I know in one of my earlier entries, I said that failure was an entrepreneur's best friend.  Well, I really should have said failure's a good wing man because an entrepreneur's best friend is networking.  I know, I know, my blog's first contradiction.  Anyway, back to networking.  Networking is probably the most important skill for an entrepreneur to have - it is a way to develop strategic partnerships, prospect for clients, and to find new business opportunities.  No matter how you spin it, business is about relationships.  People like to do business with people that they know, like, and trust (that's a nugget I have to attribute to Sulaiman Rahman who founded Urbanphilly.com).  The better you are at building MEANINGFUL relationships, the higher the likelihood of your success as an entrepreneur.

In my 4 years, I've done a fair amount of networking.  And I have to say, it's tiring for me.  What's most tiring is an endless line of aspiring entrepreneurs that pretend to be something much more than they truly are - in other words, they like to waste people's time by talking big and lacking any substance.  These are the same people that follow the "Myspace" approach to networking:  they figure if they can get as many business cards as possible, they are successfully networking.  Me?  I'd rather have 5 connections that are really STRONG connections.  What's a strong connection?  One that will answer your calls and knows who you are as a person not just what your e-mail and cell phone number are, one that will do what they say they will do, and finally, someone that knows a lot of other strong connections.  I often call them connectors...that's a term from the book The Tipping Point by Malcolm Gladwell.  These are people that have the ability to bring people together for the purposes of accomplishing something bigger than the sum of the two parts.  I want a Rolodex of ALL connectors as they are the gateway to MORE connectors.  "Myspace networkers" are dead ends. 

"Myspace networkers" are dead ends because they approach everyone they meet from the prospective of "how can I benefit from this person"?  What they don't understand is the hierarchical nature of most relationships.  I believe that very few relationships are between "equals".  Most relationships have one dominant and one submissive participant - in other words, one party is control of more power than the other.  If you are a relatively young entrepreneur and you are looking to meet connectors, you most likely are sitting in the submissive chair (sorry)!  That means that you have to approach networking from the perspective of "what value can I provide this connector?".  As the submissive, not only do you have to deliver additional value to the connector, but more importantly, you have to establish a reputation with that connector that you are someone that will DO WHAT YOU SAY YOU WILL DO.  In other words, you have to prove that you are reliable.  This may mean that if a connector invites you to one of their fundraisers, you go even if it means you have to fork out $150 bucks.  Or if there's someone that you know that the connector wants to meet, YOU arrange the meeting.  Little things like that help to build trust and what I like to call "relationship equity".  This type of equity takes a LONG time to build.  You cannot build it overnight. 

I've been building relationship equity with some of my best contacts for 3-4 years.  However, this investment of time and sweat has JUST started to pay off.  Now, many of them are starting to come to me and bring them into their closest circles.  Some of the events I've been invited to recently are like "connector candy stores".  A mistake a lot of people make is that they wait until they need someone before they start to build a relationship.  That's too late.  You could easily be 3-4 years away from benefiting from that relationship. 

I know the types of projects I want to get involved in over the next 5-10 years:  private equity, educational speaking to entrepreneurs, and real estate.  When I meet someone, I don't always know exactly how, but I can usually tell if that person has knowledge that I can truly benefit and learn from.  But even if I see them benefitting me, I spend very little time at the very beginning of the relationship telling that person about what I want because I know I'm the submissive in the relationship (that just sounds dirty).  I ask A LOT of questions about the other person and understand their challenges both on a business level and on a personal level.  Then I look at my Blackberry and my contacts list and see if there's someone I can put this person in touch with that will help them.  You don't want to ask for anything or you'll be spending relationship equity that you haven't built up yet...and we all know about the subprime crisis and how that's going...

This was a long one for me so let me end it here.  But let me end with some final thoughts: plant your seeds now.  Don't wait until you need a contact to try and foster a relationship.  It will be too late.  Building relationship equity takes a lot of time, money, and effort to do it correctly.  Approach it in a genuine way.  And if you have the choice between having a lot of superficial contacts and a few choice meaningful contacts...choose quality over quantity ANY day of the week.