You're ready to pursue an aggressive growth strategy, but there's only one obstacle: funding.
How do you get it? Where do you find it? Most importantly, what shifts will you have to make to your current way of doing business to secure that funding?
To help you along your path towards growth, four women trailblazers share how they got the funding they needed to transform their businesses. From seed capital to business loans, they'll share how they did it.
Using their advice, you can handcraft a path towards funding success to accelerate your own growth strategy.
1. They focused on a vision.
Dawn Anderson's OHi Food Co. was chugging along just fine back home in Hawaii. Founded with $5,000 of her own savings, Anderson quickly built a name for her plant-based superfood bars in 200 stores across the islands but hungered for a wider reach than Hawaii alone would allow.
“Our biggest obstacle was finding an investor who would partner with us when our revenue was below $1 million," says Anderson. “We had retailers and distribution opportunities that would increase our revenue but required financing to move forward."
Anderson focused on finding an investment partner that believed in her company, product, team, and vision. She ultimately found that match in Boulder Food Group, a venture capital group that explicitly provides funding to early-stage food and beverage companies.
Thanks to this funding, OHi Food Co. relocated from Hawaii to California and upped production from 500 handmade bars per day to 20,000 bars in their new facility. They've also grown from Anderson wearing all of the hats to employing three strategic employees and a national sales team.
And being in 200 stores only in Hawaii is a thing of the past. OHi bars can now be found in over 1,000 stores across the U.S.
2. They focused on sales.
As the CEO and founder of Bittylab, Priska Diaz had a proven hustle for new sales. After all, her baby wasn't the only kid out there who suffered from severe reflux following bottle feeding. Her company's air-free feeding system designed to reduce reflux symptoms in babies caused by bottle feeding had rung up over $75,000 in direct-to-consumer presales ($50,000 in a mere 24 hours).
Now, Diaz thought, if only the nation's number one baby retailer would come calling—then she could grow Bittylabs by leaps and bounds.
Well, that retailer did come a-calling, which meant that Diaz needed to boost production to meet the retailer's demands for the product launch. Business loans for women in the startup world are tough to qualify for, but Diaz knew that she could frame a reasonable risk-reward scenario for prospective lenders.
“One of the requirements we needed to obtain the loans—and that was feasible—was to get the commitment from the retailer," says Diaz. “The only catch was that the retailer would only provide purchase orders one month in advance and we needed at least three months to produce more inventory."
This sent Diaz to the negotiating table, eager to find a win for Bittylabs, their prospective lenders and the retailer.
Surround yourself with people you can be really honest with to run scenarios ahead of your investor meetings.
—Nicole Centeno, CEO and founder, Splendid Spoon
“After a conversation with the buyers, the retailer forwarded purchase orders for 300+ stores at least two months before the launch," she says. "We further negotiated a smaller launch and a month later, which gave us time to present the timely opportunity to the banks."
Diaz got her business loans. In addition to an uptick in sales to fuel her company's growth strategy, Bittylabs was also able to fund a pilot clinical trial for their product, which led to a viral video with over 29 million online views and another uptick in sales.
3. They focused on metrics.
When Ximena Hartsock launched Phone2Action in 2012, it was difficult to get investors to see the market for her product—advocacy software that enables organizations to create grassroots marketing campaigns to influence public policy—and how it would generate revenue.
“The adoption to smartphones was still low and Phone2Action sounded way too much like an app, not the suite of tools that it is," says Hartsock.
She had to figure out a different way to access investors to fuel the company's growth and quickly realized that metrics would be the key to accessing much-needed funding.
“For a SaaS [software as a service] business such as ours, metrics such as gross retention are critical," says Hartsock.
Prospective investors also wanted to see data on ARR (annual recurring revenue) and MRR (monthly recurring revenue). By focusing on metrics and critical business decisions that would show a trend of growth through those metrics, Hartsock was able to secure two rounds of venture funding totaling over $5.2 million.
"You need to be able to have detailed conversations about your finances, your capitalization table and your metrics for growth [with prospective investors]," she says.
This means waiting until you have actual customers to fundraise. Hartsock was able to show both the market for Phone2Action and its ability to generate revenue with ease. All it took was a mindset shift to help her think like an investor and what they would want to see before investing in her company.
4. They focused on delegating.
You've probably seen their ads on social media, yet before Splendid Spoon had social capital, they needed to raise money.
Nicole Centeno, CEO and founder of the company that delivers plant-based meals, had done pretty well on her own. She directed a team of six to the point where they were bringing in over $1 million in monthly revenue.
She soon realized, however, that to reach the next stage of the company's growth strategy, Splendid Spoon would have to raise capital.
“It's easy for us to get lumped in the crowded meal delivery and meal kit space," Centeno says. "One of my biggest challenges was convincing investors to see the larger picture—we are disrupting the weight-loss space by creating ready-to-eat, nutritious meals and practices that help people abandon dieting and embrace true habit formation."
She knew she was the one to convey this message to investors. This meant freeing up her calendar from the deeply involved day-to-day of building her company and instead, shifting her focus exclusively to fundraising. She had to find a way to delegate.
Centeno took a three-step approach.
“I highlighted for removal all internal meetings except those related to overall business strategy, our weekly team meeting and my weekly COO meeting," she says.
“I reviewed each meeting with the head of that functional group to define what my role had been in that meeting, and then delegated it to someone else," Centeno says. "This has the great effect of also refining how that group will operate daily without my input."
“I communicated to the team exactly what I will respond to, what I will not respond to and how to define items where my input was both necessary and urgent."
Centeno's efforts paid off and she found the capital her company needed for its next growth stage.
“Most notably, we have doubled our headcount and have a team with strong direct-to-consumer and operational backgrounds," she says. “We have also doubled YOY [year-over-year] revenue, increased customer retention and decreased our acquisition costs."
Now, as your company looks to accelerate its growth strategy through raising capital or debt vehicles like business loans for women, Centeno has a final piece of advice for women out there in the fundraising game: leverage other women.
“Surround yourself with people you can be really honest with to run scenarios ahead of your investor meetings," she advises. "It is especially helpful if you have a network of women to run those scenarios with—women are particularly perceptive and will give you more details about reading a room and understanding communication strategies."
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