Hi Fearless Friend!

Today on Stay Fearless or Die Trying:

1. Why your startup might not be ready for fundraising

2. Startups that fell into the fundraising trap

3. Meet me at London Tech Week in June!

4. And…Harvard in November!

It’s all about the $$$

People get into the startup sphere for many reasons. They might have a life-changing idea, or they want to get away from the typical 9 to 5 world. None of this can come to fruition without one big factor: money. Now, I consult on a lot of different startups (find out more about one-on-one coaching here) and since I’m the queen of cold calling (which I like to call myself) there are many similarities between your traditional cold pitch and the way to go about getting in front of venture capital.

When I started my blog A Life in the Fashion Lane in 2011, I saw it as an outlet for my thoughts, and opinions, and a way to get away from the struggles I was facing in my small town. Through years of hard work, I have been able to grow that teenage blog into my Be Fearless brand. But for a long time, there was no money in it, it was just a way for me to connect with the outside world and grow as a person. This track is rare, especially for adults looking to start something specific.

How do people know when to transition from a side hustle to their main focus and income? Through making lists and comparing info with other professionals, I realized it’s more about knowing when you AREN’T ready, instead of looking for when you are. This came to me in the form of questions you can ask yourself. If you can give these questions a good counter, you might be ready for the fundraising phase.

1. Why would people give me money if they don’t understand what I’m doing?

This one is first for a reason. Vague ideas, and simple and non-fleshed-out business plans, are going to get you nowhere. Putting your hand out and saying “I have ideas I need money for” is going to get you laughed at. Investors aren’t people who trust easily. They have to have full confidence that you know what you’re talking about and have a plan to see it through.

I try to keep up with the Kickstarter sphere, keep up to date on up-and-coming products, and see what the community wants to invest in. Many Kickstarters fail because they aren’t clear enough about their business, what their product does, or their plan to get their product into consumer’s hands.

One of the most notable fails in business plans is the Kickstarter for “The Coolest Cooler” While they succeeded in the fundraising campaign in 2014, raising over $13 million from over 62k “backers” on the site, the product completely flopped because they didn’t think the business through. This failure has made investors much more skeptical of new products. “The Coolest Cooler” boasted that they would include LED Lights, a blender, and many other bells and whistles without fully planning through how to get this done.

They ran into constant speed bumps because of their lack of planning. They struggled with supply chain issues for the components of the cooler, they didn’t think through the pricing of the product related to the cost to make it, and they were quickly in over their heads. Backers that gave thousands of dollars never received a product. The company broke down and ceased all operations. The Kickstarter hasn’t been updated since 2018. What could have been a great product completely fell apart due to poor business planning, and completely shifted the trust of the Kickstarter community to be way more picky about what they choose to invest in.

2. Is the market too saturated?

This one goes back to last week’s edition. Nobody is going to want to invest in a basic business that hits a market that’s already being met. You have to do extensive research into the market for your business, understand the strategies of the businesses that already exist, and find a way to meet missing needs in your market. If your idea isn’t doing all of those things, nobody is going to see the value in investing in your idea as opposed to buying stock in the existing one.

It’s a bit harder to find notable examples for this one because these products usually fail so quickly they don’t get much traction at all. But one example is the company Juicero. This company was formed in 2016 and marketed itself as revolutionary in the home-juicing game. Somehow they got over $120 million from investors and launched an overpriced product at almost $700.

This company didn't even last a year. They tried to get in early on the subscription game and had a partner product of juice “packs” that was the only way the juicer could be used. So you’d have to buy a seven hundred dollar juicer, and not even be able to use it on grocery store fruits and veggies. People also quickly discovered that they could squeeze juice out of these juice packs by hand, eliminating the need for the juicer itself.

This product also came at a big health food boom for consumers. People wanted at-home juice. If you look it up right now, you can buy a basic juicer for just $60. Why would anyone want to pay over 10x that for a product? They completely overestimated the value of the product and didn’t look intently enough at the other products available to realize their product was extremely overpriced. They were shut down in 2017 and owed millions to investors who were looking for returns on their investments.

3. But, my team is just me?

When I say “resources” I don’t always mean money. If you haven’t built a team of people, or at the very least have a plan for this team, there’s going to be a lot of doubt that you can follow through on your idea. Now you might be thinking: Alexa, how do I build a team with no money to pay them?! I hear you! At the very least, you need to know what you need to have to get the project running. These people need to be the first recruits you find to get on board with your project.

You need (and some of these roles can be filled by the same person!):

• The founders: That’s you! And maybe a partner that you can share some of the workload with, bounce ideas off of, and make big decisions.

• A finance person: Whether it’s an accountant, a CFO, or a friend who’s good with spreadsheets, you need someone on your team dedicated to the numbers. Monitoring expenses, income, taxes, and more to make sure you aren’t underwater before you even begin.

• Customer support: I’m not saying you need a whole person to deal with FAQs, but someone on your team needs to be assigned to handle problems as they come up, relaying them to the rest of the team, and communicating effectively with your customers.

• Marketer: However you plan on getting the word out about your idea, you need someone to bring that to life. Making ads, posting on social media, and participating in relevant events. If there’s nobody on your team who knows their way around Instagram, it’s unlikely your brand will spread the way you need it to.

• Someone tech savvy: A lot of times this falls in the same boat as the marketer, but you need someone to help you get a website up and running, to link products and pages to posts, to know where to look for different tools to make your business grow.

If your team doesn’t include people who fill all of these roles, investors might think you aren’t prepared to deal with the work it takes to build a brand. You can’t do it all yourself!!

Sometimes you can even have a leg up on competition by being one of the first in your field, but if you don’t have a team, that leg up means nothing. A great example of this is one of the first social media sites, Friendster. It started in 2002 and gained millions of users and media attention. However, they did not have a team equipped to handle the development of the website.

As it grew, there were more and more crashes and shutdowns, errors and failures. They did not have employees versed enough in the web design sphere to maintain the growth. They lacked marketing and business advisors, turning down partnerships with Google and not investing time and effort into advertising. They lacked a vision, a group of people at the top who could see where the growth was supposed to go, and they had no model for generating revenue. Within a few years, the site lost all traction, and it was shut down.

This horror story highlights the importance of a good team. Had the founders placed priority on hiring marketers, financial advisors, and tech support, it could easily be the Facebook of today.

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4 places to find leads for public speaking opportunities:

1. 100+ brands list (here) - use this list to cold pitch to corporate companies who are looking for speakers

2. Cold pitch a YMCA or Boys & Girls Club (they are always looking for guest speakers)

3. Schools like Fusion Academy

4. Brands like Be Fearless and Female Founder Collective (they pull from members for future speaking opportunities so make sure you become a member)

This week on The New Unfiltered:

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Plus, catch me speaking in 2024 below:

Meet me at London Tech Week here.

And stay tuned for my Harvard talk in November with updates here!

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