The Pros and Cons of Masterminds

When you’re building a mentorship or coaching program, you have several ways to structure your delivery.

1:1 – direct mentorship or coaching. You respond to an individual’s needs specifically, help them build a plan, and encourage them through the action required.

1:many – group coaching. You teach a concept, and connect people in the group to share experiences.

And there are several ‘hybrid’ options, of course. Some mentorship practices use a mentor/coach model. Some use 1:1 mentorship at one phase of their ascension model, and group coaching at another stage.

Group coaching is often called a “mastermind” program. A true mastermind program is moderated, not taught: the organizer introduces a topic, but group members share experience and advice. Teaching is informal; group wisdom may be recorded, but there is no single figurehead who says “do it like this”.

If you’re working with several clients around the same level, a mastermind group can be valuable. On the other hand, there are several reasons masterminds fail to deliver and sometimes fall apart. Here they are:

Pros of a Mastermind:

  • Very easy to operate and manage. A good ‘lifestyle business’ for the founder.
  • The founder doesn’t have to be the expert or have all the answers. They just need to connect people.
  • The founder can learn along with the group.
  • Masterminds provide a diverse set of experiences and ideas that no single expert can have alone.
  • Masterminds sometimes boost retention because of the bonds between members (there’s a flip side to this that I’ll cover in the ‘cons’ column.)
  • Founders don’t have to hire speakers or staff. Masterminds are very simple to run, requiring little software and human help.
  • Masterminds lend themselves to travel
  • Masterminds don’t have to meet often to be valuable. Many masterminds only meet quarterly.
  • If membership is closely curated, masterminds can warrant a very high price.
  • Some masterminds can keep clients around for decades, because clients never “finish learning the material”–the material changes as the other members learn.

Cons of a mastermind:

  • Most mastermind groups have a high churn rate
  • Founders sometimes act like teachers, which sidesteps the value
  • Hard to capture knowledge long-term
  • Newcomers struggle to catch up, or can slow the group down
  • Lack of individual attention means clients are always fixing problems instead of making long-term progress
  • It can be hard to separate opinion from experience in a group call
  • Tendency of a few members to dominate conversations
  • When a ‘leader’ drops out, they tend to take many with them (this is the flipside of the tight bonds between members)
  • Conversations can be repetitive – long-term members will get tired of talking about the same thing
  • Lack of client progress – the “doers” will take action and grow, but the other 80% will stagnate after a few months.

Key Differentiators Between Good and Bad Masterminds

Good masterminds do a few things differently:

  • they curate membership closely. You have to fit a very narrow criteria to get in and stay in.
  • they bring in fresh guests to start new conversations
  • they capture knowledge to bring newcomers up to the level of the group quickly (i.e. an onboarding course)
  • the leader acts as a moderator instead of a ‘source of all truth’.

Great masterminds are now including:

  • 1:1 plans and touchpoints for members
  • Smaller ‘boards’ or breakout groups by topic
  • Information capture – members with particular expertise teach it to the others in a more formal way, which is recorded and shared for posterity

Importantly, great masterminds get MORE exclusive over time. For example, EOS has amazing retention (sometimes clients stick around for over a decade). Clients are organized in Boards that don’t change; conversations in the Boards get deeper over time, and bonds are strengthened within the system. Newcomers form new Boards, so existing Board members can let their guard down.

At our mentorship practice, we have a Mastermind at the highest level of our ascension plan.

We start everyone 1:1 in our RampUp program. It’s very dialled-in, because we’ve done it over 2000 times. The curriculum rarely changes because we have so much proof of its efficacy.

Then we move everyone to Growth stage, where mentorship is delivered 1:1, but most discussion happens in a group setting. This is invaluable, because people share resources and experience freely. Though it’s growing, membership is curated: everyone in that group is in our mentorship practice and in the ‘growth’ stage of their business.

Our third tier is a mastermind group. This is because of the goals of the group. In RampUp, the work follows a set path to build their systems. In Growth Phase, where the goal is to earn 100k per year from their gym, owners can follow a large number of paths to get there–but not an infinite number. In Tinker Phase, where the goal is to become a millionaire, the paths are even more diverse. No mentor can be an expert in stock market investing, life insurance, Airbnb properties, multi-gym ownership, franchising…and so we connect the people and curate their knowledge.

If you’re a single operator starting a mentorship practice, it’s tempting to start a mastermind. If you want to learn from your peers, this might be the best way. But if you want to grow a practice over time, a mastermind might not be the first step in your model.

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