dealing with the roller coaster that is being a human with emotions isn't easy, but when we open up about what's on our minds, we learn that we're not alone, that's why co founders Daniella Pearson, Mandy T fee and Selena Gomez created Wonder Mind the world's first mental fitness ecosystem with the mission to democratize and destigmatize mental health with honest conversations and expert advice. Wonder Mind is your roadmap for overcoming stigma, shifting your mindset and helping you feel supported and we all know that startup life is an emotional journey. That's why I'm thrilled to share with you wonder mine's first podcast, the business of feelings which surrounds conversations with those who have risen the ranks across a range of industries to talk about. Something that you don't often hear about their feelings. Every Tuesday wonder mine co founder and co Ceo Daniella Pearson sits down with industry leaders to learn about the intersection between their careers and their emotions and what their journey to the top.

Really felt like be sure to subscribe to the business of feelings on apple podcasts for new episodes every Tuesday and visit Wonder mine dot com for easy to understand articles that take the jargon and judgment out of mental health. It's Dune here your host and hype girl, I have just spent my morning working on the launch plan for magic and I am just so excited to be popping into your ears for our weekly mini episode Now before we get started, you might be able to hear the storm grumbling outside my window right now which is actually a soundtrack. I have missed so much living in London, so feel free to enjoy it with me if you can hear it. But in this episode, this week I'm answering all of your fundraising questions covering everything you want and need to know, but were too afraid to ask. A couple of weeks ago we had Jesse Gabriel from all places, hosting a masterclass for us in our network to spill the tea on all things fundraising and we were able to ask all the questions, it was so amazing To give you an introduction and a little bit of an overview to the woman of the hour, Jesse stepped down as an equity partner and head of the investment funds practice at a major law firm in 2020 to launch all places, which is a business and legal strategy firm seeking to create a more equitable world by actively helping women from all backgrounds and industries grow their business without limits.

And I would say our missions align pretty damn well. All places is actually the only firm in the U. S. That's focused primarily on female asset managers and entrepreneurs and in less than a year the firm's client roster has grown to include so many trailblazing consumer brands like Tash and some they have both been on the podcast to share their stories. So I would highly recommend also just giving a bit of a rewind and going back to tune into those. So jess is basically a well of knowledge when it comes to fundraising and the reality of being a female founder today, I would highly recommend jumping onto her website, which you can find in the show notes and signing up to her insightful newsletter. This podcast is brought to you by Clay vo, the email and SMS platform built just for e commerce brands. Start sending beautiful branded emails in minutes with a free account at Clay vo dot com. That's K L A V I Y O dot com.

Let's get into the nitty gritty of today's episode. The majority of jesse's workshops centered around the fact that it is so important for us as entrepreneurs to have a clear understanding of our finances and this is something that comes up on the podcast all the time. I'm sure you've heard it. Most of us understand the fundamentals of business management team, the operating systems market opportunities. But often there's this assumption that if things are in order and all these things are in order, the money thing will sort itself out. The chances are that if your model is robust, there will be opportunities to raise capital out there, but it won't mean that these opportunities will just land in your lap. You have to fundamentally understand the financials of your business and then use this knowledge to armor you for whether you decide to raise and which method of raising would work best for you. Founders should get as comfortable as possible with financials and financial modeling. I am someone that needs to get really damn comfortable with financial modeling and I'm not afraid to say it, it's not my strength.

I have to work on this, how much it costs to run your business, how much it costs to create your products. Every single line item I'm talking about here, how much it costs for you to live comfortably. This is what will allow you to realize whether your business is actually viable, You need to have a handle on your business expenses, otherwise there's no chance of this ever becoming a sustainable business. And this point reminded me of a workshop session we had with one of my favorite humans. Tash Williams, You'll be familiar with her episode, she's going to be joining us in magic. She is just an absolute gem and in that episode, she disclosed that almost every business owner she's ever spoken to doesn't have a full understanding of the facts and stats behind their data. And if you don't have this clear understanding, there's not really any way for you to know just how long your business is going to survive next. We moved on to the biggest question of them all to raise or not to raise.

Founders often divide themselves into two categories. Boots trappers or funded founders. The most obvious allure to bootstrapping or self financing your business is that you can continue to own 100% of the business, so you really only have yourself to answer to, you are literally in control of everything and this is a huge bonus in my books personally. Another thing that often gets overlooked is that raising capital is basically like a full time job on top of running your business. That means that during the process of raising a lot of time, a lot of effort and a lot of resources will have to be dedicated to this process and this process can drag on for months. We've heard it on the show, it can literally, it can last a year, it can last a really long time and in the meanwhile, your business performance will undoubtedly pay some of that price, especially if you're a solo founder. The big question you need to ask yourself in deciding your funding path is based around which kind of business you're looking to build.

You need to get real with yourself, what is your end goal? Another thing I'd say, especially with the current media landscape is that we see a lot of glamorizing the fundraise process, but it's not all glamorous, you really need to audit yourself because when you raise capital, you have multiple people to answer to, you're taking someone else's money and they expect you to return that money times 10 or even times 100 and you're gonna have to work really bloody hard for that. If you're looking to build a lifestyle business that you're happy to build slowly and you happen to have some savings to kick things off? Bootstrapping is clearly going to be the way to go. Take it easy, test the market and slowly but surely build your way up from there. At some point, you might reach a tipping point where it's clear that to go through explosive growth, you need a lot of cash. But also this approach just isn't gonna work for everyone. When we started building our non out brand, the objective was very, very clear, build this thing, scale it all the way to a lucrative exit And it required a lot of capital just to get started.

It required us to invest around $100,000 to get our first batch of bottles and the initial marketing costs and we just didn't have the savings to do that. We had to raise if we wanted to pursue that business. And when you have these kind of ambitions, the path of fundraising can be a really easy choice. So picture this, you started your business and you found out that you've definitely fallen into the latter camp. Your main goal is to exit at some point in the future and you want to grow quickly. So you've decided to go out and raise capital. But what's next? Not everyone can just go out and raise a million dollars, particularly women, particularly women of color, particularly latino women as we know, data shows it's a lot harder for women to raise money. It takes us longer and we raise less and sadly that's just the reality of the market right now. So how do you actually raise money? There are so many ways to raise money and even more names to label all the different ways and all the different times that you're raising.

And this is something that I've always found a little bit overwhelming and it can feel overwhelming being in a room where someone's talking a language that you don't understand yet precede this, a series that be series etcetera etcetera. Every investment round has a different name and we use these terms to indicate the size of the round that we're going to do and it is easy to be intimidated by the terms and to feel silly and doubt yourself. But actually no, don't be put off by these crazy terms. It takes a hot second to get up to speed with them. It's a simple google search and you've got this back to the workshop, jesse spoke to us through all the different financing options that are out there and available to us. It was super useful to have a clear oversight of this and it's something our community members benefited a lot from. So firstly you've got your good old fashioned debt as with bootstrapping you keep your whole business, but you take out a loan which you will have to pay back at some stage according to a certain set of terms.

You can also collateralize this loan on things like your home. But obviously that can complicate things and it's a pretty risky thing. It is nice to maintain full ownership, but you put yourself in an insecure personal situation should the repayment ever become a problem, Which we have to be realistic about? And the stats do show about 90% of startups fail and on top of this, it can be difficult to get approved for a loan as an early stage founder with little traction or reputation to go off the second financing option we talked about is how to raise on a convertible note. This in contrast is a great option for those early stage founders to get their hands on some capital. It's essentially a short term loan that will convert into equity a little further down the line after your business has had a chance to gain some momentum and build some traction. And it's worth noting that these notes exist with the expectation that at some point in the future you will raise another round and that the exact details of the price and value of the notes are pushed back to this stage.

Next we chatted about straight up investment shark tank style. I want x amount of dollars for x percent of the company and this can be raised through VCS or angels. These investors have the potential to serve as the lifeblood of a startup and are much more than just a capital injection. Although styles of investors differ wildly, you can expect to have pretty regular contact with them. It's safe to say that as soon as someone invests in your business in return for equity, you really start having people to answer to. And on the flip side of that, you can also gain people that can act as mentors and guide you along the way in considering this mode of financing. It's really time to ask yourself those important questions. What's your end goal? What kind of business do you want to build? And if you listen to the show a lot, you'll have heard many times that an investor relationship is like a marriage. You really need to know what you're getting into and who you're getting into it with. Next. We chatted about grants.

I've been blown away by how common this mode of financing actually is. After researching different grant opportunities for female entrepreneurs and shouting about them loudly on my Tiktok, there are just so many out there that you literally just need to find the cool thing is that these are just no strings attached cash deposits. The money is deposited directly into your account without having to give up equity or anything along those lines. The downside is that applications can take a really long time both to prepare and to wait for the results and that you have to find the opportunities in the first place. But I'm totally here to help you out with that second part, you can keep in the loop with me on Tiktok to find some of the latest grants that we are discovering online and last but not least, we touched upon raising money through crowdfunding. And this is usually done through a platform like I fund women, you collect small amounts of capital from a big group of people supporting you, which obviously adds up to a more significant sum and we've got an amazing master class from the team and I fund women in our network that you can check out if you decide to join us inside Magic when we launch next month.

Now that we have a good understanding of all the different funding opportunities out there, I just want to leave you with one very important tip when it comes to raising any kind of capital network is the right place to start. Best case scenario. You have a great network already that is supportive of you and your brand. But if you don't have that list, the time to grow, it is right now actively reach out to people before your fundraising, get involved in networking groups. It's hard and it's a lot of work, but that network is critical and it will continue to serve you over the course of your career and building your business. The network isn't going to necessarily be VC funds because they might not be the ones directly writing your checks because for them, it's mostly gonna be too early, but investors, always no other investors. And if you're in the process of raising right now, definitely drop me a note. I would love to learn more about your startup and see if I can help you in some way. Alrighty, that's all for today folks.

Thank you so much for listening in. There are so many different funding paths that you can choose to take with your business, but at the end of the day, it's all about being real with yourself and figuring out which path is best suited for you. Either way. I really hope this episode has come in useful in the process. And if you want to tune into the recorded workshop for more insights with jesse from all places, join us in Magic from december onwards and as always feel free to slide into my DM anytime I would love to meet you and I would love to learn what you're up to see you next week. Bye