I have been mentoring start-ups and high-growth companies for more than five years, and I have noticed that the terms mentoring, coaching, and consulting are often used interchangeably. For me, these words have very different meanings and implications for the businesses receiving each service.

Mentoring is provided for free by people who have experience that is relevant to companies. It’s a case of passing on your knowledge about business models, and it can be done in an informal way, such as over a coffee. I like to mentor companies around sales, starting up, and finances; they’re areas where I have some experience. When people are being mentored by someone with more experience, their role is to listen.

Coaching, on the other hand, is a two-way process. It may be done for free or for a fee. Because it’s a two-way process, the clients (the “coachees”) explain the specific issues they have and ask the “coach” for advice. Coaches don’t have to possess specific sector or even industry knowledge (this is where I sometimes get into trouble with people who disagree with me).

Coaches are very good at getting the best out of people. While it might seem odd that some of the best sports coaches—for example, José Mourinho and Arsène Wenger—weren’t particularly good players, I would argue that it is because they’re aware of their limitations as players that they excel as coaches. The best coaches bring a fresh perspective and challenge assumptions—something a mentor may not be able to do. The resulting action points are still undertaken by the business alone, not the coach.

Finally, consulting is about asking an external person to dig deeply into a specific issue, then use their expertise to help with that issue. Many mentors may “commercialize” their mentoring by moving the relationship on to a consulting piece of work. While there is nothing wrong with this—I’ve done it myself—the mentor should always act in the best interests of the client.

For example, consultants with excellent financial skills may be asked to prepare financial documents for a start-up looking to raise substantial funds. In a consultancy situation, the consultant should undertake most of the work.

In my next blog I’ll look at what makes a great mentor, and in my final blog on mentoring I’ll explore how to find a great mentor.
 

 

Permjot Valia is an early stage investor and co-founder of Flight & Partners. Follow him on twitter: @permjotvalia, and his blog: www.businessangelblog.com.