I'm Raising £1,000,000+ To Scale To The Moon in 2023 - Documenting the journey - Episode 25

Yo, what's going on? Back with episode 25. Can't believe I'm saying that. Of documenting the journey. And in classic documenting the journey fashion, I feel like I've got nothing fucking interesting to say, but I'm recording anyway. And for once I actually feel like this might be a relatively quick episode because I've got so much shit to do. It's like Black Friday week next week. I feel like I'm behind on absolutely everything. My inbox is crawling with unread emails and yeah, this is my standard work from home outfit. Pretty much a fucking over worn hoodie and a hat that's probably sweaty from the gym 10 minutes ago, which is. But that said, episode 25, what's going on? I haven't written anything down this time for once I'm just gonna like fully ramble for like five to 10 minutes and see where we go. We're just over seven months since I started the brand, since I launched the brand and yeah, it's kind of mad. It feels like it's a proper business now. There's obviously a lot going on. The run rate is massively increasing. Like my biggest problem right now is I can't get enough stock. To be honest, I feel like I could literally do like realistically do 2.5 to 3x the revenue we're going to be able to do this month in November and we're only going to be able to do a bit more than October because I don't have enough stock, which is super annoying. But it's obviously part of scaling a brand and it's obviously easy to say I could do more but I can't because I don't have the stock. But it's so frustrating. Having said that, big restock next month. Dream does come in next month in December. So December is definitely going to be quite a bit bigger than November, which is good. And then, well, that's the plan and I think it will be. And then January, obviously huge for like health and wellness. So I think that should be even bigger. Again, like I said a few episodes ago, pretty much pivoted all the market into subscription focused stuff. So our subscribers are growing like net new subscribers every day is like piling. So we've had more subscribers in the past 30 days than we had in the previous six months pretty much. So that is looking pretty healthy. What else is going on? I've really decided that once Dream Dust drops, I think sticking to two SKUs, like literally Rainbow Dust, Dream Dust, and then our accessory products which are just like the mugs and shit. Then a few new accessories I've got. I reckon I can scale that alone to like 10 million plus just in the UK. And then the biggest opportunity to scale up on that, I think is localizing in Europe, because basically everything we ship outside the UK right now is fucked. You get stuck at Customs. Like, not helped by Brexit, probably not help by the fact it's a mushroom product. We can localize fulfillment. And I've been looking at doing that with my fulfillment center. But I then found out that because of the type of product it is, being a consumable and having to hold stock in the Netherlands, I would have to effectively make a new SKU because it would be entirely new packaging would have to have Dutch ingredients on it. All this shit. And that is just not worth the hassle. So I'm looking at like a workaround about getting their warehouse in Northern Ireland, which essentially would bypass that problem. So that's on the list. That's a major thing. I'm looking at another major thing that's going on and I feel like this is happening quicker than I thought it was going to happen or could even happen or potentially needed to happen. Is looking at doing like a really chunky round of funding because probably by like January time, maybe February. And it's an interesting one because once you get into the whole fundraising world and looking at businesses from that perspective, like, how can I raise the enterprise value and what it's valued at on paper, and what it would be valued at if someone was to actually acquire it in the future or raise money to a point where I could take money off the table, et cetera, it changes how you look at the business. Rather than just looking at a P and L, which I'd have done in the past, typically. But because it's a subscription brand, because I think it is very relevant and fitting to the whole private Equity Venture Capital D2C realm, because it's subscription, because it's a hot new market, because it's growing really quick, because I think it's a solid brand. Because it's limited competition in the UK right now, it does lend itself to being a good opportunity for the right people or fund to invest in. And because of that, I've had a lot of interest from, like, private equity firms that have approached me over the past few months, which is always a better position to be in, I guess. And I've had conversations with them, then had a few more recently, and then I've started just speaking to my current investors now. Like my mentors and saying, well, actually if we could raise a million quid plus say, which I think is what we're going to try and do at a very fat valuation, which I didn't think we'd be able to do at this point, but from the conversations I'm having, I think we can. I think that's actually realistic. If even in this market, which is arguably quite shit, then I think it can make sense to do. Because it's a fine line between like raising more money, diluting myself and obviously your shareholders, and increasing the valuation on paper of the business and then also trying to bootstrap it a bit more leverage, you know, debt where necessary, like Wayflyer, Amex, whatever, to try and grow. Because obviously more capital helps a business that's proven a concept to grow much quicker. Like, you know, hypothetically, if you had unlimited money, how quick could you get to 100 mil run rate? Probably quite quick. You wouldn't necessarily be profitable and it might not make sense financially, but how quick could you. And that kind of illustrates the point. Obviously more capital definitely does move things quicker. For me, the main thing I'd do with more capital would be simply probably buy more stock right now and spend more on ads, like literally as simple as that, and just acquire more subscribers. And now we've got decent amount of data, 7 months worth. We know that it's working, we know what's working, we know what to double down on. And it's literally case of just putting more, more gas on the fire, so to speak. So, yeah, I'm like weighing up options. If I could raise a million quid at the valuation I want, which is pretty hefty given it's seven fucking months old, then that would be solid and that would, I think, enable me to really throttle into 2023. So I've got a specific goal for 2023, which would be the full, the first full year calendar year, which lines up with the, the business year as well, because we did year end at December 31st, first year being eight and a half months. Pretty much. Eight and a half, yeah, eight and a half months. Obviously next year being a four year old. So that's what I'm looking at doing. Yeah, I know a lot of people signed up to like the pitch deck on Sea Legals. I just haven't, I just haven't decided whether I want to share all that with like everyone yet or just like select few. And right now it's more of a select few, like private equity funds that have approached me Ones I've been intro to existing shareholders obviously and then a bunch of other angels that I'm just aware of in my network and shit. But yeah, that is what I think is going to happen now. Looking to raise at least a million quid X valuation with the plan that if I can then use that money to get where I want to be by the end of 20, end of 20, 23, we'd go and do a much bigger fundraise. Say like 3 to 5 million quid would be fairly typical at that sort of revenue level that I'm targeting at the end of next year. And then you know, that'd be enough money to really put really fucking pedal to the metal I suppose and take it to like 30 mil rev plus. Obviously this is pretty hypothetical at this point, but like baked into the financial models I've had since day one, which obviously now a lot more tangible, that is pretty much the plan. So yeah, obviously fundraising is a fucking full time job in itself in a way. And I'm definitely not like fully focused on it, but it's something I'm looking at on the side. Having conversations with, had like three calls this week with PE funds, which I learned a lot from just having the conversations because you hear about the sort of deals they're doing, you know, get indicative numbers about similar brands. Obviously no details disclosed, but it's just interesting to have these conversations and see what they're looking for as well. Because ultimately part of the process in building something that is positioned for an exit is in my case, raising money along the way. Maybe taking some money off the table along the way. Granted not at this point, maybe like 18 months in beyond and then ultimately getting to a point where the business is valued at X amount and obviously raising money and the money being able to help you grow, but also raising money gives you credibility as a business because you've already gone through due diligence in that respect from angels, from funds, et cetera. So when you get to the point to sell, it's positioned in that category already. I mean, at least that's the way I'm reading about it. That's the way I see it, that's the way people are telling me about it. That's the advice I'm getting. So yeah, it's interesting. And I always get super fucking gas when I think, geez, like how quick could I actually make this really fucking massive? And for me it's like I want to get it past that million a month point asap because that's where that's where I've been before and then, and a bit beyond that. But like, how can I get this comfortably beyond that? And then I feel like I've unlocked like the next level of scale which I didn't quite get right in the past. And I'd be doing it with a better brand, a more sustainable business, but also as well, having learned the hard way, getting there in a sustainable fashion, you know, making sure customer service is solid. We don't go through a fucking PR disaster. Making sure financially things are solid and pretty bulletproof. So yeah, that's what's going on really. Black Friday's next Friday. We're doing like a full day offer. I haven't got enough stock to go mad with it, to be honest. I'm kind of not viewing it as that major of a deal. It's more just acquiring customers, but acquiring subscribers primarily because my offer is entirely subscription focused. Funnily enough, we'll see how that goes. And yeah, just, just managing stock. And then hopefully December and January and onwards will be bigger and bigger and bigger, but particularly December and January beyond November. So I said this would be a five minute episode. How long have I been speaking? There we go. 10 minutes already. But yeah, that's what's going on, I guess. Black Friday coming up. Can't get enough stock quick enough and things are growing well. So I'm looking at raising more money because the opportunity seems to be there even though I haven't been actively looking for it. So I think it's a strong position to be in. I'm not getting complacent with it. That's not necessarily going to happen. That's just what looks like a sensible move based on the conversations I'm having. And I'll keep you updated on that. But yeah, it's interesting how much can change in like six months from launching this thing. So it's cool. Obviously feeling the pressure as well. Cuz I feel like when you get, when you start getting momentum again, I don't want to fucking lose it. Especially because I've lost it in the past and it's so painful. So yeah, a lot going on podcast. Coming back soon as well. Decided just to get back on the fucking horse with that in a slightly different format. You'll see soon. And yeah, as always, space goes to the moon. I will see you in the next episode. Cheers, Fortune. Peace.