An entrepreneur in a startup company meeting with a mentor.
We spend the formative years of our life growing up and getting an education and it seems like our parents and teachers focus on building ‘what we know,’ but they rarely touch on the importance of building ‘who we know.’ Perhaps, there should be classes in high school and college teaching students the advantages of creating a powerful network. At one time or another, we have heard the popular catchphrase, ‘it’s who you know, not what you know.’ Who you know might matter more, or at least be just as important as what you know in getting career or job referrals. Here is why.
For most companies, and especially startups, as they look to hire new employees, they turn to their current employees for employee referrals. According to Zippia, a career research website, current employee referrals account for 30-40% or more of all new hires. Employee referrals improve retention, as employees join a workplace where they’re already familiar with at least one person and have some insights on the company culture. Increased retention isn’t only about candidates; current employees who make successful referrals also tend to stay longer at the same company. So, how do you build a network that will ultimately get you a referral or help recruit employees to your startup?
The first thing you need to do is to shift your mindset to focus on people, not opportunities. People can tell when you’re only approaching them for your own personal gain. You might get the specific thing you wanted, but they will remember your self-centeredness and be less likely to pass future opportunities on to you. The way to do this is consider who to target and what value you might bring them. Can you share research, industry advice or perhaps introduce them to someone that would be beneficial to them or their company? In order to accomplish your plan of building a strong network, you need to identify very specific types of people and then hone in on identifying and selecting those specific people to begin building your network on purpose.
Here is a potential framework of the network you might build on purpose depending on your career or startup ambitions.
Advice from experts in your network.
Mentor with relevant experience. If you want to become a marketing expert or even create a startup company, then choose your potential mentor accordingly. If its marketing, then try and recruit a marketing expert. If you want to build a startup company one day, then recruit an accomplished entrepreneur.
Industry research expert. It’s a real benefit to understand get guidance if you are focused on a particular industry. If you believe you want to work in cloud software or even create a new SaaS company, then target a cloud or SasS industry expert who can keep you informed with research or trend data.
Marketing expert. At some point in your career, if you intend to create a startup company, you need to have someone in your network who is a branding or marketing expert. So many companies have failed not due to the product or service they created but because they did not have the proper branding or marketing campaigns to accelerate them into the marketplace.
Financial expert. Understanding the numbers and ratios that are critical for a company to grow and succeed is extremely important. Having a financial expert in your network will allow you to avoid simple mistakes, perhaps better understand cashflow and maybe even leverage certain partners to lower your financial risk. This person will also have other experts in their network, potentially even investors who can help fund your startup.
Technology expert. Technology plays a strong role in almost any company that exists today and will be mission critical for future companies. Even if the company’s product or service is not technology related, it will need to leverage next generation wireless, cloud, security, operations and employee management technologies to operate the business efficiently.
Specific expert. Based on your career or startup ambitions, you will need to recruit a specific expert to your network with key industry or skill knowledge. For example, lets say you want to build an ecommerce company. Having an ecommerce expert, with several years of experience, in your network will allow you to learn quickly, avoid simple mistakes and leverage the right strategy and tools to grow quickly.
Competitive peers. While most people might not choose to have peers in their network from competitive companies, networking is about building relationships, including people in your business category. Your ‘competitors’ might have the same company problems that you do, and have learned how to deal with those problems, so you can learn from each other. They can also make great business friends, since they understand you better than people who are not in your business.
You have two choices. Just through everyday life and random connections, introductions and meetings, you will build a network. It may be good or it might be weak. Your other choice is to purposely build a network that will potentially fuel your career, your startup, and perhaps even your life.