Transcript of Interview with Jennifer Love
Dan: Welcome to another episode of Shoulders of Titans. This is Dan Lok and today I have the privilege of bringing you a high power CEO, an investor, an entrepreneur with a big heart, my good friend Jennifer Love. Jennifer, welcome to the show!
Jennifer: Hey, thanks for having me Dan it’s great to be here.
Dan: So good to have you. Jennifer, maybe for our listeners, just tell us a little bit about your background and how you got into like business and what you do today.
Jennifer: Yeah, sure. Well Dan I am born and bred in my DNA entrepreneur. My father was an entrepreneur and I’ve been an entrepreneur my entire career. In fact I’m completely and probably unhirable as an employee because I’ve never ever worked for anybody else, I’ve only ever worked as an entrepreneur and owning my own business.
So I got started way back in the day as a kid and I started out with a cleaning service, cleaning homes for people in my church and had a lot of fun and took a lot of pride in it and I remember putting on the Beach Boys songs and like vacuuming away, thinking it was the best thing ever because I was making great money back in junior high and high school. Went on, worked my way through college – I worked full time actually I was a nanny and so you know I was taking care of some kids, kid service and loved it. And paid for school that way and you know one of the things I learned as a child watching and learning from my father who was an entrepreneur is that the work ethic; that you really just have to do what it takes.
You have to put in the time and the commitment and I think the other really important thing is taking pride in his team and he really valued the people – how important people were and I’ve carried that with me in my relationships, in my life and cherished them.
THE “RELATIONSHIP BOARD”
Jennifer: In fact, not many people know this about me – in fact I think I’ve only ever told one person about this – I have what I call my relationship board and it’s in an Excel spreadsheet because of course I’m the Excel spreadsheet queen as my partners all call me. But I track all my relationships; I have buckets, so I have my friends, my family, I’ve got my investor community and the entrepreneurs that I advise, you know and all these different buckets.
Those that I want to know and connect with or have loosely connected with, you know – my ladies, my gals, my girlfriends – all of this is tracked and so I keep it with their name, their birthdates, important days or important things happening in their life and then every day I look at it and I’ll reach out to a couple of the people and just touch base. And it’s a really great way for me to just make sure that I am connected to those that are important to me that I love in my life and those that I’m working to build a relationship with and by actually tracking it in such a way, I’m able to be very systematic in managing my relationships with those in my life and that’s been very effective.
Dan: That’s a fantastic strategy. So you have your Excel spreadsheet – I assume you have maybe different files or something like that, so you have your friends and family, you have people you want to reach out, you have your investment community, people kind of your clients, people you’re advising to and then so what kind of columns do you have? You have the name, you have the birthday, you have like maybe what they’re working on – like what else do you have on that sheet?
Jennifer: Yeah I keep it fairly loose. The name, obviously, any anniversaries or important things that they’re looking for; so I always ask someone like how can I support you? What do you need? And so I will plug that in as well as I come across things and will let them know and I can check that off and then it’s like, what’s up next that I can support them with? And then just general notes about what’s happening with them and things that I want to remember, things that are going on.
Dan: That is so awesome because I can see sometimes, even with myself – I used to make the mistake – you meet someone awesome and you’re like, yeah you know I’m meaning to kind of connect with them but somehow things, you know, too much to do, life gets in the way and then you kind of forget about them and in a few years you know – this is an awesome way of doing it.
Jennifer: I find it’s very, very helpful. It helps me keep on track and I think we have to be OK with managing and systemizing a lot of things in our life – it doesn’t mean it’s not personal because I think it’s the exact opposite; I think it’s absolutely personal that I put so much effort and time into the people that I care about. And they don’t even know that I do this.
Dan: And then they will be, oh yeah at least when you connect with them again, they know that you’re thinking about them.
Jennifer: Yeah, exactly. And it matters. Those little things matter to people.
Dan: And at the end of the day what I’ve also learned in business is that it’s truly – early in my career I thought it was all about getting the work done, performance, you know – we’re type A, right? But as I matured more I’ve learned that it’s all about relationships. That’s what gets deals done. OK so from there maybe tell us a little bit about maybe one of your most successful deals; a deal that you’re very proud of that you’ve done.
Jennifer: Oh well I go on about the one that happened this year, 2015. It’s not a secret that I love female entrepreneurs; everyone knows this because I am one myself, right? I embody it. But I have the privilege of working with 2 female trained industrial designers coming out of the Parsons School of Design for the last year and a half. When I met these ladies, they literally just had a prototype and the company’s name is Loliware. Loliware for those who don’t know, absolutely should, it is a cup that you can eat. It’s a biodegradable cup. It’s a cup that you can eat that’s meant to replace the one time use styrofoam or plastic cups. So you can imagine the implication here, right? This is a company that is really solving a real world problem and that’s key – I think you know everyone that is running a business or wanting to start a business, you know, one of the questions that they need to ask themselves is, what is the problem in the world or for my customer that I want to solve and that actually needs to be solved? Don’t solve questions that nobody is even asking.
And so for Loliware this is about waste reduction. This is a waste reduction company. Because if it hits the landfill or waterway, it’s going to break down and dissolve so when I met these 2 ladies, they literally just had this prototype and had really no business experience. I worked with them, we developed their sales strategy, we built out their financial model, we put their investment strategy together and we went out and shopped a deal. We launched sales in March of 2015 – now I won’t get into how much they’ve made – but let me just say, it’s been huge. And we opened up a series that was a $1.1 million round; we just wrapped that up a couple months ago and part of that was with Mark Cuban because these ladies went on to Shark Tank.
I had them fully prepared, we literally lined up an advisory team that took on a role of one of the sharks. I was Barbara Corcoran and plugged holes and really poked at them and made sure that they were prepared. I had prepared a 14 page document of questions and answers to make sure that they fully understood their business and that they could answer it with complete confidence.
And so those 2 walked onto the stage, I flew out to California with them – they walked out on that stage, were so prepared that they had 4 sharks fighting over them and walked away – this is what they went in asking for: they went in asking for $125,000 for 15% of their company. They walked out the door with $600,000 for 25% of their company. That so rarely happens on Shark Tank let alone in the world and so I’m so proud of them, I’m so happy for them, I’m so excited to be a part of this incredibly profound and socially impactful company. They are going on to do some great things.
Dan: And I have actually watched Shark Tank many, many times and I’m a big fan of the show and it’s interesting how you were talking about a 14 page document and how prepared they were. Because most entrepreneurs, sometimes, you can see that they’re just totally unprepared to be on that show. The sharks just eat them alive.
CONFIDENCE BUILDING TECHNIQUES
Jennifer: You know I think a lot of them are actually unprepared in a couple of ways. It’s like they’re walking out not knowing their numbers, not really understanding their strategy, but then they’re walking out on the stage without confidence. And I think that’s such a huge part of this and if it’s OK I’ll share a couple of strategies on walking out and landing that deal, using some confidence building techniques.
I remember one of the companies and entrepreneurs I was working with, you know I had worked with her for a couple of months and you know she knew her numbers, she knew her business strategy and she was delivering her pitch and practicing with me the night before that she was going to go in front of the investment group and she just wasn’t exuding it. It just was off, you know? And I looked at her and was like, what’s going on for you? Because you know this in and out and we just sat down and we talked and I gave her some strategies and confidence building things.
One of the things that I talked about was the ‘yes and’ – you know if you get poked at or someone’s poking at you in an investment meeting, ‘yes and’ them, you know? It’s like ‘yes, and here’s what we’re going to do.’ Yes and I like that idea, let’s explore that – you know it’s taking whatever you get and agreeing with it and flowing with it. And it becomes this beautiful tapestry and it demonstrates that you’re in control, that you’re confident but that you’re flexible and that you know what you’re talking about. So that becomes a really important strategy.
Another thing that I like to talk about is Amy Cuddy’s got this incredible Tedx talk that I just go on and on about. It talks about the power of pose and how she demonstrates in this talk that standing in a specific way actually chemically changes your body and because of those chemical changes, you feel better, you feel more confident and you are lifted up just because of the chemical change and therefore your confidence is taken to a whole other level.
So using something as simple as a power pose before you walk in. For two minutes, it’s two solid minutes, before you walk into an investor meeting – absolutely critical, you know taking action before the investor meeting, getting momentum going in your business. One of the other companies that I work with is another food company and you know they literally over the summer went from 0-100; I mean they had just a formulation of their product, it’s the first packaged smoothie bowl. I introduced them to operations teams; I help entrepreneurs you know build up their team and meet the right people and bring the right people to the table.
So I brought the operations person to the table, this operations made it all happen right before a trade show that happens in September every year called the Expo East – it’s the largest natural trade show in the world. We went to Expo East, before that we did a focus group – the focus group was informing you know how the product should be priced, what should it look like, x, y and z, right? Get all the consumers information, this is taking action, this is getting momentum. Get the consumers feedback. Then we went into this trade show and here’s what happened – there was so much interest because I brought so many people to the table, from Publix, Wegman’s, Whole Foods – all these major retailers who want to bring this product in and got pre-commitment from. Then, and by the way they were only at the show for 4 hours; they were at the pre-show, OK? So then they were nominated for what’s called a NEXTY award – this award is the prestigious award in the natural products industry.
They were nominated for this award before they even landed on the shelf; now let me tell you, if you can get that kind of momentum and take that kind of action before going in a meeting with an investor, that is powerful. Imagine sitting down and telling an investor – I’ve just been nominated for a NEXTY award, I have all these amazing accounts who want to sign me; I’m going to be able to, without any difficulty, do almost $3 million in revenue with only 9 accounts in the first year. Here’s how I’m going to do this. You know, that is powerful. And investors are going to look at you and say, whoa, this entrepreneur knows what they’re talking about, they know how to make it happen-
Dan: Something exciting is happening.
Jennifer: I want to invest in that! Yes. And kind of moving beyond that illustration is like, OK well you know let’s do the power pose, let’s do the ‘yes and’ when you’re standing and talking to them, let’s take some action before we actually get there – but another thing I like to remind entrepreneurs of is you know, lighten up. You know, this is fun and if it’s not fun why are you doing it? And visualize.
Do some visualization techniques or meditation so that you can actually feel lighter and more confident and happier even before you go into that meeting. I mean in the words of Arthur Ashe, ‘one important key to success is self confidence and an important key to self confidence is preparation.’ So that’s like really the next thing that I talk about in confidence building. If you’re fully prepared, if you know your numbers, if you know your strategy, it inherently makes you feel more confident.
Dan: Wow I love it. And as a speaker I can appreciate because you know we invest in people. So you could have a great idea, you could have a great product and you have a great business model but if we don’t connect and we see this entrepreneur well you know he or she is not so confident about what they’re saying – it’s not just what they’re saying but how they say it and I love it – basically getting into that state of mind before they even step on stage and say, hey you know what – instead of going please, please give me some money, it’s hey, here I am – I’ve got something great, do you want in? Right? You want to be a part of this.
Jennifer: That is absolutely 100% right and I think then you know the conversation becomes you know not only is the investor determining whether you’re the right fit for them but you get to decide from a place of confidence, from a place of strength whether they’re the right fit.
Dan: Yes, you’ve got to flip the table around. Awesome. Yes.
DEALING WITH INVESTORS
Jennifer: That’s right because not all investors are created equal and you need to get really clear. You know one of the things I say is, you know it’s like putting on the wrong shoe. You wouldn’t go out and run a marathon in the wrong sized shoes. Why? Because you’re probably going to get blisters, you’re probably going to end up bleeding, you may end up with some kind of fungus by the time you’re done running and that will land you in the hospital. Well you just simply wouldn’t do that! Why wouldn’t you do that? Because it’s just crazy.
Well the same thing is true – don’t put on the wrong investor. Don’t bring the wrong investor into your business. You’ve got to get really super clear about who they are, what they bring to the table and is their vision of how to run a company and what they want for the future and the exit strategy the same as yours? Because if it’s not, it’s going to be very painful. It’s going to feel like running a marathon with the wrong shoe on.
Dan: That makes a lot of sense. So just thinking about OK we need X amount of dollars to spend on business – what kind of partners do we want? Basically you’re saying we want someone not just bringing money to the table but maybe what kind of background they have, what kind of contacts they have, what kind of skills they have that could also add value to the company.
Jennifer: Yeah, I think there’s a couple things to really consider here – it’s about yes, how connected is this investor? But before you even get there I think you really have to assess your own skill set – you know what do you already have around you in terms of advisors, in terms of what you bring to the table. This is something I have all the entrepreneurs I work with do – get really clear about what your strengths are and what your blind spots are because then we can understand where we focus you and then how to fill in the gaps.
And once we know what gaps need to be filled, we can ask ourselves – is that fillable with someone from the outside, like an advisor? Or is that fillable from someone who needs to be hired? Or does that become a partner in some way? So once you have that kind of clarity, when you go and shop a deal and sit with investors, you can really hone in on well who is this person and what do they fill in where I’m missing? That’s a really, really important key. So it is about yes, how connected are they, but how connected are they specifically where you need them to be connected?
Dan: Yes, yes. And are they going to be an active investor or are they just going to be a passive investor like oh, I’ll just put in some money and see how it goes, right? You kind of want someone who’s kind of active. They have an invested interest in helping you succeed. That they want to see you succeed.
Jennifer: Well, again I think that depends on the skill set of the entrepreneur, you know? Everyone has different needs, everyone wants something different – do you want to have an investor that’s active or not? I mean I would, I would want a fairly active investor because if I’d gone through the exercise of getting clear about what my needs are and I’ve gone out and found someone who can help me fill that, yeah I want them to be there.
I want to talk this out with them, I want them to be an advisor to me as well. So I do want them to be fairly active. And then getting clarity about how to communicate together, right? Managing that relationship really well becomes extremely important. You know, how someone reaches out to me and how often you know entrepreneurs want to stay connected to me or expect me to connect with them is important to understand in very early stages and that needs to be in alignment as well. Is it every day, every week, every month or every quarter?
Dan: Yes, yes. Well speaking of which then what are some of the necessary skills or important skills that you think an entrepreneur should have?
SKILLS OF AN ENTREPRENEUR
Jennifer: Yeah, I mean that’s a really great question. You know, we as entrepreneurs, you’re either an entrepreneur or you’re not is my personal opinion. I do think that entrepreneurship can be learned but I think you’re either born with it or you’re not. And the fact is that the odds are against us. I mean about 90% of entrepreneurs are going to fail at their current venture and that’s really just statistics – so I think one of the things that I think really makes it and breaks it is perseverance because you’ve got to look at your failures not as failures but as learning opportunities and continue to get up even when you’re sitting in the mud because that sucked and you know that business just went down and get up and go again.
The most successful entrepreneurs in the world, including myself, have had failure. And you know you’ve got to just keep moving forward. So I think perseverance becomes a huge one. Again I think it’s about having the smartest people around you – you don’t have to be the smartest person; you don’t have to have a college degree, you don’t have to know it all but you do have to understand what you need to fill in and surround yourself with those folks who have the wisdom and the resources and the access that can get you to where you need to be. I think another thing for entrepreneurs is just being really, really clear that they know that it’s going to take longer and more money than they expect.
Dan: I love it. Murphy’s law – it costs twice as much and takes three times as long as you might think.
Jennifer: Right and the smart entrepreneurs and the great entrepreneurs I think you know they plan for you know here’s what I think it should take and then they double that. The contingency plan even as you’re raising money, right? Here’s what I think I’m going to need – add 20-30% to that because you’re going to need more. You just are. And I think another thing that makes an entrepreneur a great entrepreneur is that they’re curious. They’re almost like an investigator and they love to solve real problems.
It’s like Albert Einstein said, I love this quote, you know it’s the important thing is to not stop questioning, never lose the wholly curiosity, right? Constantly be learning and part of that is having an open mind to learn, and sometimes to unlearn – you know we have to unlearn things at times and I think another thing is to not take things for granted. Digging in, you know, digging under the surface and looking at what’s around you. That wholly curiosity kind of concept. Relentlessly asking questions – I think that’s a huge part. So many people are afraid to ask questions, I’ve never really understood this, thankfully to my mother she inbred this in me as a kid but never be afraid to ask a question; you know curiosity is important and asking the what, why, who and when and where and how will get you places that you never thought possible. And then I think another thing is just not ever labeling something as boring.
People label things as boring and that really shuts the door on so many possibilities. One of the podcasts out there that I think is really interesting and will probably be on the rise is taking the minutiae, the boring things in life and they’re digging in and examining it and then they’re talking about that and it’s a show and making it interesting and like from a place of curiosity, right? And once you’ve kind of dug in and explored it, I’m talking about this from a business perspective, digging into that becomes beautiful and it’s like, wow how can we do this better? How can we make this really mundane, boring process interesting and exciting and better for my business? That’s what will make you incredibly talented and a successful entrepreneur. And have fun, right? I mean at the end of the day again I always say this, like have fun! If we’re doing this and we’re not having joy in our life, it’s not worth it. And you know, reading. I think part of the learning process is constant reading.
Dan: Yes. I think also like what we do is we get paid to solve problems in the world and we’re having fun in the process, we’re meeting interesting people and what I notice a lot of entrepreneurs started off as oh, I want to make a certain amount of money – they’re money driven, including myself in the beginning I wanted to provide for my family – but after a while, once you’re comfortable and make pretty good money then it’s just a game that you’re enjoying the process, you get to meet interesting people, do interesting projects and that’s the fun of it. And it’s a byproduct if you do well, you deliver value in the marketplace then you make money. So, I totally agree with that. So Jennifer maybe talk to us, as an entrepreneur, when should we start looking for money? Because you talked about investment strategy like we should have that up front in the beginning? What’s your take?
Jennifer: Well I think it depends on what kind of business you are, you know? If you’re a service based business, it does become more difficult to get funded. I think the question about fundability is really around scalability. Are you a very scalable business and that means that it doesn’t require a lot of human capital, right? And that it can exponentially grow over time without having to add a lot of resources to it. And you know service based businesses typically don’t fit that because you know there’s a cap on how many hours per person, right? But there are ways to get around that, you know for example I’m running this new get funded now program.
I’ve been an advisor for many, many years and again I’m not inexpensive but you know there’s still a cap there, right? So I can put together a digital training program doing exactly what I do as an advisor and sharing that information and those resources with people but doing it through live training with access from a computer where hundreds or thousands of entrepreneurs can come in and get my advice and get the resources that I provide. That’s an example of making a service based business more scalable and that’s what I mean. But I think again for those who are looking and need money to scale their business, maybe the investment realm is not right for them right now, there are many other ways to go about this.
There’s the crowdfunding world which is growing by leaps and bounds, there’s the SPA way which again isn’t right for everyone but if you’ve got some assets in your business it’s a great opportunity to explore that and you know there’s the alternative lending as well. So there’s lots of ways that you can fund your business beyond investors.
Dan: And for investors, and I know some entrepreneurs might be confused by the term because sometimes they ask well Dan, what’s the difference between a venture capitalist or an angel investor – what’s the difference? When should I approach what? Maybe you can give us just maybe a crash course on that; different types of investors, how do they work?
Jennifer: Sure. So you know in the typical funding cycle – now there are exceptions to this rule – but typically, you know you’re going to start out by putting some kind of money into your business and then you may bring in you know some friends and family. And that’s actually one of the best strategies in the early stages is friends and family and I have some good tips that I’ll share in a moment about that. But, you know, go to friends and family, raise a small amount of money with them and then the next step is going to the angels and the angels are those who are going to share the vision and the passion of your business and being able to provide you with some great advice and some great resources and access to resources.
As you grow your business, you know and you’re starting to generate in the millions of dollars, now let’s say over a million up to ten million, that’s when you start to become attractive to the venture capital community. Again, there are exceptions to the rules, there are some venture capital groups that are focused on startup or early stage but that’s not typical. Typically, the venture capital community is looking for entrepreneurs and companies who’ve gotten a lot of traction which means you’re already getting a lot of revenue in the company and you’ve proven it out because it’s minimizing their risk and they’re looking to put in significant dollars into the company.
So millions of dollars into the company. So again you’re looking at yourself as putting those few hundred dollars into thousands and then your friends and family, maybe that’s you know a couple thousand to a couple hundred thousand and then to the angels who you know might be up to a million or a couple million and then you have the venture capital world beyond that. So that’s the typical kind of life cycle for the investment.
Dan: Jennifer, do you sometimes see entrepreneurs who may be at a point where they’re running out of money, running out of cash and they got like 30-60 days and then they talk to you and say, Jennifer we need some money or else we’ll be out of business? I guess that’s not a good time to raise capital.
Jennifer: It’s not, no – it happens a lot though. So I think you actually asked me the question, when should you be raising money? You should always be raising money. That’s my advice, you know – always be raising money even when you don’t need it and you don’t have to take it in but my point there is, this is the takeaway – build those relationships now.
Dan: That’s actually a very profound point, like you say – I want to make sure our listener gets that. We are always looking for investors; it doesn’t mean you have to take it but it’s always good – because from my experience it’s also good to get some feedback or they might know somebody like, oh that’s an interesting project you’re working on – you’re looking for X amount of dollars and I might know somebody that can help you. That’s so awesome.
Jennifer: Always be selling, always be courting investors. Always.
Dan: And that gives us an idea like is our business valuable, are we building value, are we building equity right? That’s so awesome. So we’re going to take a quick break and then when we come back I want to ask Jennifer about maybe what’s the best way to structure a deal and what equity we should give away as an entrepreneur, so we’ll take a break and we’ll be right back.
Welcome back. So Jennifer – as an entrepreneur should we give away? Because sometimes I see entrepreneurs, they may give away a bit too much equity early on because they think oh my company is doing a few hundred grand a year, it’s not worth that much – if you give me a little bit of money I’ll give you 40% of the company. What’s been your experience?
EQUITY – HOW MUCH IS TOO MUCH TO GIVE AWAY?
Jennifer: Oh this is such a great question, I get it all the time. Yeah there’s no hard fast rule for this. You know I think the important thing to do is to look around at what’s actually happening in your industry with similar type companies. You know, what are other companies that are like yours getting funded at? What multiple are they getting funded at and what’s happening with companies that are being acquired or merging into another company?
What are those buyout multiples? If you can understand that, then that’ll really help. It’s much like, if you think about real estate right? The same thing happens – you go out to the marketplace and you look at comparables. Well, you need to do the same thing when you’re shopping a deal with your company; you need to understand what the comparables are. And so you know once you have that comparable you can understand more closely, it’s very different for every industry.
So I can’t just say to you, hey Dan here’s how it should be structured because technology versus consumer products are very, very different multiples. You’re going to be looking at like 8-12% in a technology company versus the food company which is like 1.5-4% multiple. So, you know it varies and it also has to do with the strength of your team and the experience of your team and your advisory boards. Like I said earlier identifying your strengths and then what your blind spots are and then filling those gaps in – do that as soon as possible because with that, that actually becomes money and equity that stays in your business. That becomes a huge part in valuation. And then are you revenue or pre-revenue?
What kind of traction are you getting and how fast is that growth happening and then what are the hot buttons in the investment community right now? A great example of this – several years ago everything was about apps. Everyone wanted to invest in apps, right? And so what I would tell entrepreneurs during that time is figure out how to tie your business somehow into that hot button and you will find an easier time not only raising money but getting a better valuation.
Dan: So you’re talking about it’s almost like we’ve got to package our deal to make it appeal to investors. So it could be timing, it could be whatever’s happening that’s current could we tie into that, maybe whatever you’re selling you can pitch to an investor, oh we’re also doing an app that’s going to help us with distribution – whatever it might be, but it’s about packaging the deal. Not just, here’s what I have and here’s what I’m selling and hopefully you give me some money – we’re not talking about that, right?
Jennifer: That’s right. Again it goes back to preparation and confidence. It has everything to do with it. Yeah.
Dan: That is so awesome. And you know Jennifer when I was very young I read a book called Charlie and The Chocolate Factory – I know you’ve got a story. Jennifer and the chocolate brand as well. Maybe share with us that story because I think that’s a phenomenal story.
JENNIFER AND THE CHOCOLATE FACTORY
Jennifer: So Knitmore Chocolate is one of my babies and it’s still doing well today. Knitmore started back in 2009 and we were two co-founders who got into a commercial kitchen and started making chocolate because we went to a chocolate party and thought this is fun, this is cool, we want to do that but we want to do it better and make it healthier and put a healthy spin on it; so Knitmore is all about mindfully indulging and we were kind of crazy. I mean honestly I look back on it and think, were we insane?
Going into 2009 which was the middle of the recession and asking to sit our chocolate bar on a shelf with hundreds of other chocolate competitors? But you know sometimes never thinking that you can’t do something is absolutely the way to go get it done. When you don’t put obstacles in front of yourself, you can accomplish anything and we did. We decided that we were going to be a raw chocolate and raw chocolate simply means that we’re not heating the chocolate above 118 degrees and the theory behind that is that when you don’t heat it above that temperature is that you’re preserving all of the nutrients and the antioxidants that come naturally in chocolate.
So here we were, we had this amazing chocolate, it tasted good, we did it with agave which is a low glycemic sweetener which is also a fructose which everyone says is impossible to make happen in chocolate because it’s basically liquid and if anyone know anything about chocolate, water and chocolate don’t get along. And somehow we magically figured this out. So we broke science and we somehow landed ourselves on many shelves in NYC and started getting serious traction. And I remember at one point, this was about a year and a half in, we actually made the decision to stop sales altogether and that was one of the hardest days. I remember Dan sitting there going oh my goodness.
Dan: I can imagine. Like people buying it – people love it, like what do you mean stop sales?
Jennifer: I know like as a CEO and a person who was managing our sales and finances in the business I’m like really are we going to stop sales? But it was absolutely the right decision and here’s the important takeaway from this is that you can grow too fast. You can absolutely put yourself out of business by growing too fast. If you don’t have the operational support to support the sales, be smart. Slow down. And that’s what we did and thank goodness that we did.
So we made the decision to not bring on any new accounts, we only managed the accounts that we were already in and we continued to build those relationships and we figured out very, very fast how to scale our operation so we could produce enough to keep up with the sales that were happening. And that’s when we went out and raised money with friends and family.
Dan: I think as a CEO that’s a very responsible thing to do. Because I’ve seen companies where they just focus on growth and growth and growth and then suddenly happens like they can’t fulfill, their infrastructure can’t support the growth and actually that you know destroys the company.
Jennifer: Absolutely. Like think about this, if we have continued to sell and to add new accounts that we couldn’t fulfill the new accounts, let alone our existing accounts, we would’ve lost what we already had and lost what we had just gotten. We would’ve lost all the way around.
Dan: And the reputation too.
Jennifer: And the reputation would’ve gone out the door. So it was the right decision as hard as it was, what I call high class problems but yeah as you’re growing your business you’ve got to be really smart about it.
Dan: That is so awesome. So you exited from the company, but you’re still involved with the company today.
Jennifer: Absolutely. Yeah. I made the decision a year ago actually to bring in a new CEO and that’s always a really tough decision too as an entrepreneur to you know bring in someone else, to hand over the reins and put them in place but for me it was absolutely the right decision, it was the right decision for the company and this guy has gone on and he’s doing great things with Knitmore and he comes from a reputation in the industry and he knows candy and the world of chocolate very well and is going on to do great things with it so yes. Knitmore is my baby.
Dan: That’s so awesome. And your family loves the chocolate too.
Jennifer: Oh they would be extremely upset; I’m going on a plane tomorrow to visit them and if I didn’t bring chocolate, I would hear all about it.
Dan: You walk into the door, where’s the chocolate before we let you in.
Jennifer: Exactly. I have the order of who likes what, what flavor – I make sure I get it right so everyone’s happy.
Dan: That’s fantastic. It’s interesting because Jennifer your journey started early as you said from a cleaning lady and then to a CEO and then you exited and now you transitioned to more of an advisor and coach to female entrepreneurs. Share that with us, why don’t you go out there and start another company? Why now just becoming more of an investor and a coach? What’s your mission? What changed?
TURNING TO COACHING
Jennifer: I love being asked this question. Yeah, I’m all about building. I’m a natural teacher and I really believe that I can make the biggest impact in the world by supporting and lifting up other entrepreneurs who are doing great things. And that you have to have the financial savviness – you know I love listening to you talk Dan. Talking about money and that it’s the key to want to make money because it absolutely is, OK – and that you know entrepreneurs I want them to know how to make money because at the end of the day they can be financially free, they can be happy and they can all do amazing things in the world.
That’s how I make my biggest impact is by lifting all of them up and helping them get there; helping them have the resources, the tools, the access, the support – I’m their biggest fan, the cheerleader who’s there like cheering them on helping them make it happen and I do that with money, time, support and education as well.
Dan: And I think that’s also one of the reasons why we connect, because we have so much in common because I went through the same kind of journey. You build the company and make the money and now it’s not so much focusing on ourselves but I have the most fun when I hang around entrepreneurs and see them grow – it kind of nurtures and develop them and almost living through the whole experience again and again and again through different entrepreneurs – I mean I can imagine when your partners and students go on Shark Tank, you know it’s just as good as if you’re on Shark Tank. You’re so proud of them, what they’ve done, you’re so happy for them and not only you participate in their journey and share the wealth but it’s just so much fun. It’s so satisfying.
Jennifer: It is incredibly satisfying. I don’t think I could do anything else in life. This is what I’m meant to be doing and those that I work with, we have a lot of fun together doing it.
Dan: So what’s your goal now? I know you’re working now on a new program. Maybe talk to us a little bit about that because I think that’s very exciting.
Jennifer: Yes. Get funded now it’s a ten week course and it walks an entrepreneur who is looking to raise money through everything that they need to do to make that happen. And of course being an entrepreneur and investor myself, I have you know the insights from both sides of the street and I’ve brought incredible experts into the program from attorneys, CFOs, CPAs, investors, highly successfully funded entrepreneurs – you know all to be a part of this program so that they can literally figure out what their strategy is, how to put their pitch pack together, what valuation should it be, all the questions that they’re going to get asked and make sure they’re prepared for it, how to shop the deal, how to close it and how to go on to build great relationships and run their company well. So that is what this program sets the stage for and I’m very excited. I’ve got my first class running right now and I’ll be running it again two times next year.
Dan: That’s awesome. So for our listener, if you’re looking to raise capital – sometimes I’m amazed at entrepreneurs, they’re like oh well I’ll just go pitch in front of a group of investors, totally unprepared, their business plan sucks and they’re just going to wing it and see what happens. And I’m like, dude, this is like a once in a lifetime opportunity. This is probably one of the most important things you can do for your business. Why the heck would you not take some time to learn and get yourself educated? And learn how to do this properly.
Jennifer: Well here’s the reality Dan. If you don’t first invest in yourself, how can you expect someone else to invest in you?
Dan: Yeah, it’s like it’s crazy like I’m going to go ask for a million dollars. And I ask them, have you even read a book on how to raise capital? No. But I’m just going to do it because I believe in my product, it’s insane. It’s just insane. So with entrepreneurs who have got this program which is great but besides this program what’s your plan for – because I know you have a passion for supporting female entrepreneurs with a lot of my companies and partners are female entrepreneurs – I love working with female entrepreneurs; in fact I think I prefer working with women than men, myself. And I can say on this podcast because it’s always the men that get me trouble. I don’t know what it is. An ego thing, I don’t know what it is but I love working with my female partners. So, you have a passion there – are you going to do other programs in the future to support them? What’s your plan?
NEW PROGRAMS IN THE WORKS
Jennifer: Yes, beyond Get Funded Now – I will be putting up a crowdfunding, how to really set up those successful crowdfunding campaigns as well as alternative lending program; I’ll have a pitch deck program. So many programs all around how to fund your business and the various ways and then I’m going to be putting together a platform on really how to manage your business finances as well. Because that’s the other really important key, right? We as investors understand that deal flow, you know, is important – getting good deal flow and making sure these entrepreneurs are prepared but then it’s like once they’ve got our money, we want to make sure that that money is going to good work and that these entrepreneurs are managing the business very well and so it’s really about putting that platform together so that the education continues on so that they know how to do that well.
Dan: So once we do get the funding and capital we need, as an entrepreneur how do we wisely utilize that capital. Perfect. So, Jennifer I’m curious to see that from an entrepreneur point of view, from an investor point of view, how do you look at an idea or business, someone comes up to you and says, hey Jennifer I’m thinking of doing this, I’m thinking of marketing or producing this product in the marketplace, what do you look for? How do you know if it’s a good idea or not?
HOW TO KNOW IF AN IDEA IS GOOD OR NOT
Jennifer: I always do a little bit of research to understand but the first thing I ask them is why? I want to first understand why they’re doing this and dig into their story and what they know. So anyone that comes to me, if they don’t understand why they’re doing it or the basis for how they think this is going to win, then you know I tell them good luck and go back and figure that part out. But if they have a compelling story and if they’ve got some really sound reasoning behind it, then I go and I do my own research and I like really innovative things. I like things that are solving real world problems like waste reduction, you know things that are going to make an impact globally, so that’s what I’m really looking for. So niche things that are solving problems that are helping the world.
Dan: Do you sometimes see entrepreneurs that they have this idea – because sometimes they come to me as well and they say I’ve got this great idea and I’m passionate about it but it’s just an idea and doesn’t solve problems for anyone – it’s just oh I thought it would be a good thing to do. What do you say to those entrepreneurs?
Jennifer: Well the first thing I’m asking them is what is the problem that this is solving? You know, what does the consumer need from you with this, like how are you helping them? Why is this different? You’re either solving a problem or you’re leveraging and maximizing on an opportunity; so where do you fit into that? And if you aren’t clear on that then you’ve got to go back to the drawing board and get clear on that. So if someone comes to me with just an idea, that’s cool, that’s great but let’s make sure that you’re clear about what this is actually solving because like why even waste the dollars on going and getting it patented, even if you don’t want to be an entrepreneur, you just want to be an inventor, you know – you’ve still got to be clear on that. Because we can go license something, you don’t have to be an entrepreneur, you don’t have to – you can have great ideas, but again if it’s not solving a problem or maximizing on an opportunity and making something really a lot better for people, then it’s not really ever going to become anything.
Dan: And you know before we go – I want to ask you a couple questions regarding how you manage your time because I know you’re involved with a lot of different projects, you’re an advisor to many different companies – what’s your day to day like and how do you manage your energy and manage your focus and time?
Jennifer: A lot of green smoothies and green juice.
Dan: And some chocolate!
Jennifer: Lots of chocolate. You know redesigning your life is critical for entrepreneurs; I think getting plenty of sleep, I think getting up early in the morning and doing some kind of exercise – that’s critical for me. Meditation, I love to do a bit of meditation or breathing exercises that really help me focus and relax. And then structuring my day. So I actually have days of the week that I will do certain things.
So, Fridays are my finance days. Every Friday morning I’m looking at my finances, I’m reviewing my budget and looking at goals and you know kind of where we are for the week, month, quarter, year. So Fridays become my quiet day where I check in on how everything is going. You know Mondays and Wednesdays I take office hours. Tuesdays and Thursdays I’m out in meetings. So I really structure the days of the week for how I operate within my business.
Dan: So Friday is kind of thinking and looking – so when you have companies you work with, do you do weekly calls or do you meet with them once a month? What’s that like?
Jennifer: Yeah it depends on the entrepreneur and the arrangement but I like to do it once a week if possible so it’s typically going to be once a week or twice a month. And that’s going to be the more effective. I mean for some, like Loliware, I was working with them every day.
Dan: I have to ask – so Mark Cuban at the end he invested, right? So what’s it like working with Mark’s team?
WORKING WITH MARK CUBAN
Jennifer: They are actually incredible people. They’re really good people – I like them a lot, I can give them a big thumbs up. They are very resourceful and very connected and work hard to support the entrepreneurs that they’re working with.
Dan: That’s awesome. Because I watch Shark Tank and Mark is one of my favorites of course; he’s so different from everybody else.
Jennifer: He’s a good guy. I have to say – I know you know with all of his drama around the sports arena but he’s a really great guy – I like him a lot.
Dan: He also understands; he’s the king of PR right? So he knows what attracts the media’s attention and captivates the public’s attention, right? That’s awesome. So working with the team is good and from there the company is growing. Maybe before we go, share with us one of the failures that you’ve had if you don’t mind because I think that would inspire; because you know oh Jennifer it’s easy for you to say, right? But like of course we’ve all had a lot of failures but what’s one that it’s memorable for you but also you learned tremendously from it and other entrepreneurs can benefit from?
LESSONS IN FAILURE
Jennifer: Yeah. I’m going to get real real right now Dan, you ready for this? I actually had a falling out with a business partner. My business partner from Nibmor and it broke my heart; I think it broke hers too and it was very, very tough and you know partnership is hard. Business becomes so personal for us entrepreneurs and in fact I laugh when you know Kevin O’Leary says, this is just business it’s not personal – I’m like, yeah Kevin have you gotten that far away from being an entrepreneur?
Because it’s extremely personal for us who are starting this and we’re sacrificing so much and we have everything on the line – that’s everything personal and so when things like fall outs with partners happen, it’s really hard. And that felt like a big failure to me. And that was one of the biggest and one that has taken some time to recover from – but interestingly enough, we are actually in conversation in working to put closure and healing to that relationship. That’s really good.
Dan: So what do you think is the lesson from that? Like nothing lasts forever?
Jennifer: I’m sure her lesson would be much different than my lesson but my lesson from it was being able to set boundaries clearly and not sacrificing more than I was OK with. And you know I did – I allowed and enabled too many things to happen and I get to own my side of the street on that. So I think for entrepreneurs my recommendation is get really clear about what you’re willing and not willing to sacrifice in your business and in your relationships with your partners and you know set boundaries early, right away. I think that becomes extremely important in all of your relationships but especially in business.
Dan: Would you also say it’s about communicating the expectations? Like what to expect from each other?
Jennifer: For sure. Absolutely.
Dan: It’s funny because when entrepreneurs partner up and everything’s going great, it’s OK we have this idea, we want to change the world, we want to go and do something right? And sometimes when the money is good it’s a problem because one party gets greedy and then running out of money is also a problem. And so that’s with partnership and that’s people. If you could travel back, let’s say to one of your early days and maybe have a 10 minute conversation with your former self, let’s say a young, young Jennifer – what would you say to yourself?
WHAT WOULD YOU SAY TO A YOUNG JENNIFER?
Jennifer: Surround myself with key advisors. That is going to be the biggest, most important thing that I could do for myself and my career. And I learned that later in my career than I would’ve liked. So if I could go back and tell myself you know what to do sooner and faster, that would be it. Absolutely. Hands down.
Dan: Fantastic. Jennifer, how can someone learn if they want to get in touch with you or to learn more about your program – what’s the best way for them to do that?
Jennifer: Well I hope everyone comes over and says hello at JenniferLove.com – there’s lots of fun things going on over there.
Dan: And I know you’re in the process of launching a new site as well.
Jennifer: I am. It’s entrepreneurist.com and that is where all of the education programs will be hosted and all of our products and information about finding funding and finding investors – that’s where it all is – very soon. Probably the end of January that will come live.
Dan: Awesome. Any last words of advice for entrepreneurs?
Jennifer: You know, I think it’s just don’t be afraid to go get shit done you know – just stand up, try, when you fall get back up and keep going. It’s a long journey, you know it’s not about the sprint. This is a large race, be in it for the long haul, do your work, be smart, surround yourself with smart people and just keep getting back up and doing it again and learning. And you’ll get there.
Dan: Love it, love it. And I’m going to start implementing the relationship bucket – the Excel spreadsheet; I’ll be the king of Excel spreadsheets as well. It’s so awesome. Love the idea. So Jennifer thank you so much, it’s been a lot of fun – thank you for inspiring us today with your just amazing story and thank you for sharing your ideas and your story with us. I appreciate it.
Jennifer: So much fun, thanks Dan.