Who Pays for My Business Support and Who Receives It for Free?
After living in southern Africa for two years, my business has grown beyond my expectations. While I recognize my efforts to achieve this success, it prompts me to consider how I position myself: as a commercial entrepreneur, a social entrepreneur, or a mix of both? Specifically, which starting entrepreneurs do I mentor for free, and which ones are invoiced for receiving the same expert guidance?
Doing business in Africa has its own unique dynamics, which I discussed in a previous blog post. In this piece, I'll share how I've applied those insights to my business development support.
I stumbled upon an advertisement for MicroMentor Support (MicroMentor) on Facebook, calling for business professionals to assist emerging entrepreneurs, primarily from developing nations. Touted as the world's most extensive community of entrepreneurs and volunteer business mentors, I wholeheartedly recommend joining their cause.
Without hesitation, I signed up. Within two weeks, my inbox overflowed with support requests. Once I updated my LinkedIn profile, I began receiving a new request daily. All of this transpired even before I launched my personal branding website, which now generates yet another stream of mentorship requests.
Given the volume and variety of these inquiries, I found myself contemplating how to differentiate between non-profit and commercial mentoring. How do I ethically conduct business development, from which I also aim to earn a steady income to support my growing African family?
Examples of Requests Include:
- An emerging non-medical skincare product manufacturer: No business plan or funds.
- A brewer introducing a new beer without a marketing strategy.
- A finance expert with an online platform connecting borrowers and lenders, but without borrowers.
- An NGO-backed visionary with agricultural ventures lacking funds and a business plan.
- An IT entrepreneur with validated solutions, yet insufficient clientele.
- A Chinese crane and heavy machinery producer with no foothold in the African market.
- A fintech start-up desiring rapid scaling but facing organizational and financial hurdles.
- A tech hub without a coherent business model, offering a blend of free and paid services.
Can you distinguish the commercial requests from the non-commercial ones?
On my website, I emphasize that every business should be profitable, ensuring not only a stable income but also contributions to charitable and social initiatives. This could be a benchmark for deciding between free or paid support. If an entrepreneur doesn't express any social responsibility aspirations, perhaps they should be invoiced—could this be considered a penalty for self-centeredness? However, I always emphasize the importance of societal engagement in business plans. If there's resistance (such as concerns about diverting needed funds), I stress that societal involvement isn't optional but rather a marketing necessity.
My core belief is that the revenue generated from successful commercial entrepreneurs covers the costs of supporting those I mentor for free. Here's how I differentiate between the two:
- If you're launching a commercial business, you'll be invoiced—just as tax authorities will tax you once you achieve success.
- Businesses that aren't profitable within a year of our collaboration won't be charged.
- Non-profit ventures with positive revenues won't be billed.
So, What and When Will I Charge?
Amount: I will discuss and agree upon a reasonable fee with the entrepreneur for the support provided. This will be clarified at the outset of our collaboration, and together, we'll define a criterion to be applied at the relevant time.
Timing: I won't request payments at times when doing so would contradict my advice to reinvest all profits. I'll ensure that your company retains the necessary cash flow for development needs.
Payments can come in various forms, much like in most businesses: cash, invoice transfers set for specific dates, profit sharing, co-ownership, or even payment in kind via goods or services.
Feedback is always appreciated. Please reach out at info@hansblom.org.
