Guiding the entrepreneurial odyssey : the impact of mentors on strategy formation in nascent ventures

Founders of early-stage ventures do not form their strategy in a vacuum. In fact, founders of high-potential startups typically seek strategic advice regularly throughout the strategy formation process. This is particularly true for founders participating in accelerators and other entrepreneurial support organizations, which provide robust access to training and mentorship. Accelerators have proliferated over the past decade and stress the important role that mentors play during these fixed-term programs – yet much of the research on strategy formation in nascent ventures has focused on the role of the founders as internal strategists. This limits our understanding of the impact that key external strategists such as mentors have on venture strategy. In particular, we lack insight into two important questions: 1) How do founders solicit and integrate advice from many external advisors?, and 2) How do mentors attempt to shape strategy formation in the ventures that they advise? Given the lack of research on this topic, I employ an inductive, theory-building methodology to perform a multi-case comparative study of nine ventures participating in a Texas-based accelerator. Using data from 84 interviews conducted with accelerator founders, mentors, and staff as well as over 80 hours of observation, I investigate the interactions between mentors and founders over the course of a three-month accelerator program. I find that founders have advice-seeking heuristics that guide their approach to soliciting strategic advice from mentors. In particular, founders use a broad or narrow approach when engaging mentors, and approach them in either a transactional or relational manner. By considering the intersection of these two dimensions, I identify four distinct strategic advice-seeking approaches, labeled as the crowdsourcing, broker, listening tour, and proto-board approaches. Findings also suggest that how founders seek advice can have an important impact on strategy formation. Finally, this research identifies key practices (labeled co-creating, provocating, delineating, and stage-gating) that mentors use to shape strategy formation. These findings contribute to the literatures on entrepreneurial mentoring, strategic advice, and strategy formation. In addition, this research offers several practical implications to founders who seek strategic advice, mentors who give it, and entrepreneurial support organizations who facilitate these interactions.