Ideally, the potential sponsor would have completed the first nine Steps and be living in Ten through Twelve to qualify them for sponsoring others. In practice, it seems perfectly possible for someone to be well into Step Nine (without necessarily having completed it) to sponsor effectively. In fact, the sponsorship of others is such an effective way to access God that it actually provides an energy boost to complete the Step Nine.
Step Nine is the first Step that actually seems to bring about lasting change. I think that's why it's the turning point: where the potential sponsor starts to become what he or she is going to be in the future, and that is what attracts people to ask them.
Someone up to that point can help newer people with Stepwork, on Steps they have already completed. I get my sponsees to work with each other. This is super beneficial for everyone and allows people to get a taste of sponsorship before actually taking a sponsee on for real.