Raising venture capital in today's business world is tough. Raising venture capital for women's consumer products is extra challenging. Here's why: Female entrepreneurs looking for investors are faced with an investor pool that is 97% men. Those might be great odds for dating, but for business? Not so much.
One, if not the biggest, challenge I have faced with Jewel Toned is being tasked with raising capital for women's products in a male-dominated environment.
It is logical that most investors tend to invest in things that they themselves are passionate about, would use themselves, or really understand. Since investing capital is risky business, investors have specific focus areas where they have a high confidence level for investing. This logic lends itself to the fact that most men typically do not understand women's shapewear, which makes my job even more challenging.
For example, if I am analyzing a potential investment opportunity as an investor, and I hear that the product is, let's say, a new experimental drug for cancer that is being pitched as much more beneficial for patients because of X, Y, and Z. I personally have no idea if that is usable, or if there are other products like that on the market, or if it would be too risky of a venture because in my line of business I just don't know about the medical market. That's most likely how a male investor feels when I talk about shapewear. I have to use visuals comparing Jewel Toned's Major Mini Dress to traditional ugly shapewear so male investors can visualize why my product is better than all of the other options out there.
Also, since most men would not usually be buyers or users of women's consumer products, they don't really see a need to invest in them. So, it's like looking for a needle in a haystack. There aren't many of the 97% of male investor demographic investing in women's consumer products like shapewear. Those that do may only invest in 1 women's consumer product that year, so I have to convince them to choose my brand. Keep in mind that all of my competition wants their investment dollars just as much as I do.
"It's like looking for a needle in a haystack. There aren't many of the 97% of male investor demographic investing in women's consumer products like shapewear."
As the first female business founder to independently raise $1M in 2015, I think the fact that I even raised $1M is unbelievable. I recently went to a women's networking dinner and there were ten women of above average level of accomplishment, and all of them had only raised money with the assistance of male backers – not on their own. One had used crowdsourcing, but that isn't the same thing because it does not require any proof of concept. I was able to overcome that challenge, which leads me to my next point: As a female entrepreneur, you must have persistence and determination, because this is a long and winding road, and it is going to be tough. My biggest piece of advice to women out there trying to raise capital is not to give up. There are going to be a lot of doors closing on you, but you have to be completely unwilling to take no for an answer. That doesn't mean you bang on all of the closed doors, it just means that when one door closes you go down the hall and find another door to knock on. Sometimes you might even have to build your own door in order to make your vision a reality. Become your own force of motivation. This might require you to really ramp up your efforts because you get out of things what you put into them. Don't expect to put part-time efforts into something like raising venture capital and get monumental results.
"There are going to be a lot of doors closing on you, but you have to be completely unwilling to take no for an answer."
Once you get the funding, it's all about execution. Your idea isn't worth anything. Execution is. If you don't have the tools to execute your idea and bring it to life you need co-founders who do. Hiring it won't work at first because you need people to be just as in it to win it as you are. And let's face it if it's your baby only you will be that completely involved, at least at first.
"Once you get the funding, it's all about execution. Your idea isn't worth anything. Execution is."
Another challenge I face in my business is the constant chicken-and-egg nature of the startup business. You need funding to get products, and you need products to get more funding, and you need staff to get orders, and you need orders to get funding. Starting a business is a very delicate balancing act. Getting all of this done means moving one domino ahead half an inch, and then moving another forward an inch, and then turtle stepping each domino. In addition to managing raising funds, you must also successfully weed out the needless opinions and well-intentioned advice that goes along with running a start-up business.
Lots of people will give you opinions and tell you what you can and cannot do, and rattle off about this and that. Listen to your higher self and follow your gut. We don't know Beyoncé. So many people I pitch to say, “Hey, why don't you just get Beyoncé to wear your stuff?" I don't have her cell phone number, and even if I did, she doesn't wear people's products for free. In the startup world, there is a constant string of advice that doesn't even really apply to this type of business. Tune it out. Learn how to analyze and evaluate what is important. Unless the advice-givers have done exactly what you are trying to do before, or are as invested in your business as you are, you might need to take a step back and not hear what they're saying.
Once you experience that first round of success and accomplishment, you have to keep going – don't slow it down, but be mindful of striking a balance in your life between work and play. Having the grit to keep going is very important, especially in the face of rejection (and there will be rejection) but you also need to practice self-care, and that will look different for everyone.
We are all so connected in this world that it is very easy to work 24/7, but in order to be your best self and accomplish as much as you can as successfully as possible, you need to take excellent care of yourself. My routine includes making time to practice yoga, being close to people who nourish my soul, and going outside in nature so that I can remain grounded and focused. Do whatever it is that rejuvenates your soul and makes you the most productive version of yourself to stay focused and able to keep your eyes on your ultimate end goals.
WRITTEN BYRachael McCrary