage is between five to seven months. During the validation stage, the startup is getting feedback on their product or service by means of money or attention. Essentially, they have proof that people are interested in their product or service. Some of the key events that are typical for this stage:

Chapter One: Literature Research

“refinement of core features, initial user growth, metrics and analytics implementation, seed funding, first key hires, pivots (if necessary), first paying customers, product market fit” (Startup Genome). For all four types of IT startups, the average amount of time to push through the validation stage is between three to five months. During the efficiency stage, the startup is focused on making sure the business model works like a well oiled machine and they are efficiently acquiring customers based upon the research and customer knowledge they have built up during the previous two stages. Some of the key events typical for this stage include: “value proposition refined, user experience overhauled, conversion funnel optimized, viral growth achieved, repeatable sales process and/or scalable customer acquisition channels found” (Startup Genome). For all four types of IT startups, the average amount of time to push through the efficiency stage is between 5 and 6 months. During the scale stage, the startup is focused on aggressively growing the company and is typically defined by: “large A Round, massive customer acquisition, back-end scalability improvements, first executive hires, process implementation, establishment of departments” (Startup Genome). For all four types of IT startups, the average amount of time to push through the scale stage is seven to nine months. This discussion on the lifecycle of the startup applies to this thesis in the context of when mentors become involved in the startup’s life. The Startup Genome report has shown mentors and advisers first come on board at the discovery stage, which is the first few months of a startup’s life. Therefore, in the context of this thesis,

Definition

Application

it is most valuable to the startup if a mentor is involved in the discovery stage because, “the right mentors influence a company’s performance and ability to raise money” (Startup Genome).

What is Entrepreneurial Learning? In the section titled “What is Entrepreneurship?,” I concluded that an entrepreneur is the role a person fills to create and manage a business to generate value for a customer. This implies that entrepreneurial learning is the learning that occurs while filling the entrepreneur's role. Since this thesis is studying and designing around the learning mentors provide for entrepreneurs, a definition needs to be developed that frames how this learning should be supported, whether through examples, strategic planning, asking questions, or something entirely different. I will begin with an overview of various definitions of entrepreneurial learning. I will then take what can be used from them, and finally, I will end with a discussion on why mentors should pay attention to how entrepreneurs naturally learn.

Definition Definition Definition

In “Entrepreneurial Learning: a narrative-based conceptual model,” David Rae identifies three major areas that play a role in the entrepreneur's learning: personal and social emergence, contextual learning, and negotiated enterprise. Personal and social emergence is the creation of the individual's self-perception as an entrepreneur. Essentially, the person must believe he or she can turn an idea into reality. Contextual learning is the use of one's knowledge and experience within an industry or community

Chapter One: Literature Research

to recognize opportunities that ventures can be formed around. Negotiated enterprise is the process of engaging with other people to exchange labor, ideas, learned strategies, or capital (Rae). Peter Erdelyi argues that entrepreneurial learning has two branches: one that involves personal learning and another that involves collective learning. Personal learning focuses on the individual and her experiences, and is the process of “opportunity recognition” and constitutes the “cognitive mechanisms for identifying entrepreneurial business opportunities and making decisions about them” (Erdelyi). Collective learning arises from the interaction of individuals within a firm or within an ecosystem. Both modes of learning give rise to behaviors that encourages the entrepreneur to acquire and use resources available within her network (Erdelyi). Berglund, Hellstrom, and Sjolander propose a model of entrepreneurial learning as a forward oscillation between two modes: hypothesis testing and hermeneutic learning. Hypothesis testing is coming up with an hypothesis and then preparing an experiment to test the validity and soundness of the hypothesis, thus leading to learning. In contrast, hermeneutic learning occurs experientially and is tacit to the actions the entrepreneur makes. The entrepreneurs and the collection of individuals that comprise a startup then fluctuate between these two states as they accumulate incremental knowledge about the product they are building, the customers they are building it for, the market they are operating in (Berglund). Even though Berglund et al proposes this model of entrepreneurial learning as a way to explain how venture capitalists influence entrepreneurial behavior, I think this model can be used within the context of a mentoring relationship to make obvious the entrepreneur's learning behaviors.

Definition

Application

These researchers all hit upon a dichotomy between the individual and the networks they are a part of. The relationships the entrepreneur has with those internal to the startup and those external to the startup seems to determine the behaviors she learns, the opportunities she can recognize, and the opportunities she can act upon. What I mean is that entrepreneurial activity is inherently social in nature â&#x20AC;&#x201C; it is both limited and enabled by the network the entrepreneur is a part of. It is limited by the size of the network and those she can learn from, and enabled by the people she is in contact with because she can learn new business strategies from her fellow entrepreneurs. This means for the context of this thesis, mentors with business experience existing in the entrepreneur's network enable the learning of new strategies, behaviors, and can increase the size of the entrepreneur's network via introductions to new contacts. Entrepreneurial learning, from a mentoring perspective, is a feedback process to develop new strategies the entrepreneur can execute upon to continue managing her business.

Chapter One: Literature Research

What is a Mentor? There are many types of mentors, from those that form relationships with young boys and girls to executives of large companies that guide promising new managers. The types of mentors this thesis is concerned about are experienced entrepreneurs "who actively contribute time, energy, and wisdom to startups" (Feld). These mentors usually play an important role within their respective startup community (Feld). Mentors are different from advisors in their relationship with the startup. Even though an advisor and a mentor may have similar experiences, an advisor "has an economic relationship with the company he is advising" (Feld). This difference between advisor and mentor stems from their motivation to contribute their experiences to the startup. The mentor's reward from putting in time and energy is not a clear return on investment, but is a return on involvement. A return on involvement, the new ROI, is another way of saying that you are willing to "give before you get." Both Startup Communites by Brad Feld and The Rainforest by Hwang and Horowitt address the same cultural norm about entrepreneurs but use different verbage. This norm, which extends to entrepreneurial mentors, is the willingness to give some of your time, energy, or wisdom to a startup or the community without having a clear return on your investment.

Definition

An infographic quantifying the relationship between a mentor and entrepreneur can be seen on page 68.

How do Mentors Enable Entrepreneurial Learning? To understand how a mentor guides and enables the entrepreneur's learning, we need to discuss the three functions a business mentor normally plays in relation to an entrepreneur. These functions enable entrepreneurial self-efficacy; however, a smaller category of these functions, I'll argue, also enable entrepreneurial learning. Essentially, I will attempt to show entrepreneurial learning is enabled through mentorship by the information support, confrontation, guide, and role-model functions. Etienne St-jean, an expert in the field of business mentorship, presents three major functions the mentor plays: the psychological, the career-related, and the role model function. These three major functions have several sub-functions and were determined from a study documenting and analyzing mentor mentee relationships that lasted an average of 16.06 months (standard deviation: 14.4, median: 13) with the mean and average frequency of meetings at once a month and just under a month, respectively, and an average meeting time of 68.52 minutes (standard deviation: 14.4, mean: 67) (St-jean). Definition

The psychological sub-functions include reflector, reassurance, motivation, and confidant. The mentor as a reflector, provides feedback on the entrepreneur's strengths and weaknesses, providing a space to identify these strengths that can be leveraged and weaknesses that should be worked on. The mentor as reassurance, aids the entrepreneur in difficult times when problems need to be put into perspective. The mentor as a motivator builds the entrepreneur's self-confidence in his abilities. The mentor as a confidant creates a safe space where entrepreneur may confide in

Chapter One: Literature Research

the mentor (St-jean). The career-related sub-functions include integration, information support, confrontation, and guide. The mentor as integrator facilitates introductions with various business contacts; and on average, the study learned that mentors introduced the entrepreneurs to 3.44 persons, with a standard deviation of 3.47. The mentor as information support provides strategic business advice based on personal experience and knowledge. The mentor as confrontation, the mentor confronts the entrepreneur's beliefs and ideas such that the entrepreneur may learn to overcome any beliefs or ideas that may prevent the entrepreneur from accomplishing his goals. The mentor as a guide provides a big picture perspective to help the entrepreneur understand the context they are building a business in (St-jean).

Definition

The last category, the role model function, does not have any subfunctions. The mentor as a role model focuses on the mentor's life stories to be used as examples for the entrepreneur to learn from (St-jean).

Definition

The mentor in a long-term relationship with an entrepreneur should also be focusing on increasing entrepreneurial self-efficacy. Selfefficacy is believing one has the skills to attain a desired outcome. Thus, entrepreneurial self-efficacy is the entrepreneur's belief that she has sufficient skill to solve the problem at hand, to grow her business, and attain a desired outcome for her busines. In a study done by Etienne St-jean, he discovered there is a positive correlation - when a mentor encourages entrepreneurial selfefficacy the entrepreneur has increased job satisfaction and has a higher intention to stay as a career entrepreneur (St-jean).

Definition Definition

Since I have only observed short-term mentoring relationships, or at least the beginnings of possibly longer relationships, not all of these functions have been observed during the process of this thesis. The sub-functions observed include integrator, information support, confrontation, guide, and role model. During the interactions between mentor and entrepreneur, the career related and role modeling functions have been observed. The psychological functions have not clearly been observed. The sub-functions information support, confrontation, and guide are most directly related to entrepreneurial learning. Even though this vocabulary is not used throughout the thesis, these subfunctions informed what to observe when making sense of how mentoring interactions enable entrepreneurial learning. Application

Entrepreneurial learning is enabled through mentorship by the information support, confrontation, guide, and role-model functions.

Chapter One: Literature Research

Return on Involvement: The Mentorâ&#x20AC;&#x2122;s Motivation Huang and Horowitt, the authors of The Rainforest, have observed, "people in rainforests are motivated for reasons that defy traditional economic notions of 'rational' behavior." In a booming startup ecosystem, what Huang and Horowitt call a rainforest, different actors have been observed to behave with motivations that defy rational economic theories of human behavior. Instead of individuals simply acting and making choices based upon a return on investment, they make decisions based upon a return on involvement, also known as the new ROI. The new ROI describes the behavior of various actors I have also observed in Philadelphia's startup ecosystem. Huang and Horowitt show that the denizens of a startup ecosystem help startups because they, "seek a return on involvement from participating in and contributing to the success of innovative ventures." As it applies to my thesis, this means mentors are motivated to provide advice to an entrepreneur for a later return on involvement in the venture.

Application

Chapter Two: Field Research This chapter is split into two major parts. The first part is called problem discovery, the second is called framing the problem. Each part contains sub-sections that will go into further detail explaining the steps taken to discover and frame the problem.

Problem Discovery Ethnographic Research Though it can appear to be inefficient, the purpose of ethnographic research is to engage a culture on its terms. By initially engaging the startup culture without using surveys or interviews, the culture of study is not forced to conform to the researcherâ&#x20AC;&#x2122;s standards of interaction, which can lead to gathering biased data. Ethnographic research is a means to attain first hand experience of language and behavior, which can later inform questions to be used on surveys and interviews. For the purpose of this thesis, it was necessary to attend entrepreneurial events to observe how individuals within startup communities communicate, interact, and behave. The events I attended include Philly Tech Meetup, Founders Factory, Philly Startup Weekend, events put on by Philly Startup Leaders, and various networking events put on by local organizations. I also explored startup workspace at Venturef0rth, Novotorium, Indy Hall and how entrepreneurs interact in coworking spaces. Studying startups working in different spaces led me to observe them having meetings in coffee shops and food courts. I also followed two startups, Inhabi and Fit for Passion, for the course of two months. I observed team dynamics, team composition, and tried to gauge performance in order to see how these three may interrelate. As I did more literature research, I learned that some of these areas were already covered and I needed to continue researching in order to carve out a niche topic to apply the human centered design process. Many of these other areas are presented in Appendix C. Ethnography covered about three months of the research phase and overlapped with the first round of interviews. 48

Chapter Two: Field Research

Ethnographic Research and Networking 50

Chapter Two: Field Research

Problem Discovery First Round of Interviews The ethnographic research also served the purpose of networking in order to find the right people to interview for this thesis. On the next few pages, you will see the faces of Philadelphians that consider themselves a part of the startup community. The first round of interviews served to focus the scope of the thesis and reveal challenges this community faces. Formally, I interviewed a total of ten individuals with backgrounds as designers, novice and experienced entrepreneurs, community organizers, and technology developers. A few of these interviews took place over email but the majority of them were in person at coffee shops. Informally, at networking events, startup weekends, and happy hours, the number of informal interviewees jumps to roughly fifty. In these informal instances, I would ask only one or two questions from my interview question list as a prompt to begin a discussion on Philadelphiaâ&#x20AC;&#x2122;s startup ecosystem and entrepreneurial mentorship. This first round of interviews overlaped with ethnography and lasted about two months. You can see the questions I asked entrepreneurial mentors on the following page. Questions I asked designers, entrepreneurs, and developers have been excluded. Highlights from interview data can be seen in the next few pages.

Question 1 Would you consider yourself a mentor for internet/tech startups? What do you think qualifies you as an internet/tech startup mentor?

Question 2 When it comes to mentoring, what is your thought process when deciding that startup “X” is able to be mentored, or startup “Y” is not?

Question 3 Have you ever mentored a seed/early stage tech startup? What motivated you to advise that startup, and how did you connect with them?

Question 4 Do you think the current venues for mentors and start-ups to meet are working (I.e. happy hours, Founder’s Factory, Tech Meet-ups, Incubators, etc.)? Why? 52

Chapter Two: Field Research

Highlights from the First Round of Interviews

“I think it’s a missing link, having more people give back helping mentoring and advising.”

“I’m doing a lot of mentoring and advising at the moment, and that’s one of the things we can improve upon in this town.” 53

“Yeah, as long as they [mentors] have connections to funds they have an impact. And if they don’t have connections to funds, then they have no impact at all.”

“Mentors speed up interpreting the metrics and figuring out how to act on them.”

“If you show investors some traction, the rest of the conversation becomes a lot easier.”

“I genuinely think we NEED traction to really attract other rounds of funding with bigger dollars.”

Chapter Two: Field Research

“Mentors help in determining what metrics to be measuring.”

“Mentors are a point of traction.”

“Philadelphia is notorious for having this do-it-yourself attitude that eschews mentorship and advisory, but the reality is, you can’t do it yourself.”

“It’s not just difficult to find mentors for start-ups in Philadelphia, but also mentors for ones own professional career.”

Problem Discovery Analysis of First Round of Interviews From interviews, I learned entrepreneurs seem to have three major concerns: traction, mentors, and funding. These three areas are also related to each other. When startups want funding from investors, usually, they have to prove they have some sort of traction, and a mentor sometimes proves to be a point of traction early on. On the opposite page, youâ&#x20AC;&#x2122;ll see an example of mentors as a point of traction. The event in the two pictures is known as a family and friends round, which means the startup tries to convince their family and friends to Traction Mentors loan them money. Towards the end of the startupâ&#x20AC;&#x2122;s pitch, I observed that the team gave an introduction to the credibility of their mentor and his years of experience. Their mentor came up and spoke highly of them. Funding Their mentor reassured the audience by professing his trust in the team as a method to pursuade the audience to have faith and believe in the capabilities of the team. Mentors lend their credibility to the discovery stage startup, and thus, act as a point of traction. By lending their credibility, they reassure investors that their funds are in safe hands. In turn, funding allows the startup to set up more experiments to test how well their product or service fits in the market. Essentially, it becomes a cycle. In some cases, some amount of traction is needed to get the attention of the mentor, which then permits funds to be raised in order to propel the business even further than before. 56

Chapter Two: Field Research

Family and Friendâ&#x20AC;&#x2122;s Round 57

PSL ListServ Streamgraph Visualized by Ben Farahmand || www.benfarahmand.com

ohours

fund funds funding

invest investment investor investors

venture capital

traction measure measuring metrics metric growth

mentor mentors mentoring mentorship

October 2011

September 2011

August 2011

We can observe in the graphic that there is a lot of discussion regarding help, there’s very little mention of mentorship, while funds, investment, and venture capital fluctuate regularly. If we place this infographic in the context of the first round of interviews and the quotes I highlighted, it seems safe to say that there’s very little mentoring going on in Philadelphia for startups.

July 2011

The source of this infographic is several thousands of emails sent over the Philly Startup Leader’s (PSL) Listserv, and are publicly available in their archives. To understand how these three themes recur in the communication in the greater Philadelphia startup community, I wrote a data visualization software that analyzed word frequencies based upon the months. Each word frequency per month was then normalized and graphed. This type of data visualization is known as a stream graph and is best used to show evolving pieces of data in comparison to other pieces of information within the same dataset.

June 2011

Discovering these three themes from interviewees, I compared these themes to the rest of the startup community. The purpose of this activity is to check the prevalance of mentoring vs traction vs funding in the community at large by analyzing word frequency over time.

December 2012

November 2012

September 2012

August 2012

July 2012

June 2012

May 2012

April 2012

March 2012

February 2012

January 2012

help

December 2011

November 2011

Chapter Two: Field Research

advice advise advising coach coaching

Problem Discovery Identifying Resource Allocation through Mapping Philadelphiaâ&#x20AC;&#x2122;s Startup Ecosystem After deciding to focus on mentorship, it was necessary to identify where mentors are located, how they are perceived to be distributed, and their perceived level of influence within the ecosystem. Mentors are a resource within any startup ecosystem, and to find them a map is required. To create a map it is necessary to understand the varied perspectives by grouping interviewees into categories that define the role they play within the ecosystem. These different categories include: service providers, coworking spaces, startups, incubators and accelerators, investors, community organizations, and universities. Once organized into groups, I realized there is an exchange of "stuff" that allows each group to continue to operate within the ecosystem. This "stuff" included funds, equity, labor, experience, people, deal flow, credibility, sponsorship, experience, and workspace. At its simplest, it is the ebb and flow of human interactions. It gives rise to organism-like structures that can be identified from how the people within the startup ecosystem group together. Furthermore, grouping people and the organizations they are a part of into these quasi-defined structures allows for one to analyze the interactions between those groups.

Chapter Two: Field Research

Philadelphia Information Technology Startup Ecosystem

Universities Need students. Want better reputation.

people

peop

UPenn Drexel Temple UArts

Philly Tech Meetup Philly Startup Leaders Startup Weekend PACT

hip ors ns sp o

Interested in downloading this map? Scan the QR or follow the link.

First Round Capital Edison Ventures Osage Partners New Spring Capital

Investors Need investments. http://www.benfarahmand.com/ 2013/01/startups-in-philadelphia.html 62

fund

credibility

Community Organizations Need sponsorship. Want to build community.

Chapter Two: Field Research

Service Providers Want clients.

Want more entrepreneurs.

er v

rks

s us rio

ns ors hip

va ice

sp o

Coworking Spaces

Indy Hall Venturef0rth Seed Philly

Advertisers/Marketers Accountants Lawyers Software Development Firms

ne mo

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Startups Need customers. Want mentors. Want funding. Want workspace.

venues for networking

fun

ip rsh

ds ,w

ork sp ac

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Incubators & Accelerators Need investments.

DreamIt Ventures Good Company Group Novotorium

This map of the Philadelphia Tech Startup Community is a tool to understand the relationships between various actors and how they interact to support entrepreneurs as they build new businesses. The relationships depicted here are broad brush strokes and do not capture nuances between the different groups. 63

Problem Discovery Second Round of Interviews: Tangible Interviews You will notice on the opposite page a series of images that depict the map from the previous page. The map of the Philadelphia Startup Ecosystem was used to capture the deeper perspectives of individuals within the ecosystem. Borrowing concepts from cognitive science and its role in structuring effective interactions, I developed a strategy for creating an engaging interview, which I am calling the tangible interview. The concept behind the tangible interview is to enable the interviewee to physically represent information. The interviewee not only talks about the information, but can also see it and feel it. The tangible interview permits a better â&#x20AC;&#x153;graspâ&#x20AC;? of the information being communicated. The effectiveness of the tangible interviews lies in its ability to create an existing structure for the information. Thinking about a question and answer survey of a typical interview is one way to structure the output of information; however, verbal communication limits the bandwidth of information that may be transfered. Furthermore, verbal communication also limits the types of individuals that may effectively convey what they actually mean by certain words. This interview was conducted as a game. I asked interviewees to wager how much they believed certain spaces had mentors and who were the most influential actors. I interviewed three mentors/community leaders and two entrepreneurs.

Chapter Two: Field Research

Problem Discovery Analysis of Second Round of Interviews After completing the tangible interviews, I came back to my studio and put up the research all over the walls. I looked at the differences, similarities, and also refined the ecosystem map. These interviews were set up to find out where people in the ecosystem believe they may find mentors in order to discover challenges that the entrepreneur may face while finding and accessing a mentor. The main takeaway from these interviews is a misperception about where entrepreneurs may find mentors. Entrepreneurs on the outside of accelerator and incubator programs believed that the majority of mentors could be found and accessed in incubators and accelerators. However, those on the inside of incubators and accelerators revealed they find mentors from previous founders of startups. Essentially, they find experienced entrepreneurs who have enough available time on their hands and are at a place in their life where they want to give back to the rest of the startup community. While asking entrepreneurs to point out where they find mentors and how many mentors are involved with their startup, the second takeaway I learned is entrepreneurs tend to have several specific mentors. Each mentor plays a specific role, providing feedback and strategic advice on a specific part of the business. Their mentors would provide strategic advice on areas such as customer acquisition, refining the business model, hiring team members, product development, financial related tasks, etc. For example, a particular entrepreneur I interviewed explained he formed a relationship with one of his customers, and this customer

Chapter Two: Field Research

has mentored him by providing strategic advice and feedback on how the product should be developed. These two takeaways revealed an important distinction: the generalist mentor and specialist mentor. Experienced entrepreneurs brought in by accelerator and incubator programs seem to fit the profile of a generalist mentor because they have experience dealing with more than a single area (product, team, financials, customer, business model). The specialist mentor, as the word implies, has a single specialty and is providing strategic advice and feedback on that area. As stated before in the second takeaway, the norm for entrepreneurs is to be in contact with several specialist mentors.

Problem Discovery Why Focus on Mentoring? At this point in the design process, I had discovered the importance of mentors, especially the role they play in the development of a startup. A few of the data points that were leading me to focus on mentoring include: “Hands-on help from investors has little or no effect on the company’s operational performance. But the right mentors significantly influence a company’s performance and ability to raise money.” - Startup Genome

Chapter Two: Field Research

“Founders that learn are more successful. Startups that have helpful mentors, track performance metrics effectively, and learn from startup thought leaders raise 7x more money and have 3.5x better user growth.” - Startup Genome Furthermore, I came across some disturbing data regarding the perception of where mentors are located. According to the tangible interviews, entrepreneurs believed mentors are located in incubators and accelerators.

Traction

Mentors

Funding

However, the mentors I interviewed knew that mentors are simply experienced entrepreneurs. With the perception amongst some entrepreneurs that they can find mentors by going to incubators and accelerators, I had also learned that in the top incubators and accelerators about 1 - 7 % of applicants that apply actually get in, which creates a barrier to accessing mentors only because there’s a misperception amongst some entrepreneurs. Essentially, I realized that a mentoring system is required for aiding entrepreneurs in accessing mentors. What followed is a discovery of a mentoring model that was more complex than I had previously imagined.

“YCombinator ... has an acceptance rate of around 3%.” - YaleLawTech.com, December 17, 2011 “Techstars NYC ... an acceptance rate of only 1.1 percent.” - NYConvergence. com, July 12, 2011 “Startup Sauna ... acceptance rate went down from 23 percent in the first batch to 7 percent for in 2011.” - TechCrunch.com, January 27, 2012

Problem Discovery Relationship: Experienced and Novice Entrepreneurs From the second set of interviews, one of the individuals described the way her organization goes about matching mentors and entrepreneurs. That interview then led to a series of interviews revealing the exchange of value between experienced and novice entrepreneurs, their motivations, and characteristics. The following graphic visualizes the concepts that were discovered during these interviews. This interaction lays the groundwork for the next section, which is about framing the interaction between mentors and entrepreneurs into three parts: pre-meeting, meeting, and follow-up. Please notice, in this section I am using experienced entrepreneur interchangeably with mentor. The reason for this is because I am looking for the characteristics and motivations that turn an experienced entrepreneur into a mentor.

Experienced Entrepreneurs

Value

Novice Entrepreneurs

Interface Motivation to Mentor

Characteristics of a Mentor

Value

Motivation to be Mentored

Characteristics of a Mentorable Entrepreneur

Chapter Two: Field Research

Experienced Entrepreneurs

Value

Novice Entrepreneurs

Interface Motivation to Mentor

Characteristics of a Mentor

Value

Motivation to be Mentored

The motivations behind a mentorâ&#x20AC;&#x2122;s relationship with an entrepreneur and the early stage startup may fit into several categories. These categories include: altriusm, desire to learn, desire to help, interest in the startupâ&#x20AC;&#x2122;s domain, passionate about the project or team, ego, and satisfaction. Finally, if itâ&#x20AC;&#x2122;s a long-term relationships, the mentor occasionally receives equity in the startup.

Certain qualifications and characteristics of a mentor may be needed in order to be a useful mentor to an early stage startup. These qualities include: good at listening and asking the right questions, has been an entrepreneur and gone through the entire startup process from start to finish, and willingness to share past experiences and personal connections. The value the mentor provides the entrepreneur includes: perspective and focus, challenge and accountability, and opens doors via personal connections.

Characteristics of a Mentorable Entrepreneur

Motivation to Mentor

Characteristics of a Mentor

Value

Experienced Entrepreneurs

Value

Novice Entrepreneurs

Interface Motivation to Mentor

Motivation to be Mentored

Characteristics of a Mentorable Entrepreneur

Value

Characteristics of a Mentor

Value

Motivation to be Mentored

Characteristics of a Mentorable Entrepreneur

The novice entrepreneur has several reasons to be motivated to seek out mentoring. These motivations include: a need for a big picture perspective, insight, feedback concerning the startup, and a desire to be introduced to people that will help move their business forward.

The following characteristics describe an entrepreneur that can and wants to be mentored: needs to be teachable, shows potential, has a certain familiarity with their market, passionate about solving the problem, and interested in generating value for their customers.

The value the entrepreneur provides the mentor includes: new ideas, vicarious experience, possible equity stake, a test bed for solving new problems, a way to give back to the entrepreneurial community.

Chapter Two: Field Research

Experienced Entrepreneurs

Value

Novice Entrepreneurs

Interface Motivation to Mentor

Characteristics of a Mentor

Value

Motivation to be Mentored

To create a match between the mentor and the entrepreneur, an interface that filters, sorts, and matches is necessary. The criteria for this interface include: domain of the startup, role of the mentor (marketing, tech, finance, businesss development, etc), types of problems interested in, industry experience and connections, and the amount of time available.

Characteristics of a Mentorable Entrepreneur

Interface

Framing the Problem Framing the problem is part two of the field research. Having discovered that the area to focus on is mentoring and the interaction that takes place between the experienced entrepreneur and the novice entrepreneur, the next step was to go into more depth with this interaction and discover its nuances.

Experienced Entrepreneurs

Value

Novice Entrepreneurs

Interface Motivation to Mentor

Characteristics of a Mentor

Value

Motivation to be Mentored

Characteristics of a Mentorable Entrepreneur

Over the second part of the field research, youâ&#x20AC;&#x2122;ll come to understand the three part model of interaction: the premeeting, meeting, and follow-up. Within each of these parts are smaller pieces that influence, either as a hinderance or enabler, the transfer of knowledge and experience from the experienced entrepreneur to the novice entrepreneur in the context of a mentoring relationship.

Chapter Two: Field Research

Pre-Meeting

Meeting

Follow-Up

{ { {

Busy Schedules

Trust

Serendipity

Identification

Long-Term

Planned

Short-Term

Serendipitous

Actionable Steps

Learning

Valuable Insight

Outcome

} } } 75

Framing the Problem: Pre-Meeting Finding and Accessing the Right Mentors The Startup Genome brings up the factor of the “right mentors” and how they positively influence the startup's ability to raise funds. However, the startup genome doesn't articulate what it entails to be the right type of mentor. In order to discover the “right” types of mentors for startups, I conducted interviews with novice entrepreneurs, experienced entrepreneurs, and read through academic research. A novice entrepreneur and I at Philly Tech Meetup’s happy hour were discussing why he would want a mentor. He said, “mentors speed up interpreting the metrics and figuring out how to act on them.” He went on to add, “mentors are good at pattern matching." We continued our discussion in an email dialogue. I asked him to described what a great mentor would look like for his company. He defined a “great” mentor as an individual with “deep

https://www.youtube.com/watch?v=pWoSSjoZLo0 76

Chapter Two: Field Research

https://www.youtube.com/watch?v=RKJHTR1S38A

knowledgeâ&#x20AC;? of their respective industry, to â&#x20AC;&#x153;have connections to others to fill in gaps in their, [the startups] experience, and business links that would help grow the company." According to this entrepreneur, the right mentor is a well connected and deeply knowledgeable individual in one or more industries, with the respective business experience to go with it.

https://www.youtube.com/watch?v=hqUNaBGn3h0 77

https://www.youtube.com/watch?v=qWnvTw6NxX4

In one of my interviews with the startup Inhabi, I learned that theyâ&#x20AC;&#x2122;ve already attracted their first set of paying customers. They've been setting up experiments to test one product feature over another, and they currently have a lot of data on their users. From their perspective, they also believe that mentors are good at â&#x20AC;&#x153;pattern matching" for the purpose of making decisions on data that has been acquired during product tests. This startup seemed

http://www.youtube.com/watch?v=TBJ4lBcDNnY 78

Chapter Two: Field Research

interested in making sense of data they were acquiring because they're concerned about how to acquire more customers. Another entrepreneur from the startup Dine&Ditch said when finding a mentor, "[I] tend to look for weaknesses of core competencies of specific aspects of the business model and team.â&#x20AC;? This means he finds holes in his startup and finds mentors that can fill those holes. While interviewing various entrepreneurs, I discovered that it is the norm to have several mentors at the same time. Whether that mentor is providing strategic advice on how to refine the product, the business model, or even customer acquisition, it is also the norm to have each mentor satisfy one particular area of expertise for the novice entrepreneurâ&#x20AC;&#x2122;s business. From this data, it seems that the right type of mentor for a startup, or novice entrepreneur, is a person with expertise and connections in an area the novice entrepreneur or the startup team lacks. However, there is a distinction to be made about the breadth of expertise required. It seems sufficient to find several mentors with specific expertise than find a single individual with several areas of expertise. However, this is the entrepreneurâ&#x20AC;&#x2122;s perspective. The mentor identifies the right entrepreneur from a different set of criteria. The most important criteria is the entrepreneur needs to be coachable, and they identify coachability by listening to the questions they ask. This seems to hit upon a key area regarding the culture of the entrepreneur and the culture of the mentor. If their cultures do not seem to fit, the mentor may view the entrepreneur as uncoachable or the entrepreneur may view the mentor as close-minded. Even though this thesis did not look into mentor and entrepreneur

Identification

culture, it is an area that could be of further study. Identification alone is not enough to spawn a mentoring relationship. Other factors such as busy schedules, serendipity, and trust also play an important role in hindering or enabling a new mentoring relationship.

Busy Schedule

Serendipity

Trust

From interviews and observations, we can conclude that having busy schedules acts as a hinderance to permitting entrepreneurs and mentors from meeting face-to-face. From interviews, I learned that serendipity means two things to the entrepreneurial community, a missed connection and how relationships form. Imagine yourself at a networking event, and you are looking for a person with an expertise in retail marketing in a crowd of people to mentor you and provide advice about what retailers your business should partner with. Instead, you get stuck talking to the lawyer for thirty minutes, and completely miss the person you should have been talking to on the other side of the room. This is an example of a missed connection. In an interview with a local mentor explaining how he’s met and formed relationships with young entrepreneurs, he said, “... most of it is very serendipitous ... that’s how real relationships form. It is pretty hard to find your soul mate at a speed-dating session. Mentorship is a highly personal experience.” This means serendipity can be both an enabler and hinderance to forming a mentoring relationship. Trust is another pillar governing mentor-entrepreneur interactions. A local angel investor I interviewed recounted his experiences of organizing exclusive groups and meetings. He argued that the people in the group, even if they do not know each other, they trust each other because the exclusivity tacitly communicates

Chapter Two: Field Research

everyones value to everyone else without the need of an existing relationship. After my interviewee pointed this out, I began noticing it with other exclusive groups, i.e. universities, incubators and accelerators, etc. I think this is why an introduction from a friend proves to be effective when you are applying to a job or even meeting a romantic interest. Learning about trust as one of the underpinnings governing the interactions and meetings of entrepreneurs and mentors makes sense because it lowers the transaction cost on the exchange of information, knowledge, and experience. This interpretation of the interaction between mentor and entrepreneur is emphasized in The Rainforest by Hwang and Horowitt. They argue that the amount of distrust increases the transaction cost between people that want to exchange ideas, labor, and capital - the life and blood of any startup ecosystem. If there is a higher distrust in a startup ecosystem, then there are fewer transactions occurring between the various denizens of that ecosystem. In other words, people are not willing to seek a return on involvement (as opposed to a return on investment), because there is a certain amount of risk associated with each transaction. If the risk is too high, and there is not enough trust to make up for that risk, then the transaction will not occur. In summary:

Pre-Meeting

{

Busy Schedules

Trust

Serendipity

Identification

} 81

Framing the Problem: Meeting Classifying Mentor-Entrepreneur Interactions There seem to be four types of interactions between mentors and entrepreneurs: serendipitous, planned, long-term, and short-term.

Serendipitous

Planned

Long-Term

Short-Term

Serendipitous mentoring occurs at events like Startup Weekend or Philly Tech Meetup, and has been observed to occur at coffee shops. Just as the word implies, serendipitous is unplanned, and even though neither party knows they are going to be in the same space at the same time, they discuss business and the mentor provides personal or strategic advice. Planned mentoring tends to occur over the phone, video chat, face-to-face in office space or even at coffee shops. Planned meetings are more secluded and are set for a specified amount of time when compared to serendipitous meetings. Long-term mentoring is a type of mentoring I have not observed because it would increase the amount of time needed to complete this thesis. However, the literature speaks of it and some of my interviewees talk about it as well. From these sources, I understand long-term mentoring to be a strong-tie relationship between the experienced and novice entrepreneur, and these relationships last from a few months to many years. Short-term mentoring means the mentor and entrepreneur have not yet developed a long-term relationship. All long-term relationships must go through the short-term in order to see if the two fit together.

Chapter Two: Field Research

Serendipitous 83

Planned 84

Chapter Two: Field Research

Each of these four categories intersect in a two-by-two grid. On the x-axis is time and the y-axis is intention (or lack thereof). This chart is relevant because when it is filled out, it reveals the examples of interactions that occur. This thesis focuses on planned interactions and is remaining agnostic towards the temporal length of the mentoring relationship. The reason for focusing on the planned variable is due to limitations of the scope of the thesis and the amount of time available to conduct a thorough study.

Planned

Open Office Hours (Ohours.com)

Advisor/Board positions, Monthly meetings

Serendipitous

Networking Events

I donâ&#x20AC;&#x2122;t believe there are any examples.

Short-Term

Long-Term

In summary:

Meeting

{

Long-Term

Planned

Short-Term

Serendipitous

} 85

Framing the Problem: Meeting Data on Planned Interactions The purpose of gathering data on planned interactions is two fold. First, they serve as a baseline set of measurements before a prototype is implemented. Second, in order to design for the planned mentoring conversations, it is necessary to observe how mentors and entrepreneurs naturally interact without any prototypes in place. In other words, understanding human nature when it comes to mentoring conversations will give way to a human design. For example, if I were to design a computer mouse without understanding and researching the human hand, I will most likely develop an uncomfortable and unusable computer mouse. This analogy holds for why we must understand how mentors and entrepreneurs interact during their conversations. On the following pages you will see timelines, bar graphs, and pie graphs based on audio recordings collected over the course of several months. They have been abstracted to protect the identities of the individuals. On the opposite page you will see colored categories. These categories serve as a legend that will reveal what is going on within each mentoring conversation.

Chapter Two: Field Research

Conversational Themes and Observations Current/Past Strategy Current/Past Strategy denotes whenever the mentor or entrepreneur discuss where the entrepreneurâ&#x20AC;&#x2122;s business currently is or has been.

Future Strategy Future Strategy is a discussion about steps that can be taken to move the business forward.

Questions Everytime a question is asked, it appears as a red line.

Examples Real world examples are used in several ways by both the mentor and entrepreneur. They are used to learn from competitorsâ&#x20AC;&#x2122; strategies. Some times examples of potential customers are discussed to notice how a market segment may be profiled for product-market fit. Other times, they are metaphorical to convey a concept about human nature and business strategy.

Small Talk Small talk is time spent talking about items not relevant to the business, like the individualâ&#x20AC;&#x2122;s personal life and struggles they face or even cracking a joke.

Agenda Time spent discussing what should be covered during the meeting or what should be discussed next is categorized as agenda.

Application Whenever an example is presented in conversation, it is usually applied to the entrepreneurs current situation.

Entrepreneurial Efficacy Entrepreneurial efficacy is time spent giving personal advice to the entrepreneur about being an entrepreneur and how to grow as an entrepreneur.

Mentoring Session 1 - Idea Stage Entrepreneur Current/Past Strategy

Small Talk

Future Strategy

Agenda

Questions

Application

Examples

Entrepreneurial Efficacy

~[02:10] ~[00:30] ~[00:20] ~[00:30]

{ 3 questions } { 5 questions }

~[10:35] ~[09:25]

~[09:00]

~[03:30] ~[02:30] ~[00:50] 88

~[01:30]

~[00:30]

Chapter Two: Field Research

Mentor 35.53% 9.43%

[mm:ss]

Mentor

Entrepreneur [00:00]

39.94% 5.66%

[04:30]

8.18% 1.26%

[09:00]

23.60%

[13:30]

Entrepreneur

3.37% [18:00]

5.62% 60.67%

[22:30]

3.37% 3.37%

[27:00]

31.25%

[31:30]

Both

7.26% 27.62%

[36:00]

25.40% [40:30] [44:30]

6.45% 2.02%

[45:00]

Mentoring Session 2 - Idea Stage Entrepreneur Current/Past Strategy

Small Talk

Future Strategy

Agenda

Questions

Application

Examples

Entrepreneurial Efficacy

~[21:00]

{ 5 questions } {39 questions}

~[08:10]

~[03:50]

~[03:30]

~[01:00] [00:00] 90

~[03:45]

Chapter Two: Field Research

Mentor 13.41% 0%

[mm:ss]

Mentor

Entrepreneur [00:00]

73.47% 0%

[04:30]

13.12% 0%

[09:00]

Entrepreneur 6.19%

[13:30]

0% [18:00]

21.65% 50.52%

[22:30]

21.65% 0%

[27:00]

10.80%

[31:30]

Both

0% 54.75%

[36:00]

18.25% [40:30] [44:30]

16.20% 0%

[45:00]

Mentoring Session 3 - Launch Stage Entrepreneur Current/Past Strategy

Small Talk

Future Strategy

Agenda

Questions

Application

Examples

Entrepreneurial Efficacy

~[02:30] [00:00]

~[00:45]

[00:00]

~[00:30]

~[09:20]

~[08:45]

{14 questions} { 5 questions }

~[08:10]

~[02:20]

~[02:10] ~[00:45] 92

~[01:20]

~[01:00]

Chapter Two: Field Research

Mentor 10.69% 2.29% 37.40%

[mm:ss]

Mentor

Entrepreneur [00:00]

3.44% [04:30]

42.75% 3.44% [09:00]

Entrepreneur 6.35% [13:30]

13.76% 55.56%

[18:00]

8.47% [22:30]

15.87%

Both

7.52% [27:00]

1.13% 23.31%

[31:30]

36.65% 24.06%

[36:00]

5.64% 1.69%

[40:30]

Mentoring Session 4 - Launch Stage Entrepreneur Current/Past Strategy

Small Talk

Future Strategy

Agenda

Questions

Application

Examples

Entrepreneurial Efficacy

~[01:00]

~[01:40] ~[00:20]

~[00:00]

{ 5 questions } {18 questions} ~[10:30]

~[09:30]

~[06:00]

~[01:25]

~[01:00]

~[05:45]

~[01:40]

~[02:00]

Chapter Two: Field Research

Mentor 22.4% 1.30%

[mm:ss]

Mentor

Entrepreneur [00:00]

40.9% 5.52%

[04:30]

23.4% 6.49%

[09:00]

13.2%

[13:30]

Entrepreneur

6.59% [18:00]

10.99% 62.64%

[22:30]

6.59% [27:00]

Both 18.98%

[31:30]

3.26% 29.80%

[36:00]

26.73% [40:30]

17.14% 4.08%

[45:00]

Mentoring Session 5 - Launch Stage Entrepreneur Current/Past Strategy

Small Talk

Future Strategy

Agenda

Questions

Application

Examples

Entrepreneurial Efficacy

[00:00] ~[00:05]

{26 questions} { 4 questions }

~[10:40] ~[09:20]

~[09:10] ~[07:30]

~[03:00] ~[01:05] 96

~[01:10]

~[00:28]

Chapter Two: Field Research

Mentor 34.36% 0.31%

[mm:ss]

Mentor

Entrepreneur [00:00]

27.61% 3.99%

[04:30]

33.74% [09:00]

Entrepreneur 3.05%

[13:30]

0% [18:00]

19.61% 69.72%

[22:30]

7.63% [27:00]

Both 23.08%

[31:30]

0.20% 24.73%

[36:00]

27.67% [40:30]

24.33% [45:00]

Framing the Problem: Meeting Analysis of Interactions

Outcomes

One important discovery is setting an agenda so the mentor knows the desired outcome. If we look at mentoring sessions three and four, they look very similar when comparing the timelines of the conversation. Except, in a follow-up survey entrepreneur three was not able to discuss what he wanted and did not have a successful outcome while entrepreneur four had a successful outcome. The only observable difference between the two is the amount of time the entrepreneur spent setting an agenda for the meeting and informing the mentor what he wanted out of the meeting. Furthermore, the amount of time required to go through this four step process seems to range anywhere between 15 minutes at the minimum to 45 minutes at the maximum This range in time also seems to depend on whether the entrepreneur is at the idea stage, launch stage, and how familiar he or she is with the strategic area being discussed. The entrepreneurâ&#x20AC;&#x2122;s familiarity with the strategic area determines the amount of teaching the mentor needs to do thus, influencing the amount of time needed.

Learning

A pattern surfaced while studying the recordings of mentoring sessions. Regardless of the strategic area being discussed, I discovered that the flow of conversations between mentor and entrepreneur usually unfolded the same way and involved the same ingredients. The conversation followed a four step process: strategic area, known facts and data, tried and tested strategies, and possible future scenarios. These four steps did not have to occur sequentially and the mentor and entrepreneur would jump back and forth between the different conversational areas. Finally,

Chapter Two: Field Research

Conversational Pattern 1

Strategic Area These strategic areas include business development, customer development, finance, fundraising, legal, marketing, operations, product development, sales, team, and more.

Known Facts & Data Data from the Mentor’s Experience

Tried & Tested Strategies Strategies from the Mentor’s Experience

Data from the Entrepreneur’s Experience

Strategies from the Entrepreneur’s Experience

Possible Future Strategies Based on Facts & Strategies

it seems that these four steps are necessary for entrepreneurial learning. However, it is inconclusive to say that these four steps are sufficient for entrepreneurial learning to occur because there are a variety of variables that can influence entrepreneurial learning during and after the mentoring session. The importance of communicating outcomes to the mentor is an example of another variable influencing entrepreneurial learning. Usually, these outcomes are communicated in the agenda phase of the conversation. Another variable influencing learning during these mentoring conversations are the questions the mentor asks. The reason the questions are vital to entrepreneurial learning is because it focuses the entrepreneurâ&#x20AC;&#x2122;s problem solving abilities on to a particular area. I conjecture that the entrepreneur may become capable of asking the right questions after prolonged conversations over several sessions with a mentor. I would also guess that the questions a mentor asks reveals his or her thought processes for analyzing entrepreneurial problems. As an example, I have provided mentoring session 2 on the opposite page, so you can see the progression of questions that are intended to aid the idea stage entrepreneur with focusing on a particular area and figuring out actionable steps to bring his idea to reality.

100

Current/Past Strategy

Small Talk

Future Strategy

Agenda

Questions

Application

Examples

Entrepreneurial Efficacy

Chapter Two: Field Research

Mentoring Session 2 - Idea Stage Entrepreneur [mm:ss]

“What makes you so unique? Have you even gone onto Youtube to look at competition?”

Mentor “What makes you different?”

“How is that going to work on a website?”

“What’s the proposition for them, why would they want to join you?”

“Are you a trainer? Are you a nutritionist? You don’t have qualifications?” “What’s the proposition for them, why would they want to join you?”

“What’s your number one competitor?”

Entrepreneur [00:00]

[04:30]

“What are your competitors business models?”

“Is what you believe different and unique?”

“What’s your unique philosophy?”

[09:00]

“What are your competitors business models?” “Get where I’m going with this?”

[13:30]

“Get what I’m saying?” “What’s the hook?” “What is your message?”

“Have you ever trained with anybody?”

“Who sponsors this group?”

“Did you ever think that the starting point might be... you? Have you written down your story?” “How unhealthy were you? What decisions were you making?”

[18:00]

“See where I’m going with this?”

[22:30]

[27:00]

“So tell me about, tell me about your story? What’s your story?” So how do you become that person, that leads, the vangaurd that tells the people? “Does it make sense?”

[31:30]

“So the issue is, why follow you? And what would compel me to follow you is your story.”

“What happened? How did you feel? What was going on in your life? What got you to take action?” “What was going on in your life? What was restricting you?”

[36:00]

[40:30] [44:30]

“What’s your story? What’s going to make it so important for people to talk to you?” “What is it about your story that you can help them?” [45:00]

101

Framing the Problem: Follow-Up What happens after the mentoring session? To see if entrepreneurial learning is occuring after the mentoring session, I had to follow-up with entrepreneurs to see how they interpretted the advice, experience, feedback, and knowledge retained from the mentoring session. Even though I recorded and analyzed ten mentoring sessions, only four entrepreneurs responded to the follow-up survey. That was still enough to notice a few patterns regarding how the entrepreneur went from the session to taking actionable steps. Actionable Steps

Valuable Insight

Of the entrepreneurs that responded, all of them were able to take actionable steps to move their business forward after the mentoring session was over. Another commonality amongst these four entrepreneurs that responded is how they value the insight the mentors provide. The entrepreneurs found valuable insight when the mentor pulls from their own experience and applies it directly to the entrepreneurs current situation.

Follow-Up

102

{

Actionable Steps

Learning

Valuable Insight

Outcome

}

Question 1

What did you find valuable during your advising session? Why?

Question 5

Did you have an objective or outcome for the meeting before it began? Did you obtain that objective or outcome?

Question 2

Did you feel you were able to discuss everything you wanted during the mentoring/ advising session? Why?

Question 3

Have you implemented any ideas/strategies/ specifics discussed during your conversation? Why?

Question 4

Question 6

Did you know how to go from the advising session to coming up with actionable steps on any of the ideas/strategies you highlighted as valuable?

How do you determine if an idea/strategy is worth executing on?

Can you compare how you felt about the ideas/strategies discussed during the conversation with how you felt about the ideas/strategies after youâ&#x20AC;&#x2122;ve had several days to think about them? Essentially, was there a change in what you thought was more important or less important after some time had passed?

Question 7 103

In Summary... Pre-Meeting

Meeting

Follow-Up

{ { {

Busy Schedules

Trust

Serendipity

Identification

Long-Term

Planned

Short-Term

Serendipitous

Actionable Steps

Learning

Valuable Insight

Outcome

} } }

Chapter Two: Field Research

Chapter Three: Design Solutions This chapter discusses the mentor system that is designed around the pre-meeting, meeting, and follow-up structure for interactions between mentors and entrepreneurs.

106

107

Prototyping Within the context of the design process, prototyping is a form of validation. It reveals unseen assumptions while researching and communicating entrepreneurial mentorship. Prototyping creates a tangible form for the members of the entrepreneurial community to see, touch, and respond with feedback. The key element that requires feedback is the three part model describing the interaction between mentor and entrepreneur. In the context of systemic problems and solutions, specifically the three part mentor interaction, prototyping permits parts of the system to be tested without the need to build the entire solution at once.

The Mentor System The development of this solution was not a straight forward process. Originally, when the focus of the thesis was just about the pre-meeting phase, I designed a solution called the Request for Mentoring (RFM) form, which was intended to enhance knowledge and experience transfer by starting the mentoring conversation before the mentor and entrepreneur meet face-to-face. When I validated this form with Garrett Melby, he sketched out a system that could incorporate the RFM form to help entrepreneurs easily access mentors. When I looked over his sketch, I realized I could refine his knowledge by communicating this mentor system to other mentors for feedback. In a sense, the model for interaction was developed backwards. After the mentor system was partially

108

Chapter Three: Designed Solutions

formed and validated with mentors from the entrepreneurial community, I had to go back and define the model of interaction in order to develop a foundation for the system. The mentor system was designed and developed through several dozen meetings with mentors within the entrepreneurial community in Philadelphia. Specifically, I met with Garrett Melby, Angel Rodriguez, Aaron Mclean, Richard Binswanger, Richard Genzer, and Neil Kleinman. Furthermore, the solution takes into account the natural progression of a mentoring session, by aiding the entrepreneur in setting outcomes for his or her mentoring session. This process removed me as the locus of action for designing a solution. Instead, the community proposed and refined its own solution. During this process I had to do two tasks. First, communicate the mentor system so each mentor could respond to it. Second, was to synthesis opposing opinions and understand why certain features of the mentor system operated the way they did. Now, in retrospect, I can argue the mentoring system is a solution intended to meet the need of the three part mentor interaction: the pre-meeting, meeting, and follow-up. On the following pages, you will see an overview of each component of the mentoring system and how they interact with each other. Throughout the following pages we will be going into greater detail about each component. All iterations of the mentor system can be see in Appendix A accompanied with notes regarding the development of each iteration.

109

The Mentor Interaction Pre-Meeting

Meeting

Follow-Up

110

{ { {

Busy Schedules

Trust

Serendipity

Identification

Long-Term

Planned

Short-Term

Serendipitous

Actionable Steps

Learning

Valuable Insight

Outcome

} } }

Chapter Three: Designed Solutions

The Mentor System Pre-Meeting

Entrepreneurs

Mentors

Entrepreneur Intake

Mentor Intake

Entrepreneur Profile

Mentor Profile

Request for Mentoring

Electronic Matching

Meeting

Mentoring and Advisory Session

Follow-up

111

The Latest Iteration of the Mentor System

Entrepreneurs Original Candidate Group

Mentor System

Organizations Local Mentoring Organizations

Good Company Group Corzo Center Empowerment Group Philly Startup Leaders Cofounders Bridge

Pre-Mentoring Intake

Science Center Philly Tech Meetup Sustainable Business Network Enterprise Center

Sign-up for Service Each Mentor signs up with Certain Areas of Expertise

level of customer development. (Steve Blank, Four Steps to the Epiphany)

Digital System

Request For Mentoring

Idea Stage

Launch Stage

Operating Business

Screen each business for where they need the most help and where they should focus.

Request Review

Processed by the System

Finance Fundraising

Legal

Marketing

3 4

The Request Review is a summary of the areas the entrepreneur needs the most help. The system takes into consideration the entrepreneurâ&#x20AC;&#x2122;s problem areas, industry, schedule and availability and

Customer Development

RFM

Business Development

The Request for Mentoring (RFM) is processed and sent electronically to mentors signed up with the mentoring and advisory network as a Request Review (RR).

Operations Product Development

2 4

Sales Team

Each mentor then chooses their industry, provides their available times, and how long they would like to meet Request Review

Early Stage Strategy Interview

Self-Diagnose Industry

Mentoring Ready

If you are interested in downloading and seeing the entire map in detail, you can scan the qr code or follow the link: http:// www.benfarahmand. com/2013/02/ mentoring-systemiteration-4.html

Duration

The mentors may then agree to meet based upon their availability and interest.

Idea Stage

Request Review

Early Stage Strategy

Request for Mentoring (RFM)

If the mentor agrees to meet, an email is sent out to both the mentor and entrepreneur, with a date, time, location, agenda, and problem descriptions.

Mentoring and Advisory Session An entrepreneur submits a RFM and selects three strategic areas.

After the mentor and entrepreneur have corresponded over email, they meet for a mentoring session.

Business Development Customer Development Finance Objective for the Meeting

Fundraising

Follow-up

Legal

Before the entrepreneur can send another RFM,

Operations Product Development Sales Team Objective for the Meeting

Mentor 1. Was the entrepreneur prepared? (1-5) they can gather data immediately? (1-5) 3. How receptive were they to new ideas? (1-5) 4. How inquisitive/dismissive were they? (1-5) 5. Do you want to follow-up? 6. Should they follow-up with someone else? 7. What category of expertise should they meet with next? 8. Was the objective for your meeting obtained?

Launch Stage

Operating Business

Mentors and Advisors

Marketing

Entrepreneur this past month towards your objective. taking this month towards your next objective. 3. Was the conversation with the mentor/advisor useful? (1-5) 4. Would you meet again with this mentor/advisor? (1-5) 5. Would you recommend others to meet with this mentor/advisor? (1-5) 6. Was the objective for your meeting obtained?

}

112

Schedule

Each mentor also lets the system know their preferences for meeting with idea stage, launch stage, or operating businesses.

{ {

Business Development Customer Development Marketing Team

Legal Finance Fundraising Product Development

} }

Chapter Three: Designed Solutions

Pre-Meeting: Entrepreneur Intake The entrepreneur intake is a two step process. First, the entrepreneurs from the original candidate group funnel themselves into idea stage, launch stage or operating business stage. This first part of the intake also asks for the entrepreneurâ&#x20AC;&#x2122;s elevator pitch and contact information. The importance of this filter is to know whether the entrepreneur is ready to start a business or how far along the entrepreneur is in the startup process. When I met with Garrett, he mentioned the need to test if an entrepreneur is ready to start a business. This way, the mentor system does not squandor valuable resources on an entrepreneur that is not willing to follow through on their startup and the advice they are receiving. If you reference Appendix A, Iteration One, you will see where this entrepreneur intake first came to be part of the system. As I did more research to see how this segment of the mentoring system could be prototyped, a few different approaches surfaced. The first and easiest way is to have each entrepreneur physically meet a representative of the mentor system so that they can be interviewed. The second way, but would require more research, is to develop an interactive questionnaire that will funnel each entrepreneur into their appropriate categories.

113

Step 1

Idea Stage

Launch Stage

Operating Business

Each stage is defined based upon their level of customer development, which is discussed in Four Steps to the Epiphany by Steve Blank. At its most basic, if you do not know who your customers are you are still in the idea stage. If you know who your customers are, their pain point, and are building the first version of your solution, then youâ&#x20AC;&#x2122;re just beginning the launch stage. If you have just acquired a first customer with an early iteration of the product or service, you are in late launch stage. If you have many customers and are generating revenue, then you are an operating business.

114

Chapter Three: Designed Solutions

The second part of the filter has two components. The first component takes the idea and launch stage entrepreneurs and has them meet with an early stage strategist. The purpose of meeting with an early stage strategist is to help the idea and launch stage entrepreneur discover their problem areas, understand where they need to focus, and where they need the most help. The reason the idea and launch stage entrepreneurs meet with an early stage strategist is because entrepreneurs at these stages do not yet know how best to focus their efforts or even the order of actionable steps to start a business. There are two sources to confirm this insight. The first source are the mentors I interviewed. They believed that early stage entrepreneurs do not usually know

Step 2

Early Stage Strategy Interview

Self-Diagnose

Screen each business for where they need the most help and where they should focus.

115

where to focus their time and energy in identifying and solving a problem for their customer. The second source that confirms this insight are recordings of mentor conversations. The idea stage entrepreneurs from the recordings of each conversation were guided via questions posed by the mentor. Please draw your attention to the section Framing the Problem: Analysis of Interactions, and you will see an example of questions asked, which bring focus to a early stage entrepreneur. It is assumed that an operating business understands their problem areas well enough that they can self-diagnose the areas they need help. The second component takes the operating business and has it self-diagnose its problem areas by reporting to the mentor system where it needs strategic advice and feedback. The only source I have that can confirm this are the mentors I have spoken with. They believe operating businesses understand their problems well enough that they do not need aid focusing. The audio recordings I collected regarding mentoring conversations did not include any operating businesses.

116

Chapter Three: Designed Solutions

Pre-Meeting: Request for Mentoring The Request for Mentoring (RFM) form is designed to save time for the mentor. The mentors I interviewed expressed a dissatisfaction with the great length of time a mentoring session takes up. By analyzing the conversational data, the only part of the conversation that can be moved ahead of the meeting is past strategy because the rest of the conversation requires both parties to analyze and build future strategies together. Roughly 25% of the mentoring session is spent bringing the mentor up to speed about past strategies of the business. The RFM attempts to alleviate the mentorâ&#x20AC;&#x2122;s dissatisfaction by informing the mentor ahead of the meeting about the history of the startup, past strategies, and the outcome the entrepreneur has in mind. The RFM is based upon the mentoring pattern observed during mentoring sessions. The most important takeaway that applies to the RFM from the observations is the repetitive structure of mentoring conversations. Taking this pattern and making a form around it means that the entrepreneur may now communicate germane information to the mentor ahead of their meeting. Imagine a patient's form a doctor looks at as she determines where she should apply her medical expertise. The metaphor is the same â&#x20AC;&#x201C; except the startup is not a sick patient. On the following page, you will see the last iteration of the open ended RFM form. Testing this open ended form with early stage entrepreneurs revealed they had difficulty starting to write something for sections four to seven. I think the reason for this difficulty is the lack of scaffolding during the interaction with the form. Please see Appendix B for all iterations of the RFM form and notes on the development of each iteration. 117

Request for Mentoring The following questions will help us find the right mentor for your business. 1

Name, Industry, & Contact

Founder’s Name(s):

Email Address:

Startup’s Name:

Phone Number:

Startup’s Industry:

2 Elevator Pitch 50 - 100 words (i.e. value prop, problem and market, competitors and market size, solution, etc.).

3 Strategic Area Select one strategic area currently requiring business advice.

Business Development

Marketing Operations Product Development Sales Team Other:

Customer Development Finance Fundraising Legal

Sections 4 - 7 refer to the strategic area you chose. 4 Past Objectives

Objectives

List 3 - 5 objectives accomplished in that strategic area.

5 Past Strategies

Strategies for Objectives

What strategies did you pursue to achieve those objectives?

6 Results

Metrics for Objectives

Provide relevant metrics for the past objectives.

7 Future Objectives What does your startup need to accomplish in the strategic area you chose?

8 Questions 2 - 3 questions for the mentor.

118

Future Objectives

The current version of the RFM is two steps. The first step is multiple choice and the second is the objective for the meeting.

Step 1

An entrepreneur, based upon their stage, submits a request for mentoring by selecting three strategic areas.

Business Development

Marketing

Customer Development

Operations

Finance

Product Development

Fundraising

Sales

Legal

Team

Once the entrepreneur selects three areas, he or she will provide one objective for each of those selected areas.

Step 2

Objectives for the Meeting

1 2 3 119

Pre-Meeting: Mentor Intake Just as it is important to filter and vet entrepreneurs to see if they are ready to receieve mentoring, there needs to be some way to vet mentors. In the development of the mentor system, this portion was the most tricky and had the least amount of consensus amongst the mentors. For example, one of the mentors argued for a self reporting mechanism, which is portrayed in the following few steps. Another mentor argued for a scenario based questionnaire that could quantify the expertise of the mentor. Obviously, both ways are intended to make sure the mentors that are part of the mentor system will ask the right questions, provide the right examples, build future strategies, and enable entrepreneurial learning. The only way to know which way to go for certain is to build and test both mechanisms, see how mentors respond, and iterate appropriately. When mentors from the different local mentoring organizations sign-up for this service, they choose based upon a sliding scale, their expertise and interests. Some of these areas include business development, customer development, finance, fundraising, legal, marketing, operations, product development, sales, and team. The part that has not yet been determined are sub-categories for each area of expertise. For example, within product development some areas of expertise include product or service design, manufacturing, and software development. This list of subcategories can continue grow for each area of expertise.

120

Chapter Three: Designed Solutions

Each mentor signs up with certain areas of expertise and areas they personally find interesting.

Business Development 4

Customer Development 5

Finance

Fundraising

Legal 3

Marketing 4

Operations Product Development

4 1

Step 1

Sales Team

Each mentor then chooses their industry, provides their available times, and how long they would like to meet.

Step 2

Industry Schedule Duration 121

Step 3

Each mentor also lets the system know their preferences for meeting with idea stage, launch stage, or operating businesses.

Idea Stage

Launch Stage

Operating Business

Pre-Meeting: Digital Matchmaking

Step 1

The Request for Mentoring (RFM) is processed and sent electronically to mentors signed up with the mentoring and advisory network as a Request Review (RR). Request For Mentoring

Processed by the System

RFM The Request Review is a summary of the areas the entrepreneur needs the most help. 122

Request Review

Chapter Three: Designed Solutions

The system takes into consideration the startupâ&#x20AC;&#x2122;s stage, the problem areas, industry, schedule, availability, and for how long the individuals would like to meet.

The system then sends out a request review to the mentors that fulfill the criteria.

Step 2

Step 3

Request Review

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Step 4

The mentors may then agree to meet based upon their availability and interest. Request Review

} System Email

Bob 1 2 Amy 3 Mentor 3 4 Mentor 4

N Y Y N

Share Share Share Share

If the mentor agrees to meet, an email is sent out to both the mentor and entrepreneur, with a date, time, location, agenda, and problem descriptions. If the mentor chooses not to meet, the mentor is asked to recommend another mentor for the entrepreneur to meet. The mentor can see if other mentors have agreed to meet with the entrepreneur. If the mentor knows another mentor that is worthwhile for the entrepreneur to meet, the mentor can share the Request Review with another mentor.

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Chapter Three: Designed Solutions

Meeting

After the mentor and entrepreneur have corresponded over email, they meet for a mentoring session.

Follow-up The final piece to the system is the follow-up. This is the feedback mechanism built into the system that will allow the system to change based upon user input. The data gathered via the followup is intended to do two major things. First, to verify whether the entrepreneur attained an outcome, did not waste the mentors time, and is perceived as teachable. Second, it verifies whether the mentor was able to add value to the entrepreneurs business by enabling entrepreneurial learning through asking questions and discussing future strategies. The follow-up data can also be used to update the profiles belonging to each mentor and entrepreneur. It permits a history to be built up and to track the progress of each entrepreneur over time as they start and develop their business. Finally, the follow-up data is intended to be used to inform local mentoring organizations regarding the businesses that are under their umbrellas and how many meetings each business had with their business mentors. 125

The following questions are examples of some of the data that will be useful to track. Youâ&#x20AC;&#x2122;ll notice a (1-5) after each question, which is intended to represent a sliding scale from one to five.

1. Was the entrepreneur prepared? (1-5) 2. Did they ask specific questions, so they can gather data immediately? (1-5) 3. How receptive were they to new ideas? (1-5) 4. How inquisitive/dismissive were they? (1-5) 5. Do you think they should follow-up with you or someone else? If someone else, what other category of expertise?

1. List five accomplishments from this past month. 2. List five steps youâ&#x20AC;&#x2122;re going to be taking this month. 3. Was the conversation with the mentor/advisor useful? (1-5) 4. Would you meet again with this mentor/advisor? (1-5) 5. Would you recommend others to meet with this mentor/ advisor? (1-5)

The data is then sent back to the system and also sent to the local mentoring organization the mentor is associated with.

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Chapter Three: Designed Solutions

The mentoring progress report is one way for the mentoring system to conduct follow-ups with each entrepreneur. If it is a paper system, it could possibly look like the form below. If itâ&#x20AC;&#x2122;s digital, it could be sent over email as a survey. Each progress report would be filled out at least once a month or before an entrepreneur requests for mentoring again. The first iteration of the progress report is below.

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Recommendations for Building and Testing Now that the mentor system has gone through several iterations, it has a reached a point where the entire system needs to be built. As long as the quantitiy of entrepreneur and mentors do not exceed the available man power, it is very easy to use paper forms for an initial prototype. Specifically, there will be a certain amount of hours needed to communicate to each entrepreneur a set of questions and to then coordinate a meeting with an early stage strategist or a mentor. The same goes for the mentors, there will be a certain amount of hours needed to communicate to each mentor and to build their profiles via paper. It is not yet determined the amount of hours needed to gather the necessary information from a large enough candidate pool of mentors and entrepreneurs. Next, filtering, sorting, and matching will require additional man hours. Finally, sending out the necessary parcels of communication and making phone calls and sending emails to each mentor and entrepreneur with considerations of their schedules will take additional hours. Paper and available hours quickly reaches its limits as soon as the number of mentors and entrepreneurs reaches a certain number, which is not yet known. Once that threshold is reached, it is a more efficient use of available hours to develop an internet based solution to automate key information gathering and communication processes.

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Action Plan The current action plan to develop this system is to work with the Empowerment Group, GoodCompany Group, and the Corzo Center for the Creative Economy to build and implement an initial prototype. To fund this prototype, I am currently in the application process for the Creative Incubator Grant sponsored by the Corzo Center for the Creative Economy. This money will go towards paying for the software development necessary to have a large enough pool of mentors and entrepreneurs to filter, sort, and match. A second iteration of the prototype will then build in a tracking system. Two of the design elements that need to be completed before a web system is built include an architect of user flow through the web service, wireframes, and eventually mockups of each point of interaction.

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Chapter Four: Conclusion Chapter four briefly discusses the limitations of this research and areas that require further development.

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Limitations and Further Development There are two areas that require further development. The first area is field research and the second area is the design of the mentor system. The field research on mentoring conversations, the audio recordings and their corresponding visual analysis, requires a greater pool of data. The reason for a larger sample size is to gain statistical significance regarding the mentoring pattern that was discovered. A greater sample size will permit us to overcome individual idiosyncrasies present within each mentoring conversation. Insights may be gleaned from mapping a large sample size with respect to the entrepreneurâ&#x20AC;&#x2122;s stage: idea stage, launch stage, or operating business stage. It may also be helpful to see how these conversations map out with respect to gender and age. The purpose of looking for overarching patterns is two fold. The first purpose is to better inform mentors about how to structure mentoring sessions for the benefit of the entrepreneur. The second purpose is to help entrepreneurs make the most of their time constrained meeting with the mentor. The field research for this thesis only considered short-term relationships between mentors and entrepreneurs, conducting this research should provide insight to mentors and entrepreneurs regarding the evolution of a mentoring relationship and educate potential mentors on long-term mentoring techniques. Observable patterns of long-term relationships may then be leveraged for designs that can encourage these types of relationships. Some of the difficulties of conducting this field research is scheduling and timing each mentoring session. Occasionally,

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entrepreneurs may not show or mentors reschedule. Within the time limited allotted for this thesis, I was not able to complete a statistically thorough study of mentoring conversations. In spite of these constraints, the data gathered highlighted two points of interest. First, it is clear that there are distinct phases within the conversation, which can be seen in the chart titled â&#x20AC;&#x153;Conversational Pattern,â&#x20AC;? page 97. Another finding of merit from the collected data is the eight conversational themes, page 85. Conducting a study on long-term mentoring relationships may reveal more conversational themes. The second area that requires further development is each component of the mentor system. These smaller elements include the entrepreneur intake, the mentor intake, and the follow-up form. The entrepreneur intake requires a set of questions that will help the entrepreneur realize two items: first, where they need to focus, and second, how to identify what mentor they need to meet with. The successful development of the mentor intake hinges on a scalable vetting system for mentors. Currently, there is no clear road to designing an automated and scalable set of question to check the quality of each mentor. Once a larger sample size of mentoring conversations has been collected, the follow-up forms need to be revised to assure the right follow-up questions are being asked. These questions should determine whether the entrepreneur is receiving value from the mentor and whether the mentor is good at asking questions, listening, teaching, and giving examples from their own life.

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Appendix A: Iterations of the Mentor System

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Iteration 1 A piece of feedback I received from my thesis committee was that I was too focused on just the conversation between the mentor and entrepreneur. They asked me to take a bigger perspective and to structure a system around the request for mentoring form, and how the different pieces of the puzzle would then fit together. To answer this question from my thesis committee, I had to go back to my notes I took while meeting with Garrett Melby from GoodCompany Group. While Garrett and I were discussing applications of my thesis research, he sketched out a rough

Entrepreneurs

Match Making

Initial Filter

Good Company Group Corzo Center Empowerment Group

1. GCV 2. Residence 3. Outside a. business readiness... b. coachability?

Mentoring Session

RFM

Mentors Mentoring Heirarchy

1. Business Development 2. Customer Development 3. Finance 4. Fundraising 5. Legal 6. Marketing 7. Operations 8. Product Development 9. Sales 10. Team ...

Ration 1. Frequency 2. Feedback 3. Price

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framework of a mentoring network. He pointed out four major segments to this mentoring network. The first segment includes all possible entrepreneurs that are interested in mentoring, which means that the first segment also has to create a filter that weeds out entrepreneurs that aren't committed to their business and moving it forward. The second segment is the group of entrepreneurs that have passed the initial business readiness filter. This group of entrepreneurs may then submit requests for mentoring when they want to have a mentoring session. However, a key factor that Garrett pointed out is that mentors are a valuable resource, their time is valuable so it shouldn't be wasted. To ration mentoring to the group of entrepreneurs in segment two, we can look at three possible areas to design a mechanism that prevents over-usage of the mentors. The first area is frequency and is determined by the amount of times an entrepreneur meets with mentors. The second area is feedback from the mentor to the mentoring network, letting the mentoring network know that the entrepreneur did not value his or her time. The third area is price, which basically means the entrepreneur would have to pay a small sum in order to meet. For example, this could be from purchasing the mentors coffee, to paying ten to twenty dollars. The purpose for price is to create a sense of value of the time the mentor spends with the entrepreneur. The third segment includes the organizations within Philadelphia, or any other startup ecosystem, that acts as an interface between the mentors and the entrepreneurs. Essentially, the matchmaking group receives the request for mentoring form from the entrepreneurs in segment two, and then sends it off to the group of

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mentors in segment four. The organizations in segment three can also provide a space for the mentor and the entrepreneur to meet and discuss the entrepreneur's business. The fourth segment includes mentors from various areas including business development, customer development, finance, fundraising, legal, marketing, operations, product development, sales, and team. Furthermore, there would have to be a hierarchy in place that would allow for a time manager to know the schedules of all the mentors from each mentoring area. The time manager would then distribute out the request for mentoring form to the mentor that has time to meet.

Iteration 2 For the second iteration, I met with Aaron Mclean, a startup mentor and an experienced entrepreneur. I presented the first iteration of the mentoring system to him and he provided feedback and filled in missing information about how the match making system could actually work. I took my notes from the meeting and created a second visual showing the complexity of the mentoring system. At this point I realized the Request for Mentoring form is a small piece of the puzzle. My discussion with Aaron went over what the business readiness intake would look like and how to measure a mentoring conversation. I learned that the business readiness intake is dependent on the entrepreneur's level of commitment and passion for the business, but will also be greatly influenced by their stage in life. The entrepreneurs life stage is determined by whether they're

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in college, graduated, married, single, has siblings nearby, etc. All these social pieces of information reveals the entrepreneurs competing commitments, responsibilities, available social capital, and safety nets. He argued that measuring the effectiveness of a mentoring conversation is based on asking questions during the mentoring conversation to make sure the mentee is following. From observing mentoring conversations, this seems to be true.

1 Entrepreneurs

2 Business Ready

Original Candidate Group

An entrepreneur submits a request for mentoring and selects three mentoring areas

Match Making System The RFM is processed and sent electronically to mentors signed up with the mentoring network as a Request Review (RR). Processed by the System

RFM

Business Readiness Intake

1 5 8

Electronically, the Request Review is sent out to the mentors that match up with at least two strategic areas.

Follow-up

Mentors

If the mentor agrees to meet, an email is sent out to both the mentor and entrepreneur.

Each Mentor signs up with Certain Areas of Expertise

Mentoring Legend 1

Business Development

Customer Development

Finance

Fundraising

Legal

Marketing

Operations

Product Development

Sales

10 Team

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Request Review

RFM

Mentoring Session

After the mentor and entrepreneur have corresponded over email, they meet for a mentoring session.

Good Company Group Corzo Center Empowerment Group Philly Startup Leaders Cofounders Bridge

The mentors may then agree to meet based upon their availability and interest. Quick Glance View

5 8

System

1 Bob 2 Amy 3 Mentor 3 4 Mentor 4

The mentor can see if other mentors have agreed to meet with the entrepreneur.

N Y Y N

Share Share Share Share

System

1 Bob 2 Amy 3 Mentor 3 4 Mentor 4

N Y Y N

Share Share Share Share

If the mentor knows another mentor that is worthwhile for the entrepreneur to meet, the mentor can share the RR with another mentor.

Iteration 3 The only update from iteration two to iteration three is a better graphical layout.

Mentoring System

Iteration 3, Visualized by Benjamin Farahmand

Entrepreneurs

Organizations

Original Candidate Group

Local Mentoring Organizations

Good Company Group Corzo Center Empowerment Group Philly Startup Leaders Cofounders Bridge

Match Making System Business Readiness Intake

Sign-up for Service

The Request for Mentoring (RFM) is processed and sent electronically to mentors signed up with the mentoring network as a Request Review (RR). Request For Mentoring

Request Review

Processed by the System

RFM 1 5 8

Business Ready

Electronically, the Request Review is sent out to the mentors that match up with at least two strategic areas.

The mentors may then agree to meet based upon their availability and interest. Request Review

An entrepreneur submits a RFM and selects three strategic areas.

RFM 1

8 5

}

Request for Mentoring (RFM)

If the mentor agrees to meet, an email is sent out to both the mentor and entrepreneur.

System

1 Bob 2 Amy 3 Mentor 3 4 Mentor 4

N Y Y N

Mentors Each Mentor signs up with Certain Areas of Expertise

If the mentor chooses not to meet, the mentor is asked to recommend another mentor for the entrepreneur to meet.

Share Share Share Share

The mentor can see if other mentors have agreed to meet with the entrepreneur. If the mentor knows another mentor that is worthwhile for the entrepreneur to meet, the mentor can share the Request Review with another mentor.

Mentoring Session After the mentor and entrepreneur have corresponded over email, they meet for a mentoring session.

Follow-up

Mentoring Legend 1

Business Development

Customer Development

Finance

Fundraising

Legal

Marketing

Operations

Product Development

Sales

10 Team

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Iteration 4 I met with Garrett Melby again to inform iteration four. Some of the crucial pieces of information that I needed to better understand includes the business readiness intake, how mentors would sign-up for the service, how mentors and entrepreneurs would follow-up once they had an advising session, and how best to communicate the entrepreneurs request for mentoring. The diagram on the following page shows iteration four of the mentoring network with feedback incorporated into it. The business readiness intake is a two step process. First, the entrepreneurs from the original candidate group funnel themselves into idea stage, launch stage or operating business. This first part of the business readiness intake also asks for the elevator pitch and contact information. The second part of the filter has two components. The first component takes the idea and launch stage entrepreneurs and has them meet with an early stage strategist. The purpose of meeting with an early stage strategist is to help the idea and launch stage entrepreneur discover their problem areas, understand where to they need to focus, and where they need the most help. The second component takes the operating business and has it self-diagnose where its problem areas. The reason the idea and launch stage entrepreneurs meet with an early stage strategist is because entrepreneurs at this stage, do not yet know how best to focus their efforts or even the order of actionable steps to start a business. When mentors from the different local mentoring organizations sign-up for this service, they choose based upon a sliding scale, their expertise and interests. Some of these areas include business

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development, customer development, finance, fundraising, legal, marketing, operations, product development, sales, and team. The mentor also chooses the industries they’ve worked in, provides their schedule, and how long they would like to have a mentoring session. Finally, the mentor chooses whether they would like to meet early stage, launch stage, and/or operating businesses. Communicating to the various mentors on the network about the entrepreneur’s problem areas is a delicate matter. To prevent mentors and advisers from fishing and to make sure that the entrepreneur feels safe about communicating the problems they’re experiencing, the request for mentoring becomes a request review. The request review is less detailed and only presents the different areas the entrepreneur needs help without describing the problem the entrepreneur is experiencing. The request review is then sent out to mentors that match based upon industry, schedule, meeting duration, expertise, idea stage, launch stage, or operating business. Once a mentor agrees to meet, the mentor receives an email with a greater description of the problems the entrepreneur is having. Another detail is that a mentor can see whether another mentor has already agreed to meet, so they don’t double book a session with the entrepreneur. This will prevent a waste of resources. After the mentoring session comes follow-up. At this time, we ask the entrepreneur to give feedback on whether they found the conversation useful based upon the ideas discussed with the entrepreneur. For example, we would the entrepreneur whether they conversation moved him or her to action, or whether the ideas seem like good ideas when they acted on them. Furthermore, it seems vital that feedback is incorporated from both the entrepreneur and mentor about each other, but figuring out

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whether these will be positive or negative screens has not yet been determined.

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Appendix B: Iterations of the Request for Mentoring Form

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Iteration 1 The first iteration of the request for mentoring simply took the mentor conversation pattern that was discovered and turned it into a form.

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Iteration 2 The second iteration of the RFM builds on top of the first version, and takes into consideration information hierarchy by graphically guiding the entrepreneur's eye from title to question to answer. You'll notice an addition of an icon that visually represents the interaction between mentor and entrepreneur. There is less wasted space and slightly more scaffolding guiding user input when compared to the first iteration.

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Iteration 3 The third iteration of the RFM builds on top of the second version by using the same graphical language and information hierarchy. The greatest change you'll notice is providing greater scaffolding for the entrepreneur's input - specifically, it's the addition of the ten strategic areas that mentors can provide business advice. These ten areas were determined from a survey of ten startups, which involved asking these startups how they describe their own problem areas. Doing this survey and meeting with Garrett informed the changes to language being used. You'll also see the addition of the value proposition because of the need for the mentor to understand the startup's problem and opportunity as succinctly as possible. The user's input is further constrained in order to streamline the entrepreneur's input and the reading of the RFM by the mentor. Finally, two managerial changes include the addition of "email address" and 'phone number."

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Iteration 4 Having emailed out the third iteration of the RFM, I received feedback from Todd, founder of Side Arts and program and marketing director for the Corzo Center. He noticed there are two ways the RFM could be interpreted, influencing how it's used. The first interpretation is a filtering tool for the mentor, to evaluate whether she would want to meet with the entrepreneur. The second interpretation is as a tool for following up. I think both interpretations are valid because they are both part of the interactions between mentor and entrepreneur. I think the first interpretation is the one that should be focused on because this thesis is about how mentors and entrepreneurs identify each other. Furthermore, I met with Sean Steinmarc from psGive and he filled out the third iteration of the RFM. I took the completed RFM to Aaron Mclean, a mentor who has open office hours, to see if he can actually provide business advice and pose relevant questions based upon the information that was on the form. I learned from meeting with him that the RFM doesnâ&#x20AC;&#x2122;t provide enough context to the information the entrepreneur provides. The context that needs to be added is similar to an elevator pitch, where the entrepreneur describes the market and problem, the competitors and market size, the solution their making, etc. On the following page, you will see the fourth iteration of the RFM, it incorporates the elevator pitch section.

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Iteration 5 After testing iteration four of the RFM form with a few entrepreneurs and also getting more feedback from mentors, there are three changes made since the last version. The first change is removing the value proposition section and replacing it completely with the elevator pitch section. A few of the entrepreneurs that filled out the previous version wrote the same first sentence for their elevator pitch and value proposition. The value proposition is redundant and has now been removed. The second change is adding a clear distinction that sections 4 - 7 refer to the strategic area that the entrepreneur has chosen. Entrepreneurs that had filled out the previous version were not correctly attributing the past objectives, past strategies, results, and future objectives with the strategic area they had chosen. Adding a clear distinction now clears up that confusion. The third change is the addition of section eight: questions. In discussion with a mentor from Cofounders Bridge, he pointed out that it's valuable to know what an entrepreneur is expecting from a mentor. In order to communicate the entrepreneurâ&#x20AC;&#x2122;s expectation and outcome, it has been framed as a series of two to three questions the entrepreneur needs to ask the mentor.

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Appendix C: Other Areas of Study

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Appendix C briefly presents some paths I chose not to go down because there was not a clear argument for improving entrepreneurial learning. Instead, these other areas might reveal promising research and designs regarding work spaces, group dynamics, entrepreneurial events, and the difference between the mentoring venture capitalists provide and the mentoring experienced entreprenuers provide.

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Other Areas of Study VC Influence on Entrepreneurial Learning During my research, I had come across two contradictory pieces of information about the roles of the venture capitalists (VC) in supporting entrepreneurial learning. One piece is the information from the Startup Genome, “Investors who provide hands-on help have little to no effect on the company’s operational performance. But the right mentors significantly influence a company’s performance and ability to raise money. (However, this does not mean that investors don’t have a significant effect on valuations and M&A)” The other piece of information comes from Berglund, Hellstrom, and Sjolander. In their paper, they develop “a model of entrepreneurial learning in order to explain how VCs support the process of entrepreneurial learning and thereby add value to their ventures.” Currently, amongst scholars there is a disagreement whether VCs hinder or enable entrepreneurial learning, and as a result, effect the performance of the entrepreneur’s business. There is also disagreement amongst my interviewees. Some of the novice entrepreneurs I interviewed believed that venture capitalists are mentors. However, the experienced entrepreneurs seem to think otherwise. One particular mentoring session I observed between a novice and experienced entrepreneur revealed a difference in perspective. Specifically, the novice entrepreneur was more trusting of VCs while the experienced entrepreneur was not. I think these tensions in perspective regarding VCs and the effects they have on the entrepreneur’s business may prove to be a fruitful area of research.

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Other Areas of Study Team Composition and Group Dynamics Within the IT industry, the stereotypical startup team composition is a “hacker” and a “hustler” (Startup Genome). Essentially, these words imply the two types of roles usually played: building the product and selling the product. Sometimes this can be a single person wearing both hats, other times responsibility is split between two people or even a team of four to five individuals (Startup Genome). Even though I did not delve too far into it, the background in group psychology the Master of Industrial Design program provides prevents me from ignoring the dynamics of how individuals interact with each other while completing a task. I think this area may also prove to be fruitful for anyone that is interested in researching the effects of group dynamics and team composition on the performance of the startup.

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Other Areas of Study The Workspace of the Startup While performing ethnography during my research phase, I came across a few areas that could prove to be fruitful areas of study for anyone else that is interested. One of these areas is startup workspace. Observing these startups, I hoped to uncover the effects of space on the work that needs to be done and challenges that may be uncovered as a result of it. One notable advantage I had observed of startups working in the same space, like that of an incubator or coworking space, is the cross polination of ideas and skills. I learned an office space is not high on the priority list - considering one startup I observed had weekly morning meetings at a food court. That being said, the space they need may be digital or physical, and it seems that the important things they need are efficient means of communication. If they can not all be in the same space to work, they need effective digital tools for collaboration. Skype has its limitations and sometimes the bandwidth may fail, which I have observed on numerous occasions. However, the technology is seen as â&#x20AC;&#x153;good enoughâ&#x20AC;? and the essentials are communicated. One form of communication is task management, and I observed Fit of Passion using Asana. This particular management software worked for them to manage and seperate tasks that needed to be completed. If anyone is interested, the area of study is looking into different workspaces, digital and physical, and correlating its effects on communication between its members.

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During the time I spent with them, Ev (left) and Aaron (right), they met every week on Monday and Tuesday evenings after they came home from their jobs. They spent many evenings in either Ev or Aaronâ&#x20AC;&#x2122;s apartment working on their startup Fit of Passion. As they continued to work week after week on their kitchen table, they invested in an extra table they pulled out for work nights when the rest of the team was around. Working out of their apartment was an effort to keep costs low.

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Observing the whole team together in a relaxed lounge space. A noticeable difference in the work was a communal point of focus, the projector and the content it displayed. The task being done was to brainstorm potential features for their product.

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The classroom with ample white board and desk space enabled the team to work collaboratively and efficiently.

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A university incubator provides startups with a free space and resources. The university permitted multiple startups to inhabit the same facility. It enabled cross pollination of problem solving tactics and the discussion of new entrepreneurial ideas. It gave them access to conference rooms, internet, and entrepreneurial mentors available at their university. 160

At a coworking space for startups, similar to the university incubator, I again noticed cross pollination and the sharing of ideas and tactics - however, in this instance, the space costs a small sum of money. The benefits included the wealth of connections and opportunities via the owners of the space and other coworking startups.

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Other Areas of Study Entrepreneurial Events Another area that deserves research are entrepreneurial events. Specifically, the area of study would be to look at how these entrepreneurial events encourages negative and positive entrepreneurial behaviors when it comes to starting a business. For example, during the Philly Startup Weekend in October, I had observed that the majority of the teams spent most, if not all, of the weekend building a web or mobile application without discovering if their target audience will actually use their service. They were building without learning about their potential customers. I had also sat down and asked two other human centered designers that partook in the Startup Weekend to share with me their experiences. One of these two human centered designers left his first team because the entrepreneurs and developers were only focused on building a product without understanding why they should be building their product and how the needs of their target audience influences the design of their product.

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Entrepreneurial Events: Startup Weekend 2.0 At the end of startup weekend, the team that garnered first place had already acquired two customers. I think they achieved first place because they discovered a solution to a problem that people are willing to pay for. What I saw here, and which I didn’t completely understand at the time, was the importance of “traction.”

Entrepreneurial Events: Startup Weekend 3.0 One of the shirts worn by attendees of Startup Weekend in April, the third Startup Weekend in Philadelphia. It is inspired by the lean startup and customer development model of understanding ones customers by leaving the building to talk, receive feedback, and validate the product or service with real data. There seems to have been a change in behavior as a result of the way the judges ruled during Startup Weekend 2.0, which became noticible in the attitudes of several participants and reflected in their attire. Furthermore, the recent occurance of The Lean Startup Machine, an event similar to Startup Weekend, seems to have also sparked some of this behavioral change.

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Appendix D: Glossary An accelerator is an organization that offers a short-term curriculum to a small group of startups to help them with their business, usually providing the same services as an incubator for that short-term. Entrepreneur is the role a person fills to create and manage a business to generate value for a customer. Entrepreneurial learning is the learning process associated with knowing what to do while being an entrepreneur. An experienced entrepreneur is an entrepreneur that has gone through the startup process from start to finish at least once. Funding refers to external capital that is raised to help the startup cover expenses. Generalist mentor is a mentor that is able to provide strategic advice on more than one strategic area. An incubator is an organization that offers workspace, mentors, and connections to the startups in residence usually over a longterm period. Mentors are experienced entrepreneurs â&#x20AC;&#x153;who actively contribute time, energy, and wisdom to startupsâ&#x20AC;? (Feld).

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new ROI is a return on involvement. A novice entrepreneur is an entrepreneur on their first startup. ROI is a return on investment. Specialist mentor is a mentor that is able to provide strategic advice on a single strategic area. A Startup is a human institution that evolves under conditions of extreme uncertainty along ten interdependent dimensions (business development, customer development, finance, fundraising, legal, marketing, operations, product development, sales, and team) to create a new product or service for a specific customer/user group. Strategic areas are areas of expertise that mentors can give feedback and provide strategic advice. Examples of these areas include: business development, customer development, finance, fundraising, legal, marketing, operations, product development, sales, and team. Traction is an umbrella term used to describe the business moving forward, either by attracting attention in the media, acquiring new customers, raising funds, or even bringing a mentor on board.

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Appendix E: Bibliography

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1. Berglund, Henrik, Tomas Hellstrom, and Soren Sjolander. “Entrepreneurial Learning and the Role of Venture Capitalists.” Venture Capital (July 2007): Vol. 9, No. 3, 165 - 181. 2. Blank, Steve. The Four Steps to the Epiphany: Successful Strategies for Products that Win. City: K&S Ranch Press, 2005. 3. Cull, John. “Mentoring Young Entrepreneurs: What Leads to Success?” International Journal of Evidence Based Coaching and Mentoring (Autumn 2006) .Vol. 4, No.2. 8-18. http://business.brookes.ac.uk/commercial/work/iccld/ijebcm/documents/ vol04issue2-paper-01.pdf. 4. Erdelyi, Peter. “The Matter of Entrepreneurial Learning: A Literature Review.” North Eastern University. December 2011. London School of Economics and Political Science and Bournemouth University. http://damore-mckim.northeastern.edu/ uploadedFiles/Site_Sections/OLKC_2010/Program_Overview/ Parallel_Sessions/241_Erd%C3%A9lyi_Final%20Paper_313_ The%20Matter%20of%20Entrepreneurial%20Learning.pdf. 5. Feld, Brad. Startup Communities: Building an Entrepreneurial Ecosystem in Your City. New Jersey: John Wiley & Sons, Inc. 2012. 6. Gartner, William. Who is an Entrepreneur? Is The Wrong Question. Baltimore: University of Baltimore Education Foundation. 1988. 7. Hwang, Victor and Greg Horowitt. The Rainforest: The Secret to Building the Next Silicon Valley. Los Atlos Hills: Regenwald. 2012.

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8. Kane, Tim. “The Importance of Startups in Job Creation and Job Destruction.” The Kauffman Foundation. February 2012. http://www.kauffman.org/research-and-policy/the-importanceof-startups-in-job-creation-and-job-desctruction.aspx. 9. “Labor Force Statistics from the Current Population Survey” United States Separtment of Labor. Last Modified Date: 5 April 2013. February 2012. it http://www.bls.gov/web/empsit/cpsee_e08.htm. 10. Marlar, Jenny. “Seven in 10 College Grads Are Employed Full Time for Employer.” Gallup Poll. 10 October 2011. February 2012. http://www.gallup.com/poll/149981/seven-college-gradsemployed-full-time-employer.aspx. 11. Marmer, Max, Bjoern Lasse Herrmann, Ron Berman, and Ertan Dogrultan. “Startup Genome Report Extra on Premature Scaling.” Mail Chip. 29 August 29 2011. The Start Up Genome. December 2011. http://gallery.mailchimp. com/8c534f3b5ad611c0ff8aeccd5/files/Startup_Genome_Report_Extra_Premature_Scaling_1.56.pdf. 12. “Philadelphia: Economy.” City-Data.com. January 2012. http:// www.city-data.com/us-cities/The-Northeast/Philadelphia-Economy.html. 13. Rae, David. “Entrepreneurial learning: a narrative-based conceptual model.” Journal of Small Business and Enterprise Development (2005). Vol. 12 No. 3, 323 - 335. http://eprints. lincoln.ac.uk/870/1/uoa36dr06.pdf 14. Ries, Eric. The Lean Startup. New York: Crown Business, 2011. 15. Sarasvathy, Saras. “ An interview with Saras Sarasvathy.” Big Think. 19 May 2009. February 2012. http://bigthink.com/ ideas/15302. 170

16. “Startup Customer Relationship Type Index” Startup Compass. January 2012. http://blog.startupcompass.co/pages/startuppersonality-type-index-page. 17. “Startup Type 1 - The Automator” Startup Compass. January 2012. http://blog.startupcompass.co/pages/startup-personality-type-1 18. “Startup Type 2 - The Integrator” Startup Compass. January 2012. http://blog.startupcompass.co/pages/startup-personality-type-2-transactional-sale 19. “Startup Type 3 - The Challenger” Startup Compass. January 2012. http://blog.startupcompass.co/pages/startup-personality-type-3-enterprise-sales. 20. St-Jean, Etienne. “Mentoring Functions for Novice Entrepreneurs” 21. St-Jean, Etienne. “The Influence of Mentoring on Mentee’s Satisfaction and Career: The Role of Entrepreneurial Self-Efficacy.” Université du Québec à Trois-Rivières. February 2012. http:// sbaer.uca.edu/research/USASBE/2011/PaperID82.pdf. 22. “The Rise of Startup Ecosystems: Silicon Valley vs. New York vs. London.” Startup Compass. 2012. May 2012. http://blog. startupcompass.co/the-rise-of-startup-ecosystems-siliconvalley. 23. Weitekamp, Rossana . “Job Growth in U.S. Driven Entirely by Startups, According to Kauffman Foundation Study.” The Kauffman Foundation. 7 July 2010. January 2012. http://www. kauffman.org/newsroom/u-s-job-growth-driven-entirely-bystartups.aspx.

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Postscript After presenting the mentor system during my thesis defense, I received feedback on two major areas of the system that will help guide its development. The first area is learning for the entrepreneur and the second area is determining the outcome of the mentor system. One of the challenges of the mentor system is measuring the actual learning that is going on within the mentoring session. For the entrepreneur, the learning occurring during these mentoring sessions is dependent on their stage â&#x20AC;&#x201C; idea stage, launch stage, or operating business stage. As part of the design for the mentor system, the system needs a set of metrics for measuring the appropriate skills for each of these stages. Measuring these basic competencies for each stage, while the entrepreneur has progressed from the idea stage to launch stage and finally to an operating business, will determine whether the learning will actually result in an increased business success. In other words, the entrepreneur will be making less mistakes. As a part of learning from a mentor and having discussions and feedback, the entrepreneur should make less mistakes over time. Being able to know when an entrepreneur changes their mind from going down one road to another can be one indicator of learning. Another indicator is measuring for the conversational themes mentioned on page XX. If these conversational themes were present within the mentoring conversation, then the precursor for learning is present. However, without measuring entrepreneurial behavior we can not be certain if learning took place. For example, if we look at a classroom full of math students, we can measure 172

how they are learning by testing them against a set of standards. We begin with an entry exam, to see how much they know on the subject. The lesson is taught and a second exam is administered on the same subject. If fewer mistakes were made, itâ&#x20AC;&#x2122;s assumed that learning has occurred during the lesson. I think this same example can be applied to entrepreneurship in the sense that learning is measured over time, not with a single set of questions. A reduction in mistakes can not be measured by a single exam. Obviously, asking entrepreneurs to take a single survey as they are starting their businesses is not the right way to go about measuring learning. Finding the appropriate mechanism for this will take some time and will guide the development of this project over the next few months. I think this feedback will effect the follow-up section of the mentor system by determining the questions that need to be asked. The second area of thesis committee feedback is determining the outcome of the mentor system. This means that I need to explicitly communicate the value this system delivers to its different audiences â&#x20AC;&#x201C; entrepreneurs, mentors, and local mentoring organizations. This ties directly with the value proposition because it will determine the expectations of each audience before they use the mentor system. At the moment, it seems the best course of action is to go directly to the users in order to determine what the mentor system should accomplish. If we look at entrepreneurs, we realize they want a successful business. Non-profit local mentoring organizations want to help more entrepreneurs because they receive federal funding that requires them to help as many entrepreneurs that seek them out. Mentors want to be able to give back and see an eventual impact as a result of their mentoring. The needs and wants of these three different intersect at helping entrepreneurs start and continue to operate sustainable businesses. At this intersect, I believe we can define the outcome for the mentor system. 173

About the Author

Benjamin Farahmand If you’re reading this, it means I have garnered a Master of Industrial Design. If you’re not reading this... well... I’m interested in leveraging the human centered design process and information technology to solve social and systemic problems with scalable impact. In my spare time I make digital interactive art, write essays, play the drums and piano, and go out dancing. :) I also hold a B.S. in Aerospace Engineering and a B.A. in Philosophy from UCLA. e: benfarahmand@gmail.com t: @benfarahmand w: www.benfarahmand.com 174

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