Investing in Badass Women

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Investing in Badass Women

Published June 8, 2021

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How to make your dreams a reality? How to get funding when you’re not a trust fund baby or you don’t have hundreds and sometimes millions of dollars but you have a great idea, you have infrastructure, good partners and you have all of the things that are necessary except capital?

I’m very passionate about this topic, the topic being financial literacy for women. It’s something that I think needs to be addressed in the group. It is commonly addressed when it comes to influencers, who maybe don’t know their worth, or don’t know how to price things appropriately. It all sort of comes from the top anyway. And I just firmly believe that as women, we could educate ourselves so much more.

I was on LinkedIn one day and saw that one of my… I think she was a second connection. At this point. She wasn’t a first connection, had won a Forbes 40 under 40 Award. And I was intrigued. And I was doing all of this personal research to educate myself and expose myself more to women who were in the financial industry for women who were in VC funding specifically. And that brought me to Cynthia.

Jessy Grossman:
We connected over LinkedIn, a powerful resource that I suggest everybody scopes out, you should be on it more, there are so many more connections there to be made. And we connected ironically enough, she lives in the same Borough of Brooklyn that I do. So unfortunately, the first time only connected with via Zoom for this conversation. But fortunately, it was a really enjoyable conversation. It was very excited to hear how much she advocates for women.

Her professional journey is super interesting, and that she came from media, she understands this world, and has had a really interesting, professional journey that we’ll get into during this episode that I mostly want to bring to you guys and awareness of financial literacy. And I feel even just saying that term like it would turn me off if I were listening. If I were you, I might even shut off this podcast right now. So hopefully I can sell the debt. If you want to live of the life of your dreams.

If you want to feel more comfortable with your financial situation and perhaps live better and enjoy vacations a little bit more and not be stressed out about your finances and you want to invest in yourself. I just strongly encourage you to expose yourself to resources just like this. So Cynthia as way of introduction. She’s a C suite executive and entrepreneur with 25 years in e commerce, media and entertainment experience.

Previously, she was COO of a company that sold in 2012. And that company was the first 360 degree media and entertainment platform for Spanish speaking parents with kids zero to five. She is both a board member and an early stage investor in women and BIPOC LED Companies. She is a strategic adviser to Walmart, Bose, Audible slash Amazon and Sony Music Latin. She is now with a great company called Now With. I am super excited for you to learn all about her. And I hope you enjoyed this conversation. First and foremost, welcome to the podcast.

Cynthia Nelson:
Thank you for having me. I’m really excited to be here.

Jessy Grossman:
Absolutely from you know one ends of Brooklyn to the other and it’s nice to meet here online and record this podcast with you. As you know we heard a little bit about you in the intro to the show, but I just love to hear in your own words. Just a little bit about your background and sort of how you ended up where you are today.

Cynthia Nelson:
Oh, how long do we have? Just kidding? Um, yeah, I don’t think I would have ever thought I’d end up where I am today when I started out in business quite a few years ago, but I’ll take you just on a quick kind of tour. I actually was an art major, a fine art major, that realize I was good. But there were people in my class that were really, really, really good. And I thought, okay, they call them starving artists for a reason. And I’ll be one of them. So I switched to business, which is quite a drastic change.

And I fell in love with the computer industry. I was just like, okay, I can work as a receptionist at a computer company and I can get my homework done on this dot matrix printer. This is pretty cool. And then the became spellcheck, and I was like, oh, wow, this is like, change my world, you know? So I’m done talking like 80s, right, you know, mid 80s. And I just found that this whole new world of computers was exploding and I wanted to be part of it.

I worked for a couple small companies worked for a really big company called Ingram Micro learned everything about pick pack and ship. In fact, our sister company, Ingram Book was the back end for Jeff Bezos, Amazon.com when he first started, we were the book distribution side of Amazon. So he learned everything he knew about really amazing fulfillment and pick pack and ship from Ingram and went on from there obviously, was a great background, everything it doesn’t matter what you do, it’s all about execution.

And I think that was the grounding of in e-commerce, which really had just started. That was really what stuck with me. So I was recruited to work in Silicon Valley in the mid 90s. For Barry Diller’s first kind of endeavors in internet course he had home shopping network, who is figuring out okay, this new internet thing, can I sell stuff there too. So there was a company called Internet Shopping Network precursor for Amazon also that we built. And then we built first auction and first outlet.

First auction was a precursor of eBay. And first outlet obviously, was a precursor for you know, any one of the outlet stores that are there. So it’s basically a really another great training ground of someone’s putting a lot of money into this. I get to learn all these cool new things. And you know, we’re building customer service technology from scratch. There were no Salesforce. I mean, there was literally nothing out there but it was amazing.

An amazing time I saw a ton of companies in Sand Hill Road, which was a road with some companies there, but not anything like it looks like today. Stuff written on napkins. All of those weird stories are true. Pets.com you know, saw all of that, like it was a just a an amazing opportunity got recruited to work in New York for a company called Tribal DDB, which at that time was very young. We had probably four offices and maybe 50 people, and they grew out to I don’t know, they probably now have 100 offices around the world and 20,000 people maybe something like that all digital marketing, digital media, intranet extranet.

I worked with Betty Crocker and Spirit Sprint, Sony Music, a bunch of different kind of large clients doing things on the internet for the first time. Again, for the mid late 90s. I left New York City I was married at the time to a Latino. So I understood the culture really well went to Miami. He had a job at IBM went to Miami, and we ended up getting divorced but after that, I realized, you know, what do I want to do? Do I want to go back to corporate and do that I really liked being a consultant.

I like kind of flying free. I don’t have a risk issue. And I ran into somebody and was introduced somebody named Julian Sandler who was building this company called Todo Bebe, or everything baby in Spanish is what it means. And I stood up, that’s super interesting. I tailed her, I took her to lunch, took her to dinner, she find like, Look, this is going to be a 10 year flyer, it’s going to take a while because the market doesn’t understand yet. And I said I’m good. I’m good with that. I really want to be there. So I joined as a COO in 2004.

And we raise capital in 2008 and we exit it in 2012. We built the first 360 Media Company around parenting and pregnancy in Spanish. So we had television shows on Telemundo. And then on Univision international syndication, we had licensing deals, we ended up having product deals, we had a book deal with HarperCollins first trilingual apps in the app store. I mean, we really, you know, events in Walmart, parking lots home events, we really kind of did it all over the course of those, you know, nine years and it was like an NBA times 12. And I didn’t, you know, have television production experience.

I didn’t have licensing experience I did again, it was one of those things where I’m like, I’ll do it. She’s crazy. She’ll do it. It was the same thing I’d always done which was raise my hand and say, Hey, I’ll learn it doesn’t matter if I fail. I fail but I’ll learn something along the way. So I exited out all of this exit to a public company. And then I came back to New York to consult. Audible, worked on Walmart, worked with Sony Music, again, the Latin side and the US side building strategic platforms for them.

And then was recruited, oh my gosh, like six months ago, I’ve been investing in women led companies and really found a passion point of helping women led companies and saw the difficulty in getting capital raise and the misunderstanding of what it means to raise capital and why you raise capital. And when you want to raise capital, and putting yourself in the right position to raise capital, and these two women aborn Abra Potkin and Nicole Winnaman, found me on LinkedIn through another connection of theirs. And they said, we’re raising this bridge round.

Cynthia Nelson:
This is a company called Now With, you know, we’re really a shoppable Entertainment platform, we’re changing the way people are shopping. It’s influencers and talent that you love sharing the things that they love, it took completely different than anything that’s been out there. And it for me, it was this euphoria of oh my gosh, internet shopping network 1993 has now you know, now COVID, and shopping behaviors for consumers completely changed.

Now the pipes are there, you know, you’re now able to have curated video with products showing up that you can actually buy across any platform. So it was really an amazing technology that they had been building. And I raised some capital for them on that. And then they met Mark Laurie from jet.com. And Mark and Arod came in as part of their new spec, their new fund, they came in and invested, you know, $10 million in the company. They’re rolling it directly into a new series A for 50 million on $150 million evaluation.

It was just great timing, and I really disliked them I did was don’t pay me anything at the beginning. I just like you guys, let me bring in people that I think are going to be strategic to you. So that’s how that actually again, same thing I was interested curious to women with really significant backgrounds. You know, one from doing big brand deals with Ellen DeGeneres and American Express and Justin Bieber and my face and Abra, doing television syndication and shows for 25 years at Disney and ABC Paramount, they really understood the magic of talent and the magic of technology.

I was, you know, thrilled to just be hanging out in their sphere. And then they started to build the incubator at the same time. So we’re incubating brands now that we can run across the now with pipes, and push them out with celebrities, and then push them all the way to retail and to exit. So we’re raising $100 million on the Fund, which I will be and am now a managing partner of that fund.

It’s what I wanted to do for a very long time, which was be able to help women led companies, minority led companies, small companies actually get a leg up and be able to move them out into the real world and give them the working capital, but also, were real operating partners, everybody on our team comes from building companies from the ground up. So we know that staying up at night worrying about cash flow, understanding your people like it is a struggle and a half.

And it’s not for the weak, I think we come to it with a real understanding of what it takes to get there and real empathy. I say to every company I talked to look, if we get to a deal, that’s great. If we don’t get to a deal, you don’t like it, or we can’t do a deal with you. I’m going to tell you why. First of all, I’m never gonna let you walk away and not understand what happened because I’ve had that happen to me, and it just sucks. And the second one is if we don’t fund for whatever reason, or you don’t like the deal, my doors always open. If there’s a question that you have you want to ask or I have somebody in my network, which is pretty vast.

Let me know. And I’ll make the introduction or I’ll answer the questions. There’s no dumb question. I think that’s unique from a venture capitalist or an incubator kind of perspective. I think it’s pretty unique. The other thing we’re doing is also asking each one of these companies who are you bringing up behind you? If you are a female, I’ve got one. I’ve Asian American, Asian American women are not represented in beauty the right way. And I said, Okay, that’s great.

I think what you’re doing is really amazing. I really like the company. But what are you doing behind? Who are you bringing up? Are you a voice you know, now you have responsibility? We invest in you, you have a serious responsibility to be speaking about this right? Not only on behalf of your own brand, but if this is a passion point, you truly believe this, then who are you actually mentoring, you know, behind you and bringing up as the next generation?

Jessy Grossman:
Yeah, I know. And that’s so smart. Because, you know, look, it’s so interesting. The stat of 2020 was I think, 2%.

Cynthia Nelson:
Yes.

Jessy Grossman:
People who are funded are female, and that’s down from your four but then you conversely, you hear the stats of those 2% how incredibly they do and how much they maximize every single dollar. So I appreciate so much that it sounds like you’re thinking like, Alright, for us to get from 2% to an equitable percent, it could take, you know, forever considering especially that we’re going backwards.

Yeah, we have to think how do we get this into hyperdrive? How do we connect ourselves and bond ourselves with other women the legacy that we’re looking to leave so we can get this to where it needs to be? I so appreciate that.

Cynthia Nelson:
That’s it. That’s exist that you’re spot on, right? There haven’t been enough women in it and managing partner GP level right to make those decisions. And the ones that have been in there, and I’m not saying everyone, right, there’s great female VCs and investors out there. There’s a lot though that are in every time they bring in a female led company to the managing partners, it has to be so much better than anything they brought in before because they’re afraid, you know, first of all, it’s a female thing.

Then it’s gonna be 10 times better. Yeah, I’m not stating a fact from me saying it. But it’s been McKinsey and Forbes, I mean, women actually not only do better, they control the cash better, they spend less, they exit higher than male lead, especially in the technology side, a female lead technology company or female leadership, they exit better, their ROI is better. It’s a better investment.

I don’t understand investors who don’t look at the women side of the business, but I understand that the in their prejudice that happens, because you don’t look like me, don’t act like me, I don’t understand what coily hair is, yeah, I’m not sure about this femtech product that you’ve got me go ask my wife, or my girlfriend or my mom, you know, it’s not in there. Because there are so many men in there and so many white men in there, frankly,

Jessy Grossman:
Yeah, the most innocuous version and interpretation of that they’re just not exposed to it, you know, that like expose yourself, then, you know, to it, immerse yourself figure it out, it’s not our responsibility. The most innocuous version is they don’t know what they don’t know.

Cynthia Nelson:
Right.

Jessy Grossman:
So let us prove though, you know, like, I hate having to prove ourselves

Cynthia Nelson:
It is a fact that the questions that you’re asked as a female entrepreneur pitching for money are different than the questions that men are asked, there are different men are asked how do you build this to explode to a unicorn company and save the world? We’re going to ask how are you not going to lose my money, the risk side of the business, which is completely opposite.

Jessy Grossman:
And so I recognize that many of our listeners, they hear the first 15 minutes of our chat together, and they’re like, I want that but how in the world do I immerse myself in that how to win the world? Do I meet the right people have the right idea? When do I do this? How do I do this? And so if we could sort of take a step back to someone who has a great idea, right? How do they foolproof that what do they do to sift through it and make sure that it’s a great idea to align yourselves with getting some funding from a VC?

Cynthia Nelson:
So you know first when you have an idea I think the best thing to do is to go to your friends and friends that are honest with you right they’re gonna say that’s really stupid. You want to break this thing as many times as you can before you pitch it right you want to hire every, every objection of why it will not work so that you can a find out reasons why it does not work and you may have to pivot or come up with the opportunity of this is why it will work.

You need to be able to answer those questions quickly. These are pretty standard and the way they’re looking at things, right? What’s the size of the prize? Like? are you solving a problem? Is there whitespace? Are you solving a problem that people need to solve? Why are you the expert? Or Where’s your team the expert? Where are you the ones to do this? And is the size of the prize big enough, right? It’s a big enough market for you to go out top down, kind of how big it is, and bottoms up?

How are you going to acquire, you know, and attract consumers to buy into this idea or thought process with you? I think some of the most successful companies have been, you know, very granular in their initial testing of their idea, right? I know, the Warby Parker guys, when they raised their first capital, they were the front line for customer service for quite a long time, in listening to what customers really needed, and understanding what customers really needed and building a service and a system and a process. That was for consumers, they really, really were in tune to that requirement.

That’s where things go off the rails, I think it’s a great idea, but you don’t really have a true customer need, I think first got it from a business perspective, grounding yourself in the reality of, is there anything else that’s out there? If not, then why? Why hasn’t it happened? Why am I the right person to solve this problem? Do I have passion about it? Do I have experience in it? It’s you’re solving a problem for mom and baby? Well, you have a young child at home, okay, then you’re, you know, you seem to be right in that sweet spot, right?

Or I have a background in digital marketing or in development? Or like, what are those pieces that you already have in your toolbox? And then, conversely, what are you missing? And who are you missing and kind of finding other people that are in the industry or in a light position that may give you some really great advice for another perspective, asking friends and having them shoot it down, and then asking perfect strangers, you know, going out on LinkedIn and looking for people who may be in a position to give you some advice, I would say 99% of the time, it doesn’t matter who it is on LinkedIn, if they get an in message. Look, I’m trying to test this out, you seem like you’re an expert, I really need just five minutes of your time. If you could take a call or if I could ask you questions. They’re going to give their time because they’ve all been there.

Jessy Grossman:
I love that I’m going to someone who runs a networking organization 1,000%. And look, I always want to give people like really practical resources as well. I love theory, but I want to have people have actionable things, too. You know, I reached out to you on LinkedIn after we connected on there. And I’m so glad we connected and will continue to connect. And that was because of one message. And it seems like you’ve experienced that before. And I appreciate that, while we’ve been there.

I’ve been there somebody give my time to somebody else. And also, network is very much a two way relationship. I think there’s definitely a misconception about that, especially with some young women, young people who you know that they’re like, Oh, I don’t want to take up too much of their time, or they’re so busy and no way because of you have value to bring to them as well. And maybe it’s not in that exact moment. But they will tap you for something where they will absolutely be a value exchange.

Cynthia Nelson:
A hundred percent. A hundred percent.

Jessy Grossman:
Definitely otherwise, it’s a hugely missed opportunity. And that’s on them.

Cynthia Nelson:
Completely. I think getting over that I think a long time ago, you know, no, is a very small word, tiny little, it’s got two letters is really, really small, right? And sometimes no it’s just not right now. But it doesn’t there’s not always rarely have ever seen a completely closed door, rarely. And everybody had somebody help them along the way.

You know, even if you don’t realize it’s a mentor at the time, it was mentorship, you know, we’ve all kind of experienced those moments where the person someone says something to you, and you think back years later, like oh, yeah, they were so right. I am a nutcase. I don’t always belong in a box, you know, I’m not fit for that. And that’s okay. Do what you feel is right. And I think also we are not taught, especially I think as women, to listen to ourselves, and to really take our conscience and our heart into consideration when we’re making decisions about what we want to do with our lives. And we kind of step back and we don’t stand in our own truth as often as I think we should.

And it does come with age and maturity and feeling better in your own skin and not uncomfortable. I think if we can teach those lessons so much earlier in life, it is starting to change because the next generation coming up has a very different viewpoint about the world, about ecology, about the planet, about where they want to work, how they want to work and who they want to work for, what products they want to buy, why they want to buy those products, and what they’ll share with their friends. I think it’s becoming the standing in your own skin and feeling good about it is a badge of honor, not something to deflect and feel weird about, or that’s a big part of entrepreneurship, right? You’ve got to believe in yourself,

Jessy Grossman:
You have to. A thousand percent. I’d love to talk a little bit about the people that you surround yourself with, you know, I heard you really, and your story of your professional journey really spoke about there’s a curiosity there and a desire to learn. And you seem like you followed that, like that was your North Star. And I’m sure that led you to all sorts of great people and lessons to be learned and all of these things. So I’m curious for those listening right now, I want to find my people, I don’t feel like I’ve found them yet. I want people to bounce these ideas off of. I want someone to call me out on my bullshit and say like, No, no, no, no, no, you need to pivot that is not the idea. Right? find these people practically speaking.

Cynthia Nelson:
I mean, you know, it’s a new world, right, you know, Google and LinkedIn and you know, social is a great way to start right looking for people on LinkedIn that are unique or different or in their in an area that you think you want to be in. Also, I think surrounding yourself with people that have superpowers that you don’t have, those are, you know, knowing kind of figuring out what your superpower is, or what you think you want it to be. And then trying to find other people who have maybe even opposite superpowers of yours, right?

This person is really great in technology. I’m horrible in technology but I know influencer marketing really well or corporate ops really well. Let me find other people and find people that are smarter than you. If you went to college, you know, your College Alumni Association is a great place to go. Women’s networking organizations. I know we haven’t done a lot of networking the last year because of COVID, that it’s going to explode.

Albright is a great organization, by the way, if you don’t know about it, they’re from the UK but they have actually physical spaces in the UK. They’re kind of a, I would say hipper, cooler, women focused like an all ages of women, by the way too. Organization and group that gets together these really beautiful locations and it’s all about networking, and learning and growth. Joining one of those and most of those places are going to give you a free pass like to come in and sit for a day and look at them and talk to other people that you’ll feel your vibe, you know, you’ll get it’s like, oh, this is don’t feel it right away. Don’t try to force yourself into it.

Jessy Grossman:
For sure. Do you feel like your superpower has changed over the years? Or do you feel like if there’s always been very clear superpower that you’ve had.

Cynthia Nelson:
I think my superpower has been the same. It’s iterations of it. The curiosity side has always been there of just try it. Just go try it. Like who cares? If nobody else wants to do it, you can go do it, you might learn something. I was actually told something back when I was working at Ingram so this is like early 90s. And I’ve repeated it probably 100 times to other people. I had a mentor and I didn’t realize he was he was a mentor at the time.

I was very frustrated. I was trying to do bigger things and was kind of in a box. And he said his name is Whyschi he went on to run as chairman of Elsevier, which is a really big book publication company. He said, You know, you’re like this person who is in the desert. And you run out into the desert, and you found water and you come back and you tell everybody Oh my god. There’s water. Believe me. There’s water. Like Yeah, Cynthia, you just full of shit. And there’s no water out there. And okay, you go out again in the desert, found water? No, really, there’s water, there’s water. So by the third time you do it, someone comes out and they’re like, you’re Rica, you’re right, there actually is water.

Then a bunch of people come out. And by the time they come out, you’re off going doing something else. He said, it’s not always easy to be ahead of the curve but it’s okay. If you see things that other people don’t see, don’t get frustrated by your vision or by your ability to do that. Just know that not everybody’s on the same train with you. And if you can convince them to come out and look at water, that’s great but by the time they think it’s really cool, you’re already… you’ve discovered gold.

Jessy Grossman:
What a good story. I love that so much. I appreciate that.

Cynthia Nelson:
It made me leave the company, I realized I was like I have to get out. I need to go get out and do something different.

Jessy Grossman:
So good. I’d love to also pivot a little bit and just talk about how to know if your idea is best for VC funding. How do you know if that’s the route to go versus self funding versus an angel investor? How do you know that is the direction to go in?

Cynthia Nelson:
Yeah, well, first of all, VCs won’t just take an idea. That’s not going to happen. So you’re not going to go to a VC for funding until you actually have real market traction. You’re selling… the products or services. You’ve shown that you can attract customers to it, you understand your customer acquisition cost your cltv, you have a real grip on the business. So you may have self funded or gotten Angel funding and you’re doing a million, two million you may not be profitable yet, but you’ve shown and proven that you have a case there. And if they put gas on the fire, which would be their money, right and their help, then you should be able to blow it out and actually make a lot more money and grow the company.

VC funding is not a first step for anybody, they won’t actually look at it, it’s kind of ridiculous to send a deck to a VC with no traction on your company at all, it would be extremely unusual, unless it was potentially someone who had two or three exits behind them already, you know, was a serial entrepreneur with several exits, maybe out to a public, and that really had a space that they understood very well, or even a new space, that they have the background, and the wherewithal and the grit to actually grow a company. So really, the best opportunity is to try to fund it yourself and friends and family at the beginning.

Jessy Grossman:
Definitely. And I think that that could be a great idea to perfect that pitch, you know, and to prove all the value and lots of great things to sort of in preparation for your journey down the line. So in perfecting that pitch, you know, what are some tried and true things that as we predict what people are going to ask. What things should you have in your arsenal to be able to talk about this talk about that? What does a great pitch look like?

Cynthia Nelson:
I mean, a great pitch is probably eight slides, right? If you can’t get it across in the first three slides, actually, the first first slide of what this is, if you can’t articulate it, you’ve lost the audience, right click gone. So it’s really what’s the problem? What’s the solution? What’s the size of the market? Who’s the team to solve it? You know, what are your next steps? And how much money do you need, how you’re going to use it? That’s it, that is a pitch and literally on Google, you can google best pitches ever.

And there are loads of pitches. Airbnb is first pitch, Facebook for, you know, all these companies that became unicorns. All those pitches in whatever iteration they’re out there, you’re able to look at them, you know, slide deck has a ton of them. I mean, there are more than enough resources to help guide someone in all different categories about what a pitches and even like I think it’s either Andreessen Horowitz or Kleiner Perkins, I think it’s a quiet, they publish, this is what you need to have in a pitch deck, it’s very clear.

Jessy Grossman:
Providing that information, it’s helpful for them, you know, again, it’s all ideal, there’s a value exchange for everybody.

Cynthia Nelson:
Don’t make them work, your job is not to make them work and sift through your 50 page deck because they won’t do it, it’ll go in the trash, or their email trash, right? They’re not going to do that. So and if you’re emailing them, which is a great way, you know, cold intros, they do take cold intros, they didn’t used to as much but with COVID, they’ve become very used to getting cold intros via email.

What’s in it for them? Is it in their thesis? What companies have they invested in that look like a duck? Do you look like one of those types of companies? Are you the type of a CPG company, but they only invest in, you know, fin tech? Well, you’re barking up the wrong tree, right? And who are the other people they’ve invested in? What’s their portfolio look like? Do you fit in that portfolio? Do you believe that company would fit in a portfolio, and then when you’re talking to them, it’s, you know, one sentence about the problem that you’re solving and why.

And then these are three things to know about us. And then we’d like to actually send you our deck, or here’s our attached deck. And then following up, don’t be afraid to pick up the phone and call I mean, they do have phone numbers, at least a corporate number. And you know, and sometimes the squeaky wheel.

Jessy Grossman:
For sure. I’m just thinking how much more impactful a pitch would be, like you mentioned with, you know, some level of success already behind it, whether it’s like a proven concept or you know, customers acquired or things like that, is there a certain time that you would say, you shouldn’t wait longer than this, or you shouldn’t have this occur in order to reach out to possibly get funded, maybe it’s too late.

Cynthia Nelson:
The only times I say that it becomes too late is when you’re running up against you know, not being able to scale at all, like you’ve hit a wall related to capital, to acquire customers or to build innovation or whatever it happens to be that you’re doing and you’ve hit a wall. It is come faster than you thought. If you’re going to fundraise you need to be at think about fundraising.

As soon as you start the company like whether it’s Angel fundraising, crowdfunding is a great way to start without having to take on any equity. Great way to test the market and test the theory but then you’re always don’t want to run into a situation where if you’re out of gas in six weeks, and the company folds because you’re going into a negotiation, with absolutely zero ability to negotiate.

Jessy Grossman:
Let’s talk a little bit about the funding process when you are maybe between a few different people that you think are a good fit. What is going to be this distinguishing factor? What’s reasonable to expect, in terms of, do you get the money and support?Do you get the money and expertise and connections? Or do they sort of rely on you to just like, hit the gas, and that’s your job we just provide you.

Cynthia Nelson:
I mean, there’s two sides of it, right? There are definitely a lot of VCs out there and investors in general, that just give the cash. They’re not in your business, they’re not in the type of business that you’re in. So they really can’t provide the expertise, or it’s really not in their thesis to actually do that they don’t have operating partners, right. They have partners. They’re not in your business all the time.

I think when you’re choosing a company to get funding from, it’s just as much of a you’re dating a lot of people, you know, it’s a select group of people, I wouldn’t say a lot, but you’re dating enough people that you understand, it’s got to be a really good fit for you, too, you should be investigating that company, as much as they’re investigating you, you should be talking to and they start getting very interested, you say, look, I’d like a couple of references of companies that you funded, I’d like to talk to them about the process about your interaction with them, they should be willing to give those to you if they’re interested in funding, that is a natural thing for you to ask for.

A lot of people don’t ask for that. They just are so desperate for the money. And they become bad investments usually, not always, but they don’t they’re not really looking at the whole picture. It’s not about the capital, although the capital is really a driving point. It’s what else can I get from this person? If they’re gonna sit on my board? Which they do a lot of times? What are they going to provide me in terms of support? Or are they just going to get into a meeting every quarter and nail me because the numbers aren’t? Right?

Jessy Grossman:
And so is there a length of time that you would expect to, you know, see certain returns? Or is that just sort of negotiated in every in the different deals?

Cynthia Nelson:
I mean, it’s it depends on the company, right? I think some companies can scale much faster than they’re at different stages. So they can scale much faster, or they need less of this and more of this, right. You know, usually within we like to be in and out and in probably three years, or getting them to a series A which will probably participate in series A but once they get past that we’re kind of out

Jessy Grossman:
I have a great layman’s terms, you know, intro question. For those listening, I’ve heard the term series A before I’ve heard the term. What sort of keyword let’s start with series A, if you could just sort of describe what that is. And maybe we could sort of demystify a few other terms that we’ll hear thrown around often.

Cynthia Nelson:
Yeah, series A is when a company actually has a product in market, you know, considerable traction with consumers. They’ve shown that they can be profitable or get to profitability at a certain point in time. And they actually are starting to own the market, there’s a white space there, and they’re starting to actually either disrupt a market or create a whole new market, or the product is just doing very, very well.

That’s a series A, you know, there’s things called Super Series A or pre series, and there’s a whole bunch of kind of terms that are being thrown around. Usually, for me, at least a series A is $10 million plus in investment but for some capital companies, like you know, I’d say like a Greycroft or Sequoia, these big guys, they won’t even touch a series A unless it’s a 50 million to $100 million, series A. It’s also levels of investors, and what they consider a series A to B and they’ll participate in or they won’t even look at a company that smaller of $10 million round, they don’t care. They’re looking at a company that’s doing 150 because they have the ability and the cash to put into those companies to really make them rocket ships, right. If they’re too small, no matter what the money they put in. They haven’t proven the model yet to get there.

Jessy Grossman:
That’s interesting. And what about like angel investor? Can you define what that is for everyone?

Cynthia Nelson:
I mean, angel investors are usually their investors who are spending between $5,000 and probably $50,000. They’re usually in groups, right? There’s new york angels. There’s Angel groups all over the country for all different types of reasons. And companies, very easy to find them. You just have to go on Google, like they’re everywhere. You get involved with an angel group, they’re high net worth individuals, sometimes that have expertise and capital a share.

They’re making very, very early stage investments. Again, they’re much lower cheque sizes, but they’re risking on companies who may not have you know, have a great idea but may not have any traction at all. So their pre traction, great idea, need to get the funding just to prove the thesis. That’s where angels actually come in friends and family kind of same thing, right? You’re just getting the capital to prove that there’s a problem and you’ve got a solution to it.

Jessy Grossman:
I love that. I appreciate that. I think it’s so important to just to find these words. We use them and but I want to be cognizant that not everybody listening, even know what those are. The point is to demystify it and help people just understand when to navigate it really well. And my last question for you for today is, if you were to leave our audience with parting words, and what to keep in mind, in terms of growing a company. What are the most important things that you would tell them?

Cynthia Nelson:
There’s so many, right, I think that the one thing is just perseverance and grit. This is not for the weak, if everybody was it was so easy, everyone would do it. So believing in yourself, and surrounding yourself with people who believe in you as well, but also are honest with you, I think those are extremely important, but the perseverance side of it, and also being able to understand that if your idea isn’t great, maybe it’s just the timing.

And maybe you can pivot to something else. I’ve seen enough CEOs that have really great product, great market fit, but are unable to see that they need help, and maybe a co founder or an operator in there that can really help them they get so blinded, and so in love, which you want them to be in love with their product that’s so in love with it, that they’re not able to see that there’s help to be had. And it would make them that much stronger, to take on a co-founder or someone else who is the opposite of them that could really operationalize their business, for example, or understands finance, or really can get them into retail.

Whatever it happens to be having a really open mind and really listening when people are giving you trying to give you advice, really listening versus putting that shield on. Like they don’t like my idea so they suck. They’re trying to tell you things that an investor is going to tell you but in a much harsher way.

Jessy Grossman:
Definitely. And you know, people, it’s easier just to give good feedback, it’s easier to just say like, good time, it’s good. But you know, to give that constructive feedback, at the very least, it’s worth really listening to and really taking in and being able to have that self reflection to say, I mean, that is that’s one of the key roles of somebody, I’ve witnessed this to have people who are particularly successful, they have that. So I think that’s so key for you to bring up. I really appreciate that. I have so many questions for you. We could talk for a while maybe we’ll do a round two of this.

Cynthia Nelson:
Anytime.

Jessy Grossman:
I’ve been so appreciative of your time today, I have a feeling that a lot of our listeners would love to get in touch with you and perhaps ask a few follow up questions. What’s the best way for them to get in?

Cynthia Nelson:
I’m on LinkedIn, you can send me a direct message. I try to answer everybody. I had somebody the other day that set one and she works at a grocery store. And she was really trying to find her North Star and like, how do you go about doing that? And like, I gave her some advice, but here’s your homework. And we’ll see if she comes back. And it was simple homework, but it was like, we’ll see if she comes back. I’m willing to give five minutes of my time if something but you got to do the work. I can’t do that kind of work for you.

Jessy Grossman:
You do have to do the work. Absolutely. Cynthia, we’re gonna link your LinkedIn in the show notes. Such a pleasure, and so appreciate your time. Thank you.

Cynthia Nelson:
Great. Have a great day. And I know it’s Memorial Day weekend. So have a nice time off and we’re getting some good weather here in New York. So I’m happy.

Jessy Grossman:
Yeah, I hope so. Fingers crossed. Thank you again.

Cynthia Nelson:
You’re welcome. Take care.

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