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As a pre-seed accelerator, the Founder Institute leans heavily on our entrepreneur and investor mentors to provide critical feedback for our founders. 

However, we also understand that helping early-stage founders can be very challenging. Mentors want to be positive and inspire new founders to build a great company - but is that really the best way to get results?

We have worked with thousands of startups, and we have learned that to truly help an early-stage entrepreneur, you have to be brutally honest.

Unfortunately, most startup mentors are simply too nice and often sugarcoat their feedback, which is a disservice to their mentees.

How to Ensure Honest Feedback

Since you can’t force somebody to be brutally honest, we came up with a paradigm in the Founder Institute to get the best feedback from our startup mentors. Throughout our Core 4-month program, founders are constantly pitching their ideas, customer research, revenue model, growth plans, first products, and more to panels of program directors and startup mentors on what are called “Founder Hotseats.” Right before the mentors are asked to provide detailed feedback to an entrepreneur, they need to rate the company on a scale of 1-5.

There’s just one catch: on a scale of 1-5, no 3's are allowed.

Inspired by our friend George Zachary of Charles River Ventures, who implemented a "no 3's" rule for himself while judging our Founder Showcase events, this scoring system is designed to polarize and extract blunt feedback from mentors.

When you can’t rate somebody a 3 out of 5, you are forced to choose negative or positive… and then ponder why. This ultimately leads to deeper and more honest insights for startups in dire need of exactly that.

You would be surprised at how well this works, because it forces even the nicest of mentors to be blunt and introspective.

A common question we get about this practice is, “why not just do a 1-4 scale?” The answer is simple: this is about polarizing results. If you rated something a 2 out of 4, that could be seen as average - but a 2 out of 5 is clearly poor. We want our mentors to consider the 3, and then judge whether or not the founder’s plans clearly fall on the positive or negative end of the spectrum. The reason for that decision is most often where the most valuable feedback lies.

The Thin Grey Line

Now, this can be a tricky game. Being tough and being mean can be very similar, and mentors should never lose all sense of empathy for early-stage entrepreneurs. But I think Dan Shapiro, a very successful entrepreneur and highly rated Founder Institute mentor, put it best by saying;

Being direct is just a thin grey line away from being an a-hole. But nobody wins if the conversation just goose-steps around.

New entrepreneurs have way too many family members, friends, and colleagues sugarcoating feedback and telling them their idea is great. We want our mentors to tell entrepreneurs why their startup sucks. We want our mentors to tell them why they will fail. The market is black and white, so any advice or feedback we provide to founders needs to be too.

If you really want to have an impact on the startups you are mentoring, you have no choice but to walk that "thin grey line", be tough, and tell them what they need to hear.

We also tell our startups to demand blunt feedback as well, both in and out of the FI program. As one of our highest rated mentors, Rajesh Setty, wrote on his blog:

Every time you ask for feedback of any kind, it is better to remove the “cop out” choice. It really doesn’t help if you get a three as a rating for anything. You don’t know what is being said. You don’t know whether they are happy or sad or they are just trying to be nice and polite. It is better to know the real feedback than to be in the fantasy world that everything is just great.

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