Starting, Scaling & Funding Your Business – Part 2, Advice from Julia Pimsleur
sometimes people think well i don't want to fundraise because it's too hard or i don't know how or you know nobody i know has ever raised money but if they sit down and map out what if i had another 500 000 or another million dollars right could i go into these new markets could i be the dominant player in my space could i start something way more scalable maybe you know an online community or building out products and often it gets people into a whole different headspace where they realize oh i do have a big enough vision that i should go raise capital and make that vision possible [Music] hello and welcome to million dollar monday i'm your host greg mazzello bringing you real successful people with real useful advice for people with big dreams i understand big dreams i turned an investment of 200 and a lot of great advice from some really successful people into my big dream pro forma that today is a half billion dollar company all right hello everybody and welcome to million dollar monday part two with my special guest today julia pimsleur if you remember from last week we introduced julia a very successful entrepreneur who built her own multi-million dollar business along with being now a scaling coach a mindset expert a great speaker and she's also the founder of million dollar women a new york city-based social venture that helps thousands of women entrepreneurs scale up their business julie is the author of many books including million dollar women which is a book that's just so chock full of great advice not only about her story but about women in business but how everyone whether you're a man or a woman should start fund and grow your business so let's talk about some of that advice julia that's in this book uh million dollar women about what what is the process you recommend for ideating a business and then making sure it's something that can scale and fund well it's great to be back with you greg and i love talking about how businesses can scale because i think so many people start a business out of passion or wanting to create something that they couldn't find on the market but they don't always have the right coaching or business skills to figure out is it scalable right i wish someone had sat me down to have that conversation early on in my business i did eventually figure it out but just to go personal a minute when i came up with the idea of little pim my language teaching program for young children at first i was considering doing schools like language teaching schools which would mean hiring lots of staff and having to figure out the real estate and you know there are a lot of restrictions around where you can have young children go learn and i quickly realized wait a minute this is going to cost a lot to get going and have a very heavy infrastructure so i quickly pivoted to making a video program which is way more scalable not a word i knew at the time by the way not a word i ever used i don't think i even called myself an entrepreneur i just wanted to start a business and the reason the language teaching video is more scalable is that while we did spend close to a million dollars to create all these different videos it was what's called a sunk cost which if listeners are not familiar with that it's one big cost that you you know spend but then it pays off for years and years so we created this video series over 10 years ago and we're still selling it and it's still being watched on screens every size everywhere all around the world that's a way more scalable model yes and and i love it and i love that you use the word pivot now that's almost an overused word here post covered right everybody sort of learned last year through covid that we all needed to pivot but i think sometimes people have ideas for a business and with a slight tweak or with a slight pivot as you used it they can dream bigger and have something that can scale and i know that you talk about the three critical questions you need to ask yourself about a business that starts with are you dreaming big enough that's right sometimes we put limiters or blinders on ourselves you know conscious or unconscious either we're afraid of going big because we think well then you know one what if i fail right or two what if then i have to give up other things like i won't be a good enough parent or spouse or you know sister or friend some people think it's one or the other where in fact when you scale up you can hire a team you actually have more time for yourself and it's really quite the opposite but i've seen a lot of people afraid to dream big and you know i work mainly with women i do think women have this problem more than men because we have fewer role models frankly oh we have a phone ringing do you want me to go turn that off and we can cut this out no you're good you're a busy person and we all get it sorry there's somebody else looking for advice right now it's usually a sales call on that it's a home phone it's usually a sales call oh somebody's trying to sell you a car warranty exactly so i and i do think i love what you're saying about worrying that you're not going to be a good enough parent mother or father rather than thinking through when i'm successful think of how much better of a mother or really father i could be owning my own business controlling my own hours being able to be there for every event my kid has in school every day you don't have to ask anyone's permission right right the other piece of the puzzle is being a role model for pursuing your passion and creating wealth and a business you love i mean what child wouldn't want to have that as a role model seeing their parent create something from scratch into a successful business yeah and i do think it's interesting i i never really realized this that women don't have very many role models i mean at the end of the day yeah i had a heart think hard and you pointed out there's oprah right and then there's martha stewart and then uh there's the lady that founded spanx right there blakely and tommy perch right but but if you ask someone who are the top women entrepreneurs you know they usually run out after five or six people whereas we can sit here and talk about you know steve jobs and bill gates and elon musk and name them all day long richard branson so you know we're just catching up uh as women we've been starting companies at twice the rate that men have over the last two decades women entrepreneurs is a really fast growing population there's 13 million of us we own 40 of all the small businesses but few of us are going big and that's what we set out to change you know a million dollar women correct and the three questions that i love them were of course are you dreaming big enough number two is your business scalable and if it's not what tweak could you do to make it scalable right and then the most important question and i think a lot of people don't think about this one what would more money do for your business yes sometimes people think well i don't want to fundraise because it's too hard or i don't know how or you know nobody i know has ever raised money but if they sit down and map out what if i had another 500 000 or another million dollars right could i go into these new markets could i be the dominant player in my space could i start something way more scalable maybe you know an online community or building out products and often it gets people into a whole different headspace where they realize oh i do have a big enough vision that i should go raise capital and make that vision possible yeah i and i do think that women especially you should read this book and i'm going to tell you why i think i'm am i saying this correctly that you your business because you went through different rounds of fundraising and we're going to talk about what are all those different rounds or different levels of fundraising but i think by the time you were really producing videos that your business had a valuation of three million dollars before you had very much in revenue is that right well valuation is an interesting thing and for people listening who aren't quite sure what that means it's just what your company is worth is considered to be worth on the market so when you go raise money you have to pin down a number my company is worth x and different industries have different norms about what companies are worth but in my industry which was ed tech right education technology we came out of the gate with a proprietary method our entertainment immersion method teaching young children how to learn a language i was a member of the pimsleur family which has you know a reputation for language teaching since my father you know created the pimsleur method which is widely used around the world and we already had great traction we'd sold 150 000 worth of product we were in magazines angelina jolie was teaching her kids to learn french with our method you know written up in in various magazines so we had a valuation of three million which basically means that your first investor believes you're worth that much and then other people then invested that same amount correct um and if achieving begins with believing it's just critical for people to understand it's possible you don't have to go be big to raise big money there are ways in which you can create value in your business through lots of other methods and so what you're saying is if you had a valuation of three million and then you wanted to raise three hundred thousand dollars approximately ten percent of your business is worth three hundred thousand dollars of course we're not talking about control necessarily or stock but but it's possible to raise a lot of money without being a lot of a success yet and i think it's important for for all entrepreneurs to understand that if they have a scale yes because you know one thing i wish i had learned earlier when i was raising money is that the investors care less about where you are today then they care about where you're going so you have a really clear vision and you can see getting your company there and you can map that out with your marketing plan and how you would use the funds you have a really good chance of raising that money now if you're a woman or a person of color the odds are not in your favor right i want to be really clear about that that it's changing slowly but right now it's about two percent of venture capital goes to women run businesses and for women of color raising money greg you won't believe this but it's only about a hundred women to date who have black women who have raised over a million in venture capital not not ten percent a hundred women so wow needs to change really quickly and it is a big new focus in the investing world to get more people of color funded businesses but it's gonna take time well i know there's a push throughout corporate america and and for more diversity i know there is in our business for more diversity and i'm sure in yours does that also find its way into the investing community to want to have more diversity in their investments right now is a great time to raise money if you are bipark you know woman person of color lesbian transgender queer this is a great time to go raise money because there's been a lot of awareness and attention to how do we get money into the hands of people who don't usually have access right and that's about leveling the playing field so absolutely a good time to go race all right so i we have lots of listeners now that i i hope they're excited to say wow maybe i could raise money tell tell our listeners about all of the different places where we find money of course starting like you did in our own pockets if you will but what are all of those different steps or possible ways of finding money along the way well traditionally entrepreneurs have funded their businesses through credit cards very simply right you can have credit cards and try to get the best rates and i know two or three businesses who got to a million that way you can take out a loan you can apply for grants you can do online fundraising whether it's through a site like kickstarter or indiegogo those are benefits oriented online fundraising where you give people benefits or you can actually get investors there is equity fundraising online now as well through circle and some of the other equity fundraising sites online but the more traditional way that i did was going to individuals called angel investors and pitching your business idea and showing them where you're going to go and how big you're going to take it and they write individual checks so my first big round of 1.1 million was all angel investors and then we moved on to venture capital after that so that's the bigger dollars venture capital it can start around 500 000 and go up to you know 5 million 10 million depending on the kind of company you have you know some industries like biotech need a ton of capital whereas if you have a product company you know like i did with little pim it was more like a few million that i needed to write so a lot of people don't have a network you it and you and i didn't when we got started and we knew very little uh but we met people along the way i like one of the things you said in your book that that that a really successful business person should spend 80 percent of their time out of the office networking meeting new people growing all of that knowledge and relationships uh where could people find those kind of folks that are angel investors well there's a whole ecosystem of investors i mean one thing we don't want to forget as entrepreneurs is that they need us as much as we need them i mean what are the rates at the bank right now right if you go put your money in a bank you're going to get what 1 and the stock market is really volatile but if you are an angel investor you have the potential to get a 50 or 100 return on your money so they're out looking for us just like we're out looking for them and you can go pitch at angel investor networks like i'm in new york city so of course a lot of angel investors here sometimes people do have to go to the nearest big city to pitch those angels but it's sort of a small world so once you start meeting people you can say well who else do you think i should be talking to follow-up fellow ceos who've raised money i certainly did that i sat down with every ceo i knew who had raised money and got their war stories certainly and some of their warnings about what to do what not to do but also ask you know who can i talk to and some of those investors became my investors yeah networking is huge and thank goodness there's things like google and ways to find those sorts of people and like you said there is hungry to find great deals as as business owners business owners are hungry to find the money so don't be afraid to reach out and just ask because they're also starving for some great ideas with one caveat if i may and i talked about this in the book which is that i like to liken raising capital to a kind of a dance because it's a dance that's been danced for you know a couple hundred years now between people investing in companies and entrepreneurs looking for money and it has very codified steps it's almost like the tango you ever seen the tango greg right very minut steps you can't make it up you can't ad lib fundraising is the same way so before you go out to network and before you go meet people read a couple books on fundraising you could start with mine there are others you know million dollar women i describe in detail how i went out to raise money i defined all the terms because there are a lot of terms it's got its own language and then once you feel like okay i really get how this world works and i'm ready to dance this dance i spent nine months doing that before i tried to raise one dime then go in because you only get one shot at it right so you don't want to be like learning all that while on the phone with someone who could write you a hundred thousand dollar check i agree and i imagine you would also tell somebody you should sort of have an understanding of what's the size of the market you're in and how are you going to capture a big part of it or how are you going to scale and be worth investing in somebody should have some sort of an understanding about how they might be able to do that but yeah that's part of the dance and part of the dance of how you approach an investor and what you should talk about during your pitch meeting i coach a lot of women on doing a successful pitch you know yesterday on one of my live shows i have a woman who raised 500 000 after you know we changed her deck and had her tell her story in a way that was more compelling so that's you know part of the dance and and uh to remind our folks who maybe didn't see the uh you know last week's video and i hope i encourage you to go back and see it you can see it on youtube here julia is also the founder of million dollar women as i've said in the introduction tell us a little bit more about million dollar women and what you can do to help people even people that are listening right now well million dollar women was set up to help one million women get to one million in revenues oh i love it okay well women are so smart and driven and capable but we tend to not have as many role models of successful women entrepreneurs and many of us haven't gone to business school or don't have a finance background so at million dollar women we fill in those gaps for women we help them think big and figure out what is the more scalable version of my business and we surround them with mentors and coaches and other high growth women entrepreneurs as we like to call them because not everybody's looking to build a big business right but the women who are have so much in common with each other and yet have a hard time finding each other greg so we brought everyone together and it's just simply at millionwomen.com we have a membership program women can join at three different levels and be part of this community of women going big yeah one of the things you mention in the book is having an outreach chart tell our listeners what that is and how you use it i have always had an outreach chart in my business i still have one it's a it could just be a google spreadsheet or an excel doc or if you use a crm write a customer relations management system you could keep it in there but it's simply keeping track of everybody you meet who could help you grow the business with different tabs right maybe one tab is potential investors maybe one tab is potential partners i always like to say if you can keep in your head all the people you're meeting you're not meeting enough people you're not no you're not you're not and this is part of what you brought up earlier right of spending 80 of your time out of the office which i want to credit vern harness the founder of entrepreneurs organization and of scaling up who taught me that and i remember when i first heard it thinking well how could i possibly spend 80 of my time out of the office right we got to get the work done but it's a great challenge if you're listening how could you set up your team to be functional without you because that is what's going to help your company scale and free you up to either raise money or go make the big deals or create the partnerships that are going to truly drive your business forward so if you don't think you can be out 80 of the time then it's time to take a look at how the business is running and think about how to make it more scalable yeah and i think maybe a lot of people hearing making a pitch making a presentation might scare them and i love one of the things that you wrote in the book and i think it was advice you got from somebody else about not worrying over worrying about it i think it was called like the 5 55 80 rule or something like that oh yes absolutely well i i've hired so many coaches one of whom is my mindset coach we talked about on the last episode but i've also had public speaking coaches business coaches and one of my public speaking coaches bill smart who was so fantastic helped me understand that people only remember seven percent of what you say it's these uh i don't care the exact proportions but it's something like the 7 18 55 rule and they remember seven percent of what you say 15 of what they remember is your body language and then the bulk of it is just your tone how you present your presence so if you haven't done work if you're listening and you're thinking wow going out to pitch how would i prepare for that you would want to work with someone who understands public speaking whether it's a coach or just someone you know in your network who can help you with that because how you show up matters so much more than what you say yeah absolutely i think i think in general investors are looking for people and there's only two kinds of people right there's people that are making things happen and people who are wondering what's happening and i think if somebody out there somebody that can make things happen that will come through in how you present yourself that and people people can believe you're going to do it and that's what people are going to invest in anyhow is the belief that it can get done if you can tell your story well enough right 100 and look no one's ever going to believe in you more than you believe in you so the very first thing to do if you're going to go out and raise money is really build up that belief like i can do this i'm excited about it it's going to happen no matter what and investors can feel that excitement and determination don't want to get on board with that julia it's been great spending time with you maybe we'll get a chance to come back someday and talk about your other book go big now but for now if you're thinking about starting your own business women or men if you know a woman that's in her own business or thinking about starting her own business or looking for great advice yourself this book is chock-full almost half of the book is really advice about how to start scale and fund a business julia thank you again and thank you most of all for what you're doing with million dollar women funding a million women to reach more than a million dollars in sales is very admirable proud of you greg thank you and thanks for having me on and giving me this opportunity to share what we're up to and i love what you're doing with million dollar mondays so yeah let's keep the conversation going absolutely thanks for being a part of it thank you [Music] you
2021-08-25 16:41
