Latest / Imagine If with Doone Roisin | Health, Wealth & Wisdom for Women (formerly Female Startup Club Podcast) / GEMS: Cashflow, Bootstrapping & Scrappy Beginnings with ROSEN Skincare founder Jamika Rose
Transcript
- 0:09A lot of beauty brands that I've spoken to so far have gone down that VC money route. And from what I could see online, you haven't done that to date. How are you managing the hurdle that most seem to bump into when it comes to MOQs, large MOQs, scaling into retailers and that kind of the cash flow element?
- 0:28Yeah. So we haven't taken any equity or raise money or anything in that sense. We have done some stuff, I will say, with like ClearBank, PayPal, Working Capital, you know, a lot of online only kind of like loan or online.
- 0:44I guess line of credit would be maybe a better term, which are super easy, super straightforward. You just like sync your Shopify and they're like, cool, you make this much, you're eligible for this much. I will say as we grow, we have more access to other capital. It's not like the best thing. Definitely hurts the cash a little bit more as opposed to like a more traditional form of debt. So those are some things that have come in. And then I think also just understanding our cash a lot more.
- 1:08I really probably didn't understand our cash flow very well until like midway through last year. I got to a place where we were scaling and we were growing. And I was like, man, we're making like much more money. I think April, yeah, when COVID started, it was like, we immediately kind of like doubled our revenue from March to April. And I just remember like, it still feels, I was like, it still feels as tight every single week as it did in March, as it did in February.
- 1:37And it was like, we were consistently making more and more money. But it was like, I feel like I'm relying on how much I'm going to do in sales today, tomorrow, whatever, to make sure I can pay for stuff today and tomorrow. And so it was just like, not accurately understanding that cash flow. And so that was huge for me to really understand our cash flow a lot more to understand if I'm looking at the next three months, I should...
- 2:00pretty much know what the bank account was going to look like over the next three months. And that was something I just never had the foresight to do or really understand. So that was very crucial. I think I also could have probably done a lot more earlier on if I had understood that because I spent the first two, two and a half years of our business scaling, making more money, but still playing it pretty tight because I just didn't understand how to manage the cash flow properly. So I think with that, I think with some of these kind of like a little bit more accessible debt processes.
- 2:29platforms, we've been able to kind of swing it and make it happen. And, you know, as a bootstrap brand that came from a very small bootstrap, I was making, you know, I think our early credit card was like 1200 bucks. You know, if I had a couple hundred, you know, each month for my own, like babysitting money, I'd put it in, like come from very small, scrappy beginnings.
- 2:49I try to stretch my dollars as much as I can. And to the point earlier of like, I don't have the luxury of testing out, like let's test out these Facebook ads. And if they don't work, well, we learned that this didn't work or let's test out TikTok. And if it works, it goes crazy. But if it doesn't work, oh, well, it's like, I don't have that luxury because I'm just on a tighter rope of like, we got this much capital. And if I can't make this capital make money, then it's going to get hard. So it definitely is a much tighter rope to walk.
- 3:18It's been great for me to just really learn a lot about the business and be super scrappy. And also, of course, get to a point where like I have, if I do raise money, I have a better valuation or I have so much more experience because it's like, OK, like, look at the point we've grown to. I still have all the equity and there's a lot of great things in there. But looking forward and thinking about now.
- 3:41I think I've proven to myself or to others, if I do raise money of like, obviously, I know how to kind of like run and scale the business. Scaling to another level definitely is a different story and figuring out like where I fit in in that journey. But the pace of growth is really and I think ideally when you raise money, that's what a lot of folks want to kind of put money in.
- 4:00But yeah, I would say just kind of like some of those debt, like loan lending platforms. And again, the ones that were super accessible because I didn't know anything about finance. I had to go to a banker. I knew how to go to a bank, but like how to approach them, like try to get a loan and what I should prepare. Like I didn't know how to do any of that stuff. And so it was just as easy as obviously a click of a button with some of those other platforms like ClearBank or Shopify or whatever. And so I leaned on that and really understanding my cash flow. And I think that has really opened up a lot of opportunities for us.
- 4:30And it also sounds like having that mentality and being in that situation just forces you to be super lean and continually remain lean. And if you do raise money in the future, you'll be able to have that leanness, you know, to your approach.
- 4:45Yeah, you definitely are super lean, super scrappy and figuring out like you want to make your dollar stretch. And of course, it's definitely a mindset. There's a ton of founders who will raise money early on and still have that mindset. But if you launch and you have 2 million in the bank, you're probably a little bit more free than somebody who's like started with 50 in the bank and then eventually they raised 2 million. And it's just a different mindset. And I also just think there's so much to learn. Some people...
- 5:13are just like so well equipped and so experienced and all this stuff. But I think back to even if somebody gave me a hundred thousand in the first year that I ran it,
- 5:23I would have probably ran through that money. Like, I just didn't know what I was doing. And so it's like, just to have this now of like, I know what to do. Like, I know exactly what to do with this capital. And of course, I'm sure I'll look back on this in like five years and be like, I just know so much more. And I feel so much more confident in the decisions that I would make with capital. And the thought of, you know, somebody handing me over that much money early on scares me because there was a lot of me just like figuring stuff out. I think a lot of people take that path and some figure it out and some don't.
- 5:53Learning it on my own was definitely beneficial. And I am very grateful to have kind of done it that way. Absolutely. It sounds like it's been the right pathway for sure.
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