For episode 6 of MAKERS Money, Sallie's weekly show about women, money, and power, Luvvie Ajayi, popular blogger and author of the New York Times bestseller “I'm Judging You,” joins to talk about how to launch a new business idea like a boss, turning a layoff into an opportunity, and how being brave enough for uncomfortable conversations can change your life.
MAKERS Money is co-produced by MAKERS, the network of changemakers that spotlights the trailblazing women of today and tomorrow, and business and financial news platform Yahoo Finance. The six-episode season airs at 6PM EST on Thursdays on Yahoo Finance, MAKERS, and here at Ellevest. We’ll be archiving the episodes at Ellevest, too.
MAKERS Money, Episode 6: Get Into #BossMode
Sallie Krawcheck: Money is power. Ladies, it's time to level the playing field.
Hi everyone, welcome to MAKERS Money. I'm Sallie Krawcheck, CEO of Ellevest, the investing platform for women.
So, you've had a new business idea brewing for a while but you're not quite sure if it's time to make the leap to becoming an entrepreneur. “But Sallie, my career crystal ball is saying I'm not going to start my own business.”
Listen up; developing an entrepreneurial mindset will benefit you, no matter where your career takes you. Now, I get both sides of this equation, because I worked at big companies for more years, and I'm going to share with you, before starting Ellevest from dirt.
The 2 must-dos before starting a business
I hear from people all the time who want to start their own businesses, which I love because it can be so energizing, and interesting and exciting. But it can also be really challenging. Timing matters, team matters, luck matters. So, don't take the leap unless you have an idea you're passionate — and I mean passionate with a capital P — about.
Two things. Number one: Start a side hustle. It's smart to start exploring a passion this way because first, you're going to learn about whether your idea is any good and if you can actually make any money from it. Second, every new business idea needs some trial and error. Believe you me, you wouldn't believe what we went through in Ellevest. So, don't give your notice until you know your idea is ready by giving it a test drive.
The second thing I want you to do: Network, network, network. Network, network, and I know what you're thinking, network is fumbling for business cards and forced conversations, and 18 holes of golf and it's what the old white guys do. But it's truly the number-one unwritten rule of success in business. So make it a habit to reach out to one person every day. No big deal. It can be casual, and get together with one person outside of your company every week. Or, join a professional network. Make networking part of your success equation.
Turn a layoff into an opportunity
Joining us today is Luvvie Ajayi, entrepreneur and author of the New York Times bestseller, “I'm Judging You.” What a title.
Luvvie: You love it!
Luvvie, I love it! Thank you for being here and, cheers.
Luvvie: Thank you for having me.
Sallie: You know, we've got something in common.
Luvvie: What's that?
Sallie: It is the fact that we were both ... I think you say you were laid off. I was fired before we became entrepreneurs. So, you had what you thought was a writing hobby that turned it into a career. How do you advise people who want to do that to make that transition?
Luvvie: At that point, I'd been blogging for seven years. I was like, "Well, okay. I need to find a new job." But while I looked for a new job, I was doing marketing and consulting and kept blogging. And I never got a chance to get a new job.
Sallie: That's great, but didn't it really bring you down to get laid off?
Luvvie: No. I actually found a piece that I wrote on a blog the day that I got laid off that said, "It feels like the universe is pushing me to take the leap of faith I wasn't going to take myself."
Sallie: You know, it's funny you say that, because after I got fired, even the next day when I was drinking alone, by myself in my home, there was still part of me that said this is going to be the best thing that ever happened to me. I just don't know how yet.
Luvvie: Yeah, I think I knew that too. I fought it tooth and nail, because for me, writing wasn't a career that felt tangible — because you know, JK Rowling is a writer, and Toni Morrison. I was like, “I'm neither one of them.”
Luvvie: But I think after a couple years, when I was like, "Okay, you're finding yourself in rooms that outlets like the BBC and CNN are in, and here you are, as Awesomely Luvvie in the same room. You're a writer."
Sallie: Now, you've had some amazing experiences. You interviewed Oprah.
Sallie: Shonda Rhimes blurbed your freaking book.
Luvvie: You know, the OWN team called me and said, "Hey, we'd love for you to come and interview Oprah while holding an OWN mic on our lot." I was like, “What? How do you say no to that?" When Shonda Rhimes knew my book was coming out, she was like, "I need you to send it to me."
Have the courageous conversations
Sallie: And then, your TEDWomen talk went supernova almost immediately. It was "Get Comfortable Being Uncomfortable.” I think there you talked about “the first domino.” What does it mean to be the first domino?
Luvvie: I think it comes down to doing things that are uncomfortable and difficult. In the moment, that's difficult. So, when we're in rooms where somebody who's less powerful than us is being disrespected, for example. It is our job to actually speak up and say, “That's not okay.” So we need to disrupt power systems and conversations — and rooms — just to make sure that we are standing up for people who might not have the power to.
Sallie: Hear, hear. I call them “the courageous conversations.”
Luvvie: Come on.
Sallie: But hear, hear! We need a lot more of those.
Smartest (and stupidest) money moves
Sallie: Okay, we ask everybody these questions: What's the stupidest thing you've ever done with your money? What's the smartest thing you've ever done with your money?
Luvvie: The stupidest thing I've ever done with my money is kept it in a savings account.
Sallie: And so it loses — you lose money every day, essentially, right?
Sallie: Is it still in a savings account?
Sallie: Oh, good.
Luvvie: God, no. I can't come in front of you and be like, "Yeah, Sallie, I still have all my stuff sitting in a savings account." I'd be so ashamed. Okay? I'd be like, "No, I don't deserve to be here."
Sallie: So, what's the smartest thing you've done with your money? Take it out of a savings account?
Luvvie: Buying my first place.
Luvvie: In a growing area of Chicago.
Sallie: You live in it, and you love it, and you enjoy it. Thank you for being here with us. Such a pleasure.
Luvvie: You are amazing. I can’t say no to Sallie! I've got to be here.
“Why the eff don’t women get VC money?
Sallie: Okay, now let's get to some questions from all of you. Our first question asks, “I keep reading the news about how little venture capital funding women get. Why the eff is that? And, do you think it'll change?”
I mean, tell me about it. The bad news first: We women have gotten so little funding — just two and two and a half percent of the total — because of systemic bias. The venture capital firms are made up primarily of white men whose networks tend to be made up of white men, who thus listen to pitches from white men. Nothing against white men, I just hate it they get most of the money.
Now, let's be clear: It's not because men are better entrepreneurs than women. A study from First Round Capital showed that businesses with at least one woman cofounder performed 63% better than male-only. The good news is an increasing number of VCs get that investing in women entrepreneurs is a great opportunity.
“If I can’t dip into those VC dollars, how do I fund my business?”
Okay, here's our second question. Do you have any tips for funding my business without raising money from venture capitalists?
The truth, guys, is that only 1% of businesses are venture capital funded. Most businesses are funded with personal savings, loans from family, friends, and increasingly, and excitingly, crowdfunding. Here's the really interesting news: We women are consistently outperforming men on crowdfunding platforms like Kickstarter. Say that five times fast. Because we're better storytellers. Even better — not only can you raise money this way, but it can also be a really good way to test your product’s appeal and pick up early customers. In case you can't tell, I'm a huge fan.
“Should I get a cofounder?”
All right, third question. Should I get a cofounder, and if so, what qualities should I look for?
Yes, yes you should get a cofounder, because the research shows that startups with more than one founder are more likely — quite a bit more likely — to succeed. My advice here is to find someone who is as different from you as you possibly can. Here's why: You're not perfect. News flash: You're not perfect, and so, you're going to have blind spots. Having someone who thinks differently than you means you have a much better chance of avoiding a fatal flaw and seeing around corners.
Now, whether you decide to be your own boss or not, learning to think like an entrepreneur will pay dividends in the long run. Learning how to take calculated risks, standing your own worth and honing what you're good at, are key building blocks for long-term success. If you do decide to start your own business, do it with some money in the bank and go get ‘em.
We want to hear from you. Tweet to us at @MAKERSwomen and use the hashtag #makersmoney. Or send in your questions at Makers.com/makersmoney. Thanks to Luvvie Ajayi for joining us. She was amazing, and until next time, remember: More money, more power.
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