Collectively, our Female Founders 100 honorees this year have taken nearly every path imaginable to fund the launching and growth of their companies. Below, we collected some of their smartest advice on how to get the money you need–and invest it wisely.
1. Only take smart money.
Pinky Cole launched her Atlanta-based restaurant, Slutty Vegan, in 2018 to prove to people that vegan food could be delicious–and a little naughty. People agreed: Revenue hit $4 million in six months. Investors soon came knocking–but Cole kept the door shut. “We were profitable, and I wanted more than money,” she says. “I was really serious about looking for a strategic partner.”
In May 2022, she finally found that. New Voices and Enlightened Hospitality Investments–the growth equity fund affiliated with Danny Meyer’s Union Square Hospitality Group–led a $25 million Series A round. The former was a no-brainer because it’s the firm of Cole’s longtime mentor, Richelieu Dennis, but the latter came out of the blue. After a few calls, Meyer and 10 of his associates showed up at the restaurant to chat over a meal. Cole knew she had a solid partner. “People come to Slutty Vegan for the experience and leave with the food,” she says. “And his team picked up on that immediately.”
Cole currently has five restaurants and plans to use the capital to open five more by year’s end. She says the wait was well worth it. “The people I do business with have to have the same ethos and the same ideals,” says Cole. “They don’t have to be vegan, but they do need to believe in the mission.”–Brit Morse
2. Craft a story.
“At the beginning, we were so fixated on explaining the problem, the numbers, how big the category was, the unit economics, we were almost forgetting to talk about ourselves as individuals,” says Sophia Edelstein, co-founder of glasses retailer Pair Eyewear. “Once we evolved that story and why we thought we were the people to solve the problem and why we’re passionate and can hire effectively, the response we started getting to the pitch changed. That’s when we started getting the first yesses, and soon we had a complete round.”
3. Keep the conversation going.
“Every time I reach out to an investor, I send them updates … I keep meeting with them, I keep talking to them, and showing them that we’re a purpose-driven company,” says Suzanne Sinatra, founder of health products company Private Packs. “I keep making our customer a real person to them. ‘This is a real problem: Look at this stat. Look at how many are suffering.'”
4. Get free advice.
“Someone advised me to treat pitch meetings like free consulting sessions–that’s when I started to enjoy it,” says Louisa Serene Schneider, founder of piercings chain Rowan. “One of my friends, a partner at a large venture fund, told me he didn’t think our original model of home-visit piercings would be our growth vehicle, but he’d write us a check once we did retail and had a line around the block. It gave me the conviction to open our first store–and we raised the money we needed before I could even have a subsequent conversation with him.”
5. Find your audience.
“I had to figure out a way to get to that next juncture without the traditional white male VC establishment. I decided I’d pitch only to people of color or to women,” says Tanya Van Court, founder of personal finance app Goalsetter. “The savior for me was Pipeline Angels. When I was seven months pregnant, I pitched in five different locations. I got funding in every single city. By the time I raised my first million dollars, 86 percent had come from Black people, Brown people, and women. That was my strategy. Find pockets of money where you have a shot.”
6. Spend within your means.
“We are fully self-funded, and I’m not a trust-fund baby–our growth has all been due to our reinvesting in the company, and we’re going to do about $45 million this year,” says Michelle DeLoach, founder of formalwear retailer Revelry. “The motto I live by is something my parents instilled in me: Live under your means. For people who do get funding, I advise they spend it just as they would spend their own money. I still own 100 percent of Revelry, and I treat myself like an investor in the company.”
7. Wait till you’re ready.
“Don’t underestimate how long things take and how hard they are to build,” says Julie Bornstein, founder of shopping platform The Yes, which Pinterest acquired for an undisclosed amount in June. “You need to be able to prove something to raise your next round, so make sure you have what it takes to do that. But also–and this is especially important to women–don’t underestimate how big your business can be.”
8. Look further afield.
“Understand that no is never the end, it’s just the beginning,” says Ashlee Ammons, co-founder of networking software maker Mixtroz. “We started our business in Nashville and heard no all the time. It was not going to be the place for us to grow. So we found somewhere else: Birmingham, Alabama. One infusion of $50,000 led to more. We raised our first million in Birmingham. They were able to see us as entrepreneurs in a way that Nashville would not.”
From the October 2022 issue of Inc. Magazine
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