Episode Details

Welcome to Step by Step, a 5-part series from Future Commerce to help walk you through how to launch and grow a successful business. This season, we're talking about funding. Today is episode 5. Phillip & Brian are joined by Michelle Cordeiro Grant, Founder of Lively to chat about her experience working with Venture Capital from a founder's perspective.

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SHOW NOTES

Main Takeaways:

• Michelle Cordeiro Grant from Lively is back again to walk us through successfully selling your business.

• A strong operation foundation and consistent production costs can help identify where to apply raise capital.

• What are the factors that indicate that your brand is ready for an exit?

• Breaking through the noise of digital may require physical presence, so how can you achieve this with your brand?

Lively and Michelle: Some Quick Backstory:

• Lively is a brand and a community whose sole purpose is to inspire women to live passionately, purposefully, and confidently.

• Michelle grew up in a rural area of Pennsylvania and wanted to see what she could do with her life instead of more typically expected career choices.

• She eventually found her way into fashion and fell in love with the idea of concept-to-customer and the power of brand.

• Eventually, she wound up at Victoria's Secret that led her to decide that there was something missing in the lingerie community which ended up with the creation of Lively.

Pursuing Capital: A Founder's Perspective:

• With a story backward to most, Michelle left Victoria's secret with the idea that she could start a brand by having a community to build the brand instead of a company building it.

• She knew that she needed to have her supply chain completely under control so her strategy was to partner with an investor that was a manufacturer prior to launching her company.

• This allowed her to scale with what her customers wanted as opposed to what was written on a spreadsheet.

• Michelle did a $1.5 million convertible note with her manufacturer Gelmart and having the support and experience of a manufacturer in her industry set Lively up for success.

The Next Step: The Need for More Capital:

• Lively launched organically without paid media and after 45 days saw that they were able to ship to every state in the United States.

• Two months after launch, Lively had captured results that they had planned to do within the first year, which indicated that it was time to fundraise.

• Michelle's initial strategy was not to go after Venture Capital money, but rather to pool angel investors, but eventually started getting contact from Venture Capitalist firms.

• She wanted to wait for her Series A, but one email in particular from Robin Lee from GGV Capital (who worked for a VC but was also a Lively customer) changed her mind on VC and within a week of conversations, Michelle knew they had found their match.

The Struggles and The Victories: Accepting Venture Capital:

• Michelle was very worried about the expectations of her brand before she accepted the term sheet with Robin.

• In retail, a brand's growth charts like a roller coaster in regards to its trajectory and Michelle didn't want to be pressured for unrealistic growth.

• While