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Advice More Valuable Than Money

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I have seen entrepreneurs mess up relationships with key people because of ignorance and the need for immediate gratification.

There are three types of relationships you will develop when you take the entrepreneurship journey. The first is personal relationships, mostly with your family and friends. The second is relationships with key people who help you get things done, such as colleagues, business partners and associates.  The third are strategic relationships with people who have experienced the success that you are aiming to achieve. These are the people that usually take the role of mentors and coaches; they will show you the ropes in business.

The third relationship is probably the most interesting and the most important. These are the people who you can have coffee with and bounce  ideas off of. They can give you advice on deals you are involved in, and if you’re lucky they will pick up a phone and call their golfing buddy to assist you. Basically, they will provide a link for you with people that will make your business more successful.

When you meet one of these people, you must be careful not to jeopardize the relationship. One of the biggest mistakes you can make is to ask for money from the offset. This is a subject that should be avoided by all means in the first meeting, unless the meeting was called for the specific purpose of funding.

The truth is the best financiers are often mentors. It is likely they will have known you for some time, and will have observed your progress. If they are impressed by your business, they will want to fund your company.

An open secret is that if a businessman admires your business, and you ask them for advice, you will eventually emerge with funding if that is what you need.

Almost everyone that meets a successful person is looking to get something out of them. You need to take a different approach to the majority of other people they meet. You need to stand out; they are more likely to help you if they can remember you and your ideas. Remember that most successful people are happy to talk freely about their story and give advice to anyone willing to listen.

My call to fellow African entrepreneurs is to build relationships before you try to extract value out of them. It’s would be even better if you are able to first to offer value to the would-be-mentor before you ask them for favours.

This is the secret that has the ability to take businesses to the next level. This is the reason that large corporations hire a professional who is responsible for managing relationships. Some companies even have what is called an entertainment budget, to cater to potential clients and the established clients. This money will look after them and in turn it will look after your income.

Daniel Jacobs, the Co-Founder and CEO of Avanoo, a revolutionary training company, was 21 years old when he moved to San Francisco with no money or connections. He decided to email C-level executives of Fortune 500 companies. Jacobs highlighted specific work he admired and expressed an interest in learning from them.

You might think that the people at these companies are hard to reach. Jacobs received responses, with proposed meeting dates, from many of them. That was the beginning of him forming relationships with leaders from huge corporations, like Coca Cola and Morgan Stanley.

Jacobs went on to start a number of companies and used those relationships to make them a success. At a board meeting of one of his companies, where some of those mentors were board members, the President of NBC said that he responded to Jacob’s cold e-mail approach because, unlike others who usually ask for a job or something else from him, Jacobs only asked for advice. Amazingly, all the other mentors agreed that’s why they helped him as well.

It wasn’t luck either. The Co-Founder and CEO of Instagram, Kevin Systrom, also has the ideology of asking for advice before expecting anything else.

Until an entrepreneur learns this simple networking trick, they will struggle to form meaningful business relationships with those that will benefit them the most.

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