Top 15 mistakes when starting an executive & leadership coaching practice

Article written by Coach Master Toolkit program leader, Andrew Neitlich

A common question I get asked by my Coach Master Toolkit program members is: "What are the top 3 mistakes you see executive coaches making when they first start out?" Reflecting on this, I have came up with a total of 15 mistakes that I believe significantly effect the success of an Executive Coach when they are just starting their practise.

Here they are:

1. Not having enough financial reserves to make a fair go of it. You don't want to come across as desperate to clients. As the late, great sales trainer David Sandler wrote, show clients that you want the work but don't need it. Also, you can't predict whether it will take you a few months, a year, or even two years to achieve your income goals for your practice. If you want to start a coaching practice, get frugal now. Save up as much as you can so that you have 1-2 years of reserves ready to go. Having a good financial runway gives you room to make mistakes, be patient when you face rejection, and experiment to find your best niche and approach to business development.
2. Giving up. Most coaches are not particularly resilient. They give up too soon. Coaching is a business like any other, except that it depends even more on personal relationships and selling. Expect failure and rejection. The opposite of fragility, as Nassim Taleb notes, is anti-fragility -- the ability to be stronger in the face of difficulty. If you want to succeed in your coaching practice, I hope you can develop a mindset of anti-fragility. It took me six months of rejection before I experienced my first success. I have found that few people have the grit to do what it takes to build a practice. I hope that you do.
3. Failure to take action. If you have any spare time when starting a professional practice, you had better be using it to attract clients.
4. Failure to take smart action. I was fortunate to launch my practice before the Internet was much of anything. So I had no choice but to do things the old fashioned way: meeting people, giving educational talks, meeting people, and meeting people. Nowadays, aspiring coaches hide behind lots of things they hope will work, like the perfect website, LinkedIn schemes, blogs, print-on-demand books, and every which way they can come up with to avoid having conversations and building relationships. When they do try to meet people, they often go to low-level networking events that won't do anything for them. This is not to say that online marketing is a waste of time. It is not -- when done properly and in ways that lead to off-line conversations with decision makers and people who can open doors for you. However, if you want to get business, you need to do it in ways that get you in front of true decision makers, by showing that you are credible and in ways that set you up to talk to them about their problems and how you solve them. If you aren't doing this, you don't exist. Most coaches do not exist.
5. Taking on a single client full time. This is a huge mistake. Here, you basically have a job without benefits. Direct client work should not take up more than three or four days of your time. Otherwise, you give up time for business development and developing scale in your firm (e.g., developing intellectual capital).
6. Selling coaching and assessments as features instead of as solutions to problems. When I hear a coach selling assessments as a product, or offering coaching as a package, I know they are not doing well.
7. Using the word "I" too much. Many coaches are narcissistic. Many suffer from messiah syndrome. They want to be gurus. They believe they are important enough to transform other lives. They believe they can create cathartic moments that change lives. It is all about them, their philosophy, and what they can do to others. Successful coaches are more about how they can serve others and solve real-world, practical problems that decision makers face. Therefore, they use the word "you" much more and ask probing questions to learn about real-world, practical problems and how the other person perceives a valuable outcome/solution.
8. Failure to communicate value. You have to learn how to state your value in clear terms.
9. Dabble, dabble, dabble. Focus on a niche or two. I know one coach who switches niches every two weeks and hasn't closed an engagement in two years.
10. Being generic. Have the courage to be memorable. Stand for something specific, memorable, and valuable to a specific market. Think about the celebrities, sports figures, and personalities you know who are memorable -- in a good way -- and why that is. Model yourself after them. It is better to be a little bit polarizing than invisible.
11. Going for the shiny new client instead of focusing on how to serve a few clients for a long time. Current clients will be your best sources of ongoing revenue and referrals every time.
12. Going broke by going after huge clients. You can make much more money, and close deals much more quickly by going after the small to mid-sized companies. Huge clients will bankrupt you fast. Leave that to the massive consulting firms and investment banks.
13. Charging too little and charging by the hour. Clients respect you more if you charge at the higher end, and charge by the engagement (not the hour).
14. Going after a new market, instead of focusing on where you have already been successful in your career. Even if you don't like your current or past industry, don't be fooled. Things aren't much more exciting in other industries or sectors, either. The only difference is that you don't have any contacts there. If you can't be successful in your own backyard, why do you think you can be successful in someone else's?
15. Not getting fired. For those of you in a full-time job, your biggest mistake is having a job. You probably won't get started with that nice salary and benefits package. The best thing that can happen to you is that you get laid off or fired. Then you have no choice. The good news: It will probably be the best thing that ever happened to you -- as long as you listen to the first piece of advice and have plenty of money saved up.

So there you have it! I wish you the best of success no matter which stage you are at in your coaching practise.

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Author: Andrew Neitlich has a Harvard MBA, a full coaching practice, and also runs the Center for Executive Coaching, one of the leading training organizations in the world for executive and business coaches. He has written a number of books about coaching and leadership, including The Way to Coach Executives, Guerrilla Marketing for Coaches, and Elegant Leadership: Simple Strategies, Remarkable Results.

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