Anyone making the leap from employee to entrepreneur is acutely aware of both the struggles and advantages built in to the transition. Yet, regardless of how educated and driven an entrepreneur might be, the learning curve for keeping a small business afloat, not to mention thriving, is at times fairly steep.
That being said, our experience has shown us that most entrepreneurs take these challenges in stride, and choose to search for workable solutions rather than looking for a way out. And it’s exactly this brand of persistence and ambition that makes us believe so strongly in small business owners, who are often among the most hardworking and capable leaders across every profession.
Nonetheless, one area that is sometimes overlooked by entrepreneurs at every level is the peer advisory group. But what are the real benefits of joining a peer group, and is joining these groups worth investing a busy small business owner’s time and energy? The answer is unequivocally yes, and here are some top reasons why.
We had the great pleasure of interviewing Rob Dube, seasoned entrepreneur and owner of Image One, on our radio program The Second Stage, where he discussed with us that a piece of guidance he received from his peer group completely transformed the value of his company.
In fact, during our interview, Mr. Dube shared:
That peer group…got us to a point where we were in a position not only to be attractive to sell to a buyer – we got paid higher multiples than what the industry norm was. I really believe that had everything to do with that peer group.
By design, the goal of a peer group is to help a small business become more financially viable through the power of working collaboratively with entrepreneurs who have already been there and done that. If a company isn’t being as profitable as it should be, or it’s putting money into areas that offer little return, a peer group can assist in recognizing and resolving these issues, and enable the business to grow again.
Peer groups give small business owners opportunities to explore solutions to everyday problems without the emotional connection that typically serves as a roadblock in decision-making. In Entrepreneur we see this stance resonated, as contributing writer and entrepreneur Brian Barquilla points out:
It is likely whatever problems you face, someone in your group has faced it and remedied it but what worked for one industry may not with another.
[Sometimes the] “best” solution may be one that nobody in your group had the courage to deploy. Your group will expect you to think through your best solution. Surrounding yourself with 10-12 smart business owners removed from the emotion of a decision is a powerful thing.
One of the best ways to approach a problem is by examining it from a distance. When a business owner is caught up in marketing their products or services, making financial decisions and serving as the company leader, getting a clear perspective on where the business is really heading can be tricky – particularly when so much of your own blood, sweat and tears is involved.
Peer groups provide the distance every entrepreneur needs. Whether the group is bouncing around new ideas, taking the sting away from poor financial decisions or steering a small business in the right direction, these groups are comprised of professionals whose experience and sober insight is invaluable.
Accountability is a term we use often at Evolution Capital Partners. In fact, accountability serves as the 5th pillar in The Five Pillars of Business Freedom, which asks entrepreneurs to create a culture of accountability in their business to ensure an organization’s growth and success.
When it comes to finding the right peer group, accountability should be an integral part of the group’s central principles. Otherwise, individuals who attend these meetings won’t necessarily feel obligated to the overall mission of the peer group, and will be taken less seriously by other members who have shared their advice on how to fix problems or make improvements.
In another article on Entrepreneur, leadership development advisor Beth Miller had this to say about accountability in entrepreneurial peer groups:
Having one witness to a commitment or goal is helpful. Having 10 witnesses is downright powerful. Nobody wants to be the only one to show up to a peer meeting without a completed goal! Members of the group celebrate each other’s success, creating positive reinforcement and a nurturing team environment.
If someone is struggling to meet a goal, the group can help determine the obstacle and suggest solutions. Through this mixture of peer pressure, praise and group brainstorming, entrepreneurs and business owners experience real and continuous professional growth.
Over the years we have covered this topic extensively because it’s played such an essential role in our own success and in the success of entrepreneurs we have worked with. In one episode of The Second Stage in particular, we spoke with the CEO of Inc. Navigator, Brent Sapp, on the subject. In a follow-up article, my partner, Jeff Kadlic, shared this piece of information about accountability in small businesses that is just as applicable in the peer group itself:
Accountability ensures that there is alignment to reach the goal line with the metrics, plan and team you have put in place. Holding people accountable, including yourself, as the leader of the organization, is truly the key to success.
Without accountability being part of peer group discussion, everyone misses out on getting measureable results from members who have previously been offered guidance. And in order for the peer group to feel successful itself, members need to truly understand if their advice worked, and if so, if any further adjustments are necessary.
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