Entrepreneur Experience: Tracey Abbott, Big Dreams, Big Names
In this episode of our Entrepreneur Experience series, we sit down with serial entrepreneur and corporate executive Tracey Abbott, founder of Refuge Acupuncture and global business strategist. From being a corporate executive for huge brands, like Kodak, Foot Locker and PepsiCo, to her own ventures as a Chick-fil-A franchisee and owner of a wellness and Chinese medicine business, Tracey’s experience is vast and her knowledge of what it takes to build a successful business is filled with juicy nuggets to keep you on the right path. Join us on the global journey of Tracey’s background, what she’s working on now, and her advice for how to avoid risk.
Today we are talking to Tracey Abbott, experienced as both a serial entrepreneur and a big-name corporate executive, with a wealth of information and knowledge about business and operations and finance. From Kodak, to business school in Paris (in French, no less), to Foot Locker and Chick-fil-A, Tracey’s story is incredible and the wisdom and insight she offers is inspiring.
Cynthia and Tracey’s discussion dives into the inherent risks of being an entrepreneur, how to mitigate or understand your own tolerance for those risks, and how to find success in the face of it all. They also talk about the impacts of taking outside capital on a business and what different kinds of considerations come with different types of investors. Tracey shares her story about her first entrepreneurial venture as a Chick-fil-A franchisee and tells us how that shaped her plans for her second venture, Refuge Acupuncture.
This episode with Tracey will open the hopeful entrepreneurs’ eyes to the realities of striking out and offer insight, advice and wisdom that are second-to-none.
Be sure to like, share, and subscribe to Precursa: The Startup Journey on your favorite podcasting platform and tune in for the next episode!
Straight to you from Denver, Colorado. This is Precursa: The Startup Journey. We share the ins and outs of building a tech startup from inception to launch to revenue and beyond if you’ve ever wondered what building a startup from scratch really looks like you’re in the right place with full transparency and honesty. We reveal it all about Precursa on our ride from idea to exit the wins, the lessons learned and the unexpected twists and turns.
Hello everybody. And welcome back to Precursa The Startup Journey. Today we are doing another entrepreneur experience segment, and we are joined by miss Tracey Abbott, who is a serial entrepreneur in the CPG and retail space, as well as being a lead operator for a private equity firm. She is fabulous. She’s generous. She, she is wickedly smart and she’s especially smart when it comes to all things ops and strategy. So welcome to the show, Tracey.
Speaker 2 (01:09):
Hey, thanks. Thanks for having Cynthia
Speaker 1 (01:11):
<laugh>. So why don’t you start by telling us a little bit about yourself and a little bit about how you became an entrepreneur and sort of what that journeys look like?
Speaker 2 (01:18):
Sure. Well, my entrepreneur story really is both personal and on professionals. So I’ll start on the professional side and then it becomes personal. I started my career at Kodak. I was a photographer out of college and really, uh, loved that brand and went to, to spend about five years with them. And they sent me to Paris for my first shot at an international assignment for six months. I came back 10 years later and there’s a lot of story in there. <laugh> um, I then went, uh, from Kodak, uh, to business school actually in Paris, in French, from there to Adidas in Germany and Amsterdam from Addie to London, where I switched into consulting with at Carney and then got the all call to go to Dubai thousand six. And I wanted a front row seat to that complete, complete boom <laugh> and spent a few years there as well, changed a Bain company when I was working in Dubai and then Bain also sent me to, uh, Russia and finally South Africa.
Speaker 2 (02:19):
So a lot of international experience in my background. And then when Bain said, how about Brazil next? I said, how about home <laugh>? And so came back to the us in 2009 to the Southern, uh, region. And then I got a job with PepsiCo and started my New York journey from New York. I then led the target team out in Minneapolis for Pepsi, came back to New York to run foot law, strategic planning, uh, function. And at that point, you know, I had done sort of all of these big professional company names, right? And I’d always loved big companies, but I decided, you know, my next, my next opportunity, would’ve been a big, big, big P and L within, uh, within foot locker. And I decided I wanted to try something on my own, but I wanted to do it with training wheels on. So that’s a really good way to get into franchising.
Speaker 2 (03:09):
And I looked across many franchises and then decided to go with Chick-fil-A. And really I grew up, uh, in Alabama and met my husband when we were in nine when we were nine years old in fourth grade. So Chick-fil-A actually was part of our family’s, uh, just our, our family’s tradition and the operator there made sure that everybody was well fed, which was a big deal in, in our community. So I always had a really good image of what that, what that company could do. And I decided to go through the process, the process takes about nine, 10 steps. It takes anywhere from six months to three to four years to get an opportunity. Got the opportunity, went out to California to start a family business with my brother three months into that, through the fry shoot. He decided, uh, to tell me that he was leaving to go home.
Speaker 2 (03:58):
I thought he meant to his, he meant all the way back to Alabama, because it truly is the hardest thing I’ve ever done, uh, and that anyone can do is really work that front line of a restaurant. Yeah. And then, uh, from there I did two years after he left, I got that restaurant to where I wanted it to go and then was discovered by private equity where I sit now in my day job, but also in the middle of COVID decided that, you know, investing really was on fire in the last few years, trying to save companies, trying to invest in them. And I decided I wanted to make sure I was doing something that was good and well for the world. And in the middle of COVID, I started a, uh, uh, alternative medicine acupuncture clinic, and that is currently operating in, in low high Denver. So kind of interspersed in my career of big brands was, was, were these different entrepreneurial type of roles. And I am really an entrepreneur and through, uh, I really love it very much.
Speaker 1 (04:54):
So you went to, you got your MBA, you went to business school in French <affirmative> did you know French before you did that?
Speaker 2 (05:05):
I, I thought I did. <laugh> uh, I thought I did. And, uh, and so I, I passed the test well enough, but the issue is that written French and oral French when you’re being taught nine to nine or 10 hours a day in the language, uh, is really hard. And so we would take us all day long and we would record it like on one of those old, you know, video cams, cause it’s 2002 and then my French teacher, and I would go back over everything that I had missed all day. And I did that, uh, pretty routinely for about 10 months. And it was really hard. It’s one of the two things including Chick-fil-A that if I knew how hard it was gonna be going and I don’t think I’d have done it. Yeah. So the good thing is that life only gets you to see it forward instead of backwards. Yeah. Oh
Speaker 1 (05:44):
My gosh. I love that. So there’s, you know, Chick-fil-A is sort of infamous, right? Because of the difficulty of actually becoming an operator and you talked a little bit about that. Um, you know, if somebody was out there and was like, Hey, I wanna run a franchise, you know, is, is, is running a Chick-fil-A different? Is it the same? Like what, what would you tell people?
Speaker 2 (06:08):
Yeah, well, they’re very different things, right? So the, the Chick-fil-A model is a very low buy-in, so it’s $10,000 or was at the time it was $10,000 of investment, but you, you really, um, you know, they take 15% off the top, you split at the bottom of performance. And so it’s, it’s really, really a partnership and that’s actually how they get as much control as they have even being a hundred percent franchisee model, um, that, you know, we’re really all part of the family, if you will. And other franchises that you look at, you know, any that I can think of require, uh, the biggest difference is the requirement of capital and then the requirement of time. So Chick-fil-A operators are really supposed to be at the restaurant and I was there way too much. I was there you over a hundred hours a week, but you really are supposed to be the unofficial mayor of the town and, and really, you know, add to the social fabric of it.
Speaker 2 (07:00):
And there are other models and I sit on boards of other restaurants that are franchises as well. There are, you know, other models that, where you need, you know, a million dollars or, or so to put down on it and you need liquidity of, of more than that. And so, you know, generally franchises are pretty expensive to get into and then, but, but once you own one, then often the owner is quite absent. It’s just a, you know, it’s, it’s a financial investment rather than a, a human one. Um, so I think that right now with the world, the way it is and where the workforce not only is now, but where it will be in the, in the next 10 years, cause we’re not gonna get out of this very easily. I would, I would think that the model of being distant so much franchise is probably a fairly scary one. I think, I think being really close and proximate to, to what’s going on is gonna be really required, uh, because more and more we’re seeing that teams don’t just want, uh, cash, right. They want care and to provide care, you have to be there, be
Speaker 1 (07:54):
There. Yeah. So what would you say is the most important lesson that you you’ve learned as an entrepreneur and what advice would you give to other entrepreneurs?
Speaker 2 (08:04):
Okay. So my advice is based on my experience, but I’m not sure it applies to everyone. So I, I sort of came up through the mentality of apparel buying in some way, which, and, and how that, what I mean by that is that if you have a model that you’re trying to sell and you wanna decide how much, how much to make of it in order to sell it, you know, you, you have your projection and you would, you, you, what you wanna do is get to what the right level is as quickly as you can, because it’s inventory, you’re stacking up. If you get it wrong and you’re going out of stock and disappointing customers and losing sales, if you get it wrong. So the apparel model is really to, to shoot maybe a little bit to shoot high, um, and then, and then see where it lands and then quickly adjust to where that is.
Speaker 2 (08:50):
So that’s kind of, you know, how, I’ve, how I started. Chick-fil-A, it’s certainly how I started refuge acupuncture. Um, you know, refuge, I started with four rooms, uh, you know, a lot of capacity, 800 patient capacity a month, um, 10,000, almost a year and in COVID. Right. And so I built that capacity out, uh, at the beginning kind of like field of dreams. Like if you build it, they’ll come. And I did the same thing at Chick-fil-A as well. I, I bought all the things to make, you know, to, to make sure that that restaurant four years from then would be very successful. And I’ve learned really important lessons about cash flow through this <laugh>. Uh, so my advice, if I were doing this over for myself, my advice would be start small Teon that, you know, do, do the minimum things you can do at the beginning, figure out the business and then focus and then spend your money there. Um, I think I probably sort of sprayed and paid a little bit too much. Uh mm-hmm <affirmative> and I, I probably would, would would say, you know, focus is the number one, you know, the one number, one goal of, uh, of a startup in my opinion.
Speaker 1 (09:57):
Okay. Got it. And so if, if you had to pick a personality trait or a characteristic that someone needs to have to be a successful entrepreneur, what would you say that is and why?
Speaker 2 (10:07):
Uh, tenacity, because there is, uh, it’s lonely, it’s, it is lonely. Even, even when you know, other CEOs, even when you know your team really well. And look, there are days when just, I mean, it’s like every day is a day. It feels like 15 days when you’re an entrepreneur in one, right? And you, you really do ride. It’s very true that you ride the, the sort of up and down, and sometimes it’s really down and you feel like you’re complete, you know, you’re cash flow, like one paycheck away from failure completely. And then some days you have, you have good things that happen. And so, I mean, I’m in this stage right now where it’s hard, you know, I’m, I’m in I’m seven months in right now to a business that’s still, you’re still affected by COVID and still, you know, preaching alternative medicine in a largely pharmaceutical world. So there’s a lot of challenge and it, it is, you know, I went through what I thought all the strategic questions were to start with. I knew all the risks and challenges getting in. And so, you know, the tenacity to just keep going and trust the process and, you know, really understand what it takes to get something off the ground, the ground, and then keep going. Right. Yeah. It’s hard. I think that’s probably the, the characteristic is that I need the most
Speaker 1 (11:16):
Tenacity and you are very tenacious. That’s one of my favorite things about you <laugh> takes
Speaker 2 (11:22):
Tenacious, Tracy. Yeah,
Speaker 1 (11:23):
Exactly. So talk about risk a little bit, right? Because there’s, you know, you we’ve, we’ve mentioned COVID a couple times, obviously that’s top of mind for everyone. Maybe not as much as it was a year ago, but it’s certainly still present. And, you know, and a of the questions that I get from entrepreneurs are how can I reduce my risk as much as possible? What do you think about that? And what, what do you, what do you think are the right things to be doing to reduce that risk or to, to play a little less fast and loose? Like what, you know, what are things that you’ve done or things that, you know, you would tell other people are, are good, good rules of thumb on them.
Speaker 2 (12:02):
So for my business, it’s a, it’s a people business. Um, you know, we’re, we’re, and I’m not an acupuncturist. I am an acupuncture school, but so I, so my people are everything. If I don’t have my independent contractors doing what they do, refuge doesn’t exist because it’s just a really, really pretty building that we can sit in and swing and swings. So I think, I think that’s probably making sure that, um, I, I think people are always your biggest risk and always your, your biggest opportunity as well, because if they don’t show up, you don’t have a business. Yeah. And, and that was true at Chick-fil-A as well, even in a very different context. Um, you know, someone doesn’t show up for E for even one position, you know, it is a, it is a very tightly run operation. And so if you, if you miss a link out of that chain, um, it, it really puts a bunch of pressure on every other link in the chain.
Speaker 2 (12:50):
So I think about people as, uh, as risk and opportunity, um, risk, if risk on my part, if I don’t get the right people in my business and, you know, but such a benefit. And the only, the only thing a business is built on in my opinion is people. So, so I think those two things, I think that, um, you know, the risk of, of, you know, of course the risk of, of, of a pandemic is something that we can, could have never planned on. Right. Yeah. Right. But I think the, I think the risk of, of things like socially changing something happening, you know, where you’re in a business that either may, you know, that may be affected by social change and social uprising and, and the real things that we’re seeing in, in the country, you know, for example, right, as I was starting and thinking about thinking about refugee acupuncture were, which is a Chinese medical business stop, Asian hate happened and, and came, came up as a really big, a really big topic.
Speaker 2 (13:42):
So you also have you, the there’s these macro risks that, that you have to be really aware of and, and how to navigate through how to navigate through those, those storms. Some sometimes, you know, storms and teacups that you may not have created, but you have to deal with, you know, I, I think that, and I’m not talking about stop Asian hate for that, that that’s, that’s something that we support, uh, completely, but, but it is, I, I, you know, entrepreneurial friends who will stumble into to, you know, those types of those types of issues without even realizing yeah. Sometimes. So I think that’s, uh, a risk as well. And then I think there’s always the financial risk, which is, again, start small guys, you know, go, go, go small, and don’t take out loans and, you know, bootstrap yourself until you can figure out, you know, if you really wanna take investor money, cuz that’s a whole different level of, of pressure and risk that I decided not to take a beginning to us to lower my risk
Speaker 1 (14:37):
Profile. Yeah. I’m curious about that because you know, a lot of the, a lot of the episodes that we do and a lot of the questions that I get are related to, how can I get somebody to give me investment money? You know, how do I talk to investors? How do I pitch my company? It seems like a lot in the, in the startup world and you know, your private equity side of this, I’m sure that you see this as well. Everybody’s trying to figure out how to get somebody else’s money. And I am always a fan of let’s bootstrap as long as we can. I mean, in Precursa, we’ve, we’ve gone very slow with our fundraising effort, not intentionally in the beginning, but now we’ve become very intentional about being slow and steady with it. And I’m just curious, like, what is your perspective on the, the positives and the negatives of getting investment capital when is too early and, you know, maybe talk a little bit about how too early money and too high of an early Valu can actually create mega problems in a business too.
Speaker 2 (15:35):
Yeah. I mean, it’s, it all comes back to your desire, like what, what you want to control and what you want to be controlled by. Right. And I think that loosely said, I mean, money is money is both freedom and control. And so for me, I’m in a position where I, I had what I needed to do to start my company. I ha I knew what I was doing was a, a relatively small amount, uh, in the big scheme of things, a relatively small amount of, of, of money that I could use to try it. And I think that was, that was my route. Um, the, the, the downside to that is it’s my paycheck paying for everything I’m doing as an entrepreneur. So I, you know, so I do have this di dichotomy of being in, in the workforce and also an entrepreneur. I think, you know, money early on can really help if you have a very good vision and you have great investors, it can really help, uh, get, get, you know, get the business going faster.
Speaker 2 (16:31):
Um, because it is about speed to market in many ways. And, and a lot of times capital will help you with speed to market. Um, but it does come with a lot of strings. So it comes with, you know, it comes with the desire to, to, to get the money back, right. <laugh> at, at a, at a return that at a return that looks attractive to investors. And so I would say, you know, even within the world of invest, there’s so many different kinds of capital to take. And, and there’s what we call retail investors, which are people who don’t do it professionally. Um, taking retail investor money is probably the hardest. Um, just because, uh, I, I think the, the, the people who do it professionally understand that, that it takes time to get returns. Ah, it takes time to post performance, uh, et cetera. So you know, that I, and I, I, so I think it really depends on what, um, you know, what your business is, how sure you are of it, how much you want other people in it, and how early you wanna start getting opinions about what your vision is. You
Speaker 1 (17:29):
Know, that’s interesting because we talk a lot about friends and family and a lot of institutional investors will even ask you, you know, we’ve, we’ve heard that from, um, a couple of like venture firms that are doing early stage capital that we’re talking to, and they will say, you know, who were your friends and family investors? How much did you get through friends and family, but to your point about retail investors, which is really what friends and family investors are, they don’t do this for a living they don’t, and, and, and you find that the friends and family money tends to come with so much more handholding emotion yeah. In emotions. And so that’s, you know, does that, why is that so important to later stage investors and what should someone do if they’re not someone who has like rich friends and family or people who can invest in their company, like, you know, what, what kind of strategies, you know, you, you kept working. Yeah. So did, does that work? I mean, is it possible to be a success, a entrepreneur while you’re still working?
Speaker 2 (18:31):
It depends on the business entirely. I could’ve never, ever done a hands on business where I was the person providing the service, like at Chick-fil-A. I mean, I had to be there. Right. Whereas I’m not the person providing the service in, in my acupuncture clinic. And so it, my role there is strategy and vision, but how it gets executed is, is really by, by the, uh, the acupunc by the Chinese medical doctors. Right. Um, so, so it, it’s very different levels of involvement, um, you know, complete control, but, but, you know, accountability for accountability to the team as well. So, you know, I, I think in terms of FA friends and family money, a lot of people raise it. I’m in a lot of friends and families investments. Right. And I will say in my own experience, you know, investing in different friends and different ideas, it is a little bit hard when they’re not showing you the money, right.
Speaker 2 (19:25):
When they’re not, when, when the idea is not, is not successful. And it is, I think it’s hard to mix friends and money. I think it’s hard to mix family and money, which I have done unsuccessfully right. Uh, through Chick-fil-A. So, you know, I, I, I tend to, I tend to like incubators, I tend to like things that, um, you know, for the question, how do you, how do you do this? If you don’t, or aren’t sitting on, uh, investment money yourself. I thinking I’ve seen people go through incubators and come out great ideas, and then they get funded and then they’re off to the races. Uh, and so I think, I think sometimes that’s a good way. Um, we definitely, even in my hometown, in Birmingham, there’s, you know, a group of people who loosely are in, you know, they’re, they’re investing in small, small ways in, in small companies in the community. Um, and I think, you know, those types of groups exist, uh, that are loose, you know, that are, that are loose investors, I would say. And not necessarily, uh, professional investors. Yeah.
Speaker 1 (20:24):
Although some are as an entrepreneur, what keeps you up at night
Speaker 2 (20:29):
Cash? I mean, early state, it changes over time. Yeah. Cashflow in the beginning. Uh, so cause you just have enough to make it right. I’m looking at a big, looking at a big, a big fixed cost, not in my Rente. And, and that’s another, by the way, mistake, I would say, uh, just again, start small, uh, start small and expand because once you’re in a five year lease, you, you know, you’re in it. Uh, so, so I think, um, you know, starting small.
Speaker 1 (20:53):
Yeah. And one of something that you said, uh, and I don’t remember exactly what words you used, but it made me think, like you, you mentioned something about, especially with friends and family money, but with any investor, like, you know, they wanna return on their money. Right. And right. Is what would you say is the difference between a company being successful and eventually producing a return and not, I mean, is it, is it just, if you give up as a founder at some point, then that’s it, or are there really companies that are kind of like it’s doomed and you there’s, this is just never gonna work.
Speaker 2 (21:27):
Unfortunately, there are a lot of companies that are never gonna work and I’m not sure mine is yet. Right. So, I mean, it is, but it it’s, it depends on what your definition of work is <laugh> to.
Speaker 1 (21:39):
So how do you define success, Tracy? <laugh> right.
Speaker 2 (21:43):
I mean, success looks like, you know, success looks like breaking even my, um, no, but, but it it’s, uh, no, I, I think success is what, that’s, what I mean about investors. Like in, in a way, like I define what I think my success is today and my success is actually not a revenue number. It’s a number of patients served. Yeah. Um, because that’s what I’m really focused on. And, and that’s what, you know, will eventually bring, bring the return. But you know, when you take investors, you know, those are different KPIs, right? So they’re, they’re not looking at, I mean, they might be looking at number of patients, but it’s an IBI, a, you know, everything’s about top line, top line, if you’re early stage and then IBI a, if you are, if you are profitable and they wanna see that and they wanna see that trend over time, you can’t just hit those numbers.
Speaker 2 (22:28):
So you need to hit them, you know, you need to hit them consistently and, and grow. So the companies who do really well from early stage, that, that I’ve seen, you know, they, they kind of get the right, they get the right team, they have a good idea. That’s proven out they get the right team in place. And then they are very good at understanding what, where to take money from. So do they take equity? Do they debt? How do they decide to service that cap stack? Um, and, and then they, you know, so they have it sort of all, they have all, all the skills that you need. And then there’s a story of Sarah Blakely who had absolutely no business training at all, who, you know, no, no idea, um, kind of what she was doing and just a super tenacious saleswoman. And as we just saw you, you know, she just sold spans to Blackstone.
Speaker 2 (23:11):
So, you know, outside money for the first time ever in her 20 year career, which is a very interesting story to watch. It is possible to become a very successful CEO and founder, uh, without outside money and Chick-fil-A has done the same. Um, so family, family businesses can, can make it, uh, without outside money. But for sure, thinking about capital, whichever you take debt or equity, debt’s pretty cheap right now. It’s a pretty, you know, it’s not, not the worst thing to take that. Um, but it does help accelerate. So it’s always a question in my mind of speed, uh, which takes that funding or control, which may go slower. Mm-hmm <affirmative>, uh, but it’s yours in the end. And so I’ve clearly picked the second for the moment. Yeah.
Speaker 1 (23:56):
Yeah, no, I love that. Okay. I’m gonna tell you a statistic and then I want you to tell me what you think about it. Okay. Okay. Okay. 42% of startups fail because no one wants what they’re building,
Speaker 2 (24:10):
Right? Yep. And so that’s yeah. Product market fit is the number one. I think thing if you don’t have, and, and if you don’t really think about it, you know, you think you have a good idea. Yeah. And every entrepreneur is IM passionate about as, as passionate about there. I idea. I mean, I could talk about my idea until the cows come home, but the reality is, is, is there a, a demand in the market for it, I’m finding out maybe less than I thought, um, at least in this market. And so, you know, there, there, so the more you can get your product market fit to, to work. And so you really like are building a case where you believe, uh, and you can test out and you can, you can, you’ve got some idea of whether it’s going to work. I mean, it’s, it’s everything because so many, so many startups do fail and, you know, even with the best planning that I did, I’m, I’m, you know, I’m, I’m, I’m, it’s a, it’s a, it’s a push right now.
Speaker 2 (25:04):
Right. So I think, think that, um, I think, I think it’s people and just watch shark tank, right? Like I think people all the time have an idea that they’re really passionate about, and then they haven’t thought about, well, who’s going to buy that, that in the end, because I mean, I hate it, but it’s commercial, right. So if you know something, you can sell it to someone else. So who’s this someone else and what do they look like? And do they really need what you’re selling? And is there, are there 15 other things doing the same thing? And you just think you can make a better, one of those things, you know, that’s also really key understanding your competition and, and, you know, if there is no competition for something you’re either really a pioneer. Yeah. Or perhaps that’s not
Speaker 1 (25:46):
That. Yeah. Okay. That’s interesting. So when, so a lot of times when I work with entrepreneurs, you know, and we start talking about competitive analysis and you know, who else is out there in the market? And they say, oh, there’s nobody else. This is totally brand new. How often do truly brand new ideas really show up? And when they do, how often do they actually create a new market? Because it’s really a new idea you’re creating a new market. How often does that really happen?
Speaker 2 (26:14):
I mean, I’m kind of, of the belief that everything we’ve seen everything, right. It’s like the fashion industry we’ve seen everything that’s ever gonna be produced, has already been seen once. And, and you know, now it’s just about a matter of modification. I, I think, I think there are very, unless it’s tech and I think tech is something different, right? AI and you get into crypto. I mean, there’s a lot of industries that are very pioneering and you’re, you’re in more of those industries than I am. But in consumer goods in retail, look, we’ve seen this dance, right? Like there is little that’s going to be produced. That’s not seen now the question is how do you get it to market? So I think what is creative in my space is, you know, the direct con it has anything has to have a direct consumer, uh, you know, spin on it now, but then we’ve realized through COVID maybe not all direct consumer. I mean, so it’s, it’s, it’s a, it’s a mix of, of, uh, of, of all of, of those things, I think. Okay.
Speaker 1 (27:03):
That’s interesting, you’ve mentioned a couple times speed to market and sort of how, like capital and speed are kind of the two levers that you have to sort of manipulate and pull or, or whatever, when you’re, you’re working on something new, what what’s too fast. Is there such a thing as too fast?
Speaker 2 (27:24):
Absolutely. Um, there, there, there is. And in fact, like even in my corporate job at foot locker, I controlled 220 million of capital, which was largely, uh, about new store openings. And we actually, uh, each year got pushed by the board to spend, we were doing really, really well as foot locker. It’s an incredible story when I was there. And, uh, under the leadership of Ken Hicks, we had so much cash to be able to invest that the board really wanted us to open more stores and go faster and what really, what we didn’t. And we pushed back on that because a, we just, it takes, it takes, you know, manpower to do that. It takes the right deals to do that it in real estate, et cetera. And so we actually wanted to be very deliberate and had very controlled growth instead of just growth at any cost, because growth at any costs can be very dangerous.
Speaker 2 (28:15):
It also can fall very fast. So, you know, knowing what your organization’s capable of delivering, I think is really important. And if you’re just a, a solopreneur and you don’t have the organization yet, I, I, I mean, I still am doing that right at the beginning. Of course my mind, you know, it, the last, the next five years are planned out in my mind and I’m tweaking and I’m tweaking and tweaking as I go. Yeah. There’s just a lot in the first bit of time where you can still make, you can still make a lot of a impactful decision. So yeah.
Speaker 1 (28:46):
How is it different? So, so you have run really large companies with huge budgets, but you’ve also been an entrepreneur where you have to get real scrappy and how, how are the skills of someone in those two different roles, different? Because a lot of times I’ll see startups that say, oh, you know, we’re in this FinTech space. And we hired this former, you know, executive from, from visa or American express or PayPal. But that person, I, I, I feel like there’s this gap between knowing what to do when you have half a billion dollar marketing budget and knowing what to do when you have half a million dollars to build an entire company an entire startup. Right. And so I’m just curious, what is your experience with that gap? And, you know, do you have any advice for entrepreneurs who might be thinking, oh, I should go bring on this really experienced person in this industry who maybe hasn’t actually done the boots on the groundwork in
Speaker 2 (29:41):
Decades, if ever <laugh> well, I have that very personal experience myself. So I, I was interviewing for a, a really cool job with a, not a startup exactly, but a much smaller company sort of, you know, 10 years ago. And I remember I got to the, I was always the bridesmaids, never the bride. So like three different searches as that happened in. And wow. You know, at some point you’re like, what am I doing wrong? But the reason what, what was happening is I was coming out of PepsiCo. I was coming or Footlocker in PepsiCo when I was coming out of these big, big companies where, you know, the, where my bonus and my, you know, my success was, was, you know, maybe 10% variable. Like if I nailed the, just nailed it that year, it might be 10% more than, than not. And then you go into, you know, a startup where there’s no salary like afil flight.
Speaker 2 (30:28):
I mean, I will not even tell you, I, it took a year, it took a year to get my first paycheck, which was $97. And so I’m not joking. And I went to dinner on that $97. That was my year. So it it’s just, uh, so in those searches I was in the feedback was like, everything’s awesome with her, but how’s, she gonna know how to turn on the lights? And I like was like, what do you mean turn on the lights? Like, I, I know how to, you know, light switch. I mean, I get, you know, and, and I didn’t understand what they meant and I, now I do. Right. And, and what they mean is how are you gonna keep ’em on? Like, when you’re, when it’s really early. And you’re for example, at, at Chick-fil-A and we were making zero money for myself, I mean, corporation made plenty.
Speaker 2 (31:11):
Um, I made none. And so, you know, I, I, it was, I ended up doing things like looking at my trash pickup. I had three a week and it was 200 bucks to get trash picked up and my trashcans weren’t full enough. So I was like, what, wait a minute, let’s go down to two and see what happens. And it was fine. Right. So the thing, so it’s like these things that you just have to be, so, so in your P and L like you, I knew every 10 cents in my, in my business was I knew what a point, 1% labor up of a day meant, or even an hour. And, you know, you just have to know that, that, and that’s how, you know, how to drive the business. And I think in big companies, and this is my experience is that I never had all of the functions underneath me.
Speaker 2 (31:55):
Right. I was never the CEO. And so, so you never, so, so you have to do sort of all of those different roles, even if, to the role that you’re in that seat that may say the word COO or chief strategy or whatever it might say, but the reality is it’s like, get the, get it done, right? Like just whatever hat you’re like, everybody we’re just pulling together and we’re just gonna get this. We’re just gonna get this thing done. Very, very different level of energy required, very different risk pro profile as a person, clearly I’m back to, uh, after having done the entrepreneurship thing for the first time, clearly I’m back to corporate for a reason and a really corporate at that. But, you know, I think the balance of, of what your life can handle in terms of risk and stress is, is what, uh, risk and stress and reward and control and ownership. <laugh>, those are all together with an entrepreneur.
Speaker 1 (32:48):
Okay. So if you had it all to do again, would you,
Speaker 2 (32:53):
Which part all of
Speaker 1 (32:54):
It, any of it?
Speaker 2 (32:58):
I would do all of it again. Yeah. Because be caught. And here’s why, because even though I apparently have not learned the lessons of some of my failures yet on my first one, I’m certain that by my third, I will, now I will now know to start small and build <laugh>. Um, there’s no, there are several things. I there’s several, several, just incredibly important lessons. It, I don’t, I wish I could learn ’em before you do ’em. Yeah. But, you know, you get the test and then the lesson in entrepreneurship. So, uh, just keep taking the test, take the lessons and, and, and, you know, know when know, when to call it, like, if, if something’s not working, you know, uh, know, know also what your tolerance is for, for your time and money and effort. Um, and when you’re, when, when the right time is to say, let me, let me do something else as well. So
Speaker 1 (33:49):
Entrepreneurship isn’t glamorous is what I’m hearing. <laugh>
Speaker 2 (33:53):
It is not, it is hard work. It is really fun, especially for someone with my personality, right? Like, I, I just really love, I love building and I love building in any context. Um, maybe except for the construction going on in my house, I love building in every, every context. And I, um, there’s really nothing more fun than having a vision and then seeing it brought to life, uh, and then, and then convincing other people, you know, to come along with you on a ride for that vision, it intoxicating, um, which probably leads me to a question you haven’t asked, which is, how do you say, how do you have, how, how, how does a CEO keep out of hubris and out of, out of ego? Um, I think it’s a killer for, for, I just think it’s a killer for business to have those things.
Speaker 2 (34:41):
On the other hand, you have to would be just absolutely maniacally, maniacally, convinced that your idea is the right one. So it’s this balance of certainty of the idea, you know, hard work, hope of prayer that it will work. And then if it does, how do you stay out of the, the space that’s oh, I, you know, it’s because I’m a genius, uh, versus it’s actually all, you know, the market can turn well for you. You know, your team can do great for you. There’s a lot of ways that you can be successful, uh, that you might misidentify. I feel that identifying why I have failed is a lot more, is a lot more, uh, is a lot more obvious to me and the failures are helpful because they, they are the ones that should teach lessons.
Speaker 1 (35:30):
What do you think about there’s this perception? And, and I hear this a lot in tech, but I, I, you know, I mean, it would be easy to look at Sarah Blakely, or it would be easy to look at Whitney Wolf herd who exited Bumble, um, and say overnight success. Right. And, and yeah, thank you for laughing that it’s, it’s such a myth and yet people buy into it because it’s the part of the story that the media tells because it’s sexy, it’s romantic. It’s. Ooh, that’s so cool. And how so, so, I mean, I just, I guess what’s your perspective on, on this overnight success myth, and what would you tell people who think they’re gonna get into entrepreneurship and sell their company next year for a billion dollars?
Speaker 2 (36:13):
I would say if you’re a woman, I would say if you’re a female entrepreneur, like the one you’ve mentioned, uh, I think there’s a difference actually, because there’s a difference in how, how women in men can raise capital. Um, and that’s a, a, a, a we’ll get to that next, hopefully. But first of all, Sarah Blakely, we’re, you know, she sold panty hose out of a, out of a front, a storefront for years. Um, and she tells that story all the time, you know, uh, and, and, and changing, uh, you know, route to market, changing, changing everything about sort of what she was doing. And, um, you know, and 20 years later, she, she is able to, to, to, and she’s been very successful, but 20 years later to be bought, uh, by, by Blackstone’s a big deal. So I think, you know, I think that, uh, yeah, I think that there’s, you have to be, you have, I think you’d have had to think about the idea for, for 10 years, you might execute it yeah.
Speaker 2 (37:09):
In a short amount of time and it might be successful, but I just don’t think unless you just really get it right. Uh, right out the bat. And I, you know, a company here in Denver that I love under mind, I think that, uh, Mark Frank, what he’s done, you know, that’s not a very old company. Um, and he had the right idea. He had, uh, a real, real issue in the market that he was solving and, um, you know, and then the pandemic brought that even more to, to life. Right. And, and so great idea, greatly great execution market conditions also favorable and then was able to just raise and, and so, and raise a lot. So it was
Speaker 1 (37:47):
Sort of like everything kind of perfectly aligned to create that, that perfect storm. And that’s, that’s rare. Right.
Speaker 2 (37:54):
Really rare. It’s really rare. And Tom shoes model is another one that was really rare. That was a very story, uh, to success. Um, and then also a fairly, a fairly quick fall. Um, but those are also, uh, men raising money. So when you go into the, into the, how quickly can females become overnight successes? I think that, um, I think it’s harder. It’s harder to raise money. Yeah. Uh, so it’s harder to expand quickly. Yeah. So just, uh, you know, by definition, uh, if, if money equals speed and in some ways it does, um, female companies are going to go slower, uh, just because of the capital difference
Speaker 1 (38:30):
Differential. So I’m, I’m glad you brought that up. So cuz you and I both kind of share the same frustration that this is the way that it is, but you know, we figure out ways to change it and move forward. Right. So as of last year, as of, you know, the latest data in 2020 women represent about 25% of the founders in tech companies and women get about 2.8% of all the money. So out of about 190 billion, that was inve that was invested in startups last year. I think we got, what was it like 20 million or something like that. Right. Or 20 billion. So what, why is that first of all? And if, if you know, I mean, I am a woman who’s raising money right now, but for other audience members who might be women or have female founders and are looking to raise money, what’s the advice to them. And how do you overcome that? How do you not become the statistic or how do you help be part of changing the statistic?
Speaker 2 (39:27):
Yeah. I think that what we can do as women to take on sort of, you know, what think about what can we do, what do men do differently than we do? Right. I, I think one thing as an investor, I see, and I do see a lot of different pitches. Right. I think that, um, there’s a, there’s a confidence, uh, that comes probably from, you know, lifetime of being either, you know, in the majority or, or not. And I think most times in early stage in investing and, and you’ll hear if you read about why people invest early stage, it’s actually very few people invest in a business planner and numbers. It’s actually mostly about the person. Yeah. And so the characteristics, I think that we need to really make sure that we’re exhibiting are those that drive confidence in, in other people, uh, predominantly male investing base is that we, uh, that we have the goods that we know how to do what we’re doing.
Speaker 2 (40:20):
Yeah. And, and that comes from confidence. It comes from knowing your numbers. It comes from having a plan, um, and not overtalking that plan, you know, being ready to being, being passionate, but being also, uh, logical about, about, um, you know, kind of how people think. And, and, and I had just how I talk about what I’m doing depending on what kind of person’s sitting in front of me. Yeah. Um, there are people, you know, who invest, uh, I’m in a heart business in my mind. Um, but there are people who do invest in heart businesses and there are a lot of people who don’t do that. And, and, and why, you know, and, and it’s about, you know, the, the arbitrage and the, and, and the return. So I think that women can do ourselves a favor actually in, in part by, by watching other successful other successful people, whoever they are and what it is they’re doing.
Speaker 2 (41:07):
And I think that a lot of times it’s a very short, crisp plan that, you know, the 30 seconds in the elevator that you can pitch it, that you can pitch it with your passion, but you can pitch it logically all day. And, and that you understand how the financials really tie into that because, you know, that’s the other thing that sometimes is missing is this, uh, this, you know, this super creativity that it takes to start a company and have an idea and a vision, but then this financial savviness to understand how, you know, who, who you’re talking to and what it is they’re going to be looking for, uh, in your results. And so I think we can do a lot for ourselves in that way, getting ourselves ready. And, and I don’t know what I’m gonna do in that space, but at some point I’m gonna do something more in, in helping in helping people understand that.
Speaker 2 (41:50):
Yeah. So I, I like to always start, if, if that’s not clear, I like to always start with what, what can we do versus like, why is the system what it is? Uh, so I think what we can do is what I’ve mentioned. I think, I think the more we do that and the more female investors that we have, you know, Sarah, Sarah Blakely, uh, went with Blackstone because it was three women on the investment team. And she made that very clear in the press. And so I think that also, you know, more and more women in the investing field, you know, tend to have a, a lens toward, you know, a broad, I’d say a broader maybe group of companies. That might be interesting. I mentioned right away when I, when I, I have a friend at spanks and the minute I minute, she went there, I said, if you guys ever raised, give me a call because, you know, that’s a com and at the time it wasn’t, wasn’t on the, on the table, but you know, that, that female investing team is important. Yeah. So I think that, I think that that’s sort of what we can do as women, but then I think also, you know, making sure that, uh, that we keep, keep going in the industry where the, where the money does sit and, and that we start to get more and more people in there that are representative, not just, uh, women, but representative in minority.
Speaker 1 (42:57):
Yeah. It’s interesting because I had a conversation, you know, Charles Fred through true space. I think I introduced the two of you and maybe you chatted or mm-hmm <affirmative>. And so I had a conversation with him. Um, so his company is like an accelerator for companies that are in, they have revenue, usually somewhere above like half a, a million to a million in revenue and helping companies get to that 10 million mark. Cause it’s sort of like a magical number where a lot of, a lot of stuff opens up. Right. And so obviously we’re not there yet, but he really likes what we’re doing. And so he’ll have conversations with me whenever I ask. And so the last conversation we had, I was like, he said, well, how much are your time of your time? Are you spending fundraising? I was like, probably about 70% of my right now because that’s like where my focus is.
Speaker 1 (43:38):
And he goes, he said, I want you to back that off to know more than 50%. And he said, and you need to set a minimum. He’s like, can you imagine a guy in your position getting on the phone and spending all this time and talking to people, multiple meetings for $10,000, he’s like, he would never do it. He’ll say 50 thousands, my minimum, if you’re not willing to do that, don’t waste my time. And he said, you should try that. Right. So I did. Yes. Agree. And it led to much more interesting conversations where we’re actually in due diligence with a couple of investors now. And I’m like, okay, why does that work? Because it kind of seems, you know, the thing that I, I don’t like is that it feels a little bit arrogant, but it’s actually not because my time is actually valuable. And if I’m going to execute on this thing that I’m building, I have to value my time and expect that my investors also value and see how important my time is for what I’m doing. And I think that’s, I think, yeah, I think that’s one of those things that men do really well just naturally because they have always been on top. And so they, they just think that way and we’re, we don’t, we don’t orient ourselves that way naturally or by default, I think,
Speaker 2 (44:47):
I think we start negotiating down before we even ask the question and, and I don’t know, and I didn’t do that. I, I just did that on something. So, you know, so all this advice like I’m,
Speaker 1 (44:59):
Speaker 2 (45:01):
Do do it yourself guys. I’m not sure that I’m the right one, but anyway, um, you know, I, I think that, I think because we’re scared, I, I think we’re scared of sounding or being yes. All the words, right? Like you pick a word that, that women get in business and, and, but yet, you know, it’s, it’s really easy, like, just think about it. It’s like, how would you negotiate as a child for more candy? Right. You’d be like, can I get the box? You wouldn’t say that. Can I have a piece? Like, I always was like, can I get the box? And if I couldn’t get the box and I was like, can I like three pieces? And then, you know, there’s just better to, it’s fair buying start high, you know? And, and then if people can’t do that, you know, as you’re right, like, uh, whether, I mean, $10,000 is a lot of money.
Speaker 2 (45:40):
Um, you know, a lot of money depending on what kind of invest you’re talking about friends and family, that’s a lot, but I, yes, I, I, my, the investments I’ve made in my friends had minimums and, and that’s, uh, and, and so some of ’em I couldn’t make, so I’m out out of those deals. And I think that’s fair. I mean, I think trying to raise it’s like death by a thousand paper cuts trying to raise 10,000 from, you know, a thousand people is a whole lot harder than just raising from smaller amount of people. Cause it all does take, it takes time and effort. And if you’re doing that, who’s got the vision and for the company who’s pushing the company forward, not to,
Speaker 1 (46:15):
To mention the most that your cap table is later. Right. I mean, I know people have got like 350 people in their cap table and you’re just like, oh, <laugh>
Speaker 2 (46:23):
Yeah. Oh, it’s just awful. Awfully messy. Yeah. The smaller that, the, the, the, the cleaner that cap table, the easier life is I think so,
Speaker 1 (46:35):
All right. So totally different type of question. What job, other than your own, would you most like to try
Speaker 2 (46:45):
A Marine biologist? <laugh> I would like to, because I’m, I love that I’m a scuba dive and I am fascinated by the ocean and everything in it. And I, I think I could totally live on Roan island and Honduras, where they have, uh, amazing ocean discoveries all the time. I could totally do that. And I, I wish I had, I will never it’s the opposite of my, of my background, but yeah, I think I would do that. I would wanna understand more about, about what the is, you know, mostly covers the earth.
Speaker 1 (47:19):
Oh my gosh. I love that answer. That’s so fun. <laugh> can
Speaker 2 (47:23):
You tell that I’m like, yeah. Perhaps what I’m in is maybe not what I’m the most. No, I, I, I try to do passionate businesses, you know, but I would, I would definitely, I’m a rescue diver and I, I spend a lot of time in the water. It’s my favorite place to be. So, oh, I love that. Me too, by the way, me too. And people say, if you’re gonna, and this is maybe the lesson from that is that if you are gonna start something, you know, even if it’s intellectually a really good idea and you think you have, you know, the you’ve, you’ve cracked the, the widget that you’re gonna, you’re gonna sell you. Like the, the, if you’re slightly passionate about it, that’s one thing. Um, if you’re really passionate about it, which I am about refugee acupuncture, I’m really passionate about that.
Speaker 2 (48:03):
And it’s still not what the level of passion I have for like, I would live under water if I could. And I would say, if you’re gonna start a business, try to start a business in that I would live underwater if I could space, because yeah. It’s, if you can’t live without it, if you can’t live without it, you’re gonna, when the hard times fall and they will come undoubtedly, and they are real hard at first, then you can remember, because you’re in love with that thing that you’re doing. And, and I don’t know if people talk enough about how much love you need to have, you need to have conviction, but you need to have serious, like personal interest. Cause it’s what you’re gonna do a and think about a lot and talk about a lot. So if it’s something that you can, you know, get fired up very easily talking about, then it’s a whole lot easier and people can feel that in investing too, you know, people can feel that you care a lot about what you’re doing. Totally. Um, and I think that’s, I think the heart is, is why a lot of early stage investors invest. Yeah,
Speaker 1 (49:01):
Totally. Okay. So what’s one question you wish I’d asked you that I didn’t. And how would you have answered it?
Speaker 2 (49:09):
I’ll probably the myth that you, that, that if you’re an entrepreneur, that’s all you do. Like the work, the work life balance that
Speaker 1 (49:17):
Oh, yes. Say more about that.
Speaker 2 (49:20):
So I think everyone not only thinks that an overnight success is what every entrepreneur does, but I think that they, I, I think they also think that there is, you know, that as an entrepreneur, that you’re, you’re never going to do another thing until you sell that company. And that it’s, you know, it it’s that your work life balance is going to be terrible, that you know, all these things. And it scared me off of being an entrepreneur for a while. Yeah. Because I actually want my life, like I live my life as I live it. And I have a husband who has health challenges, I of elderly parents, you know? And, and I have a lot of outside interests. So I was always afraid that if I started being an entrepreneur, that I would somehow, you know, lose track of all of those really important relationships in my life.
Speaker 2 (50:07):
And, and, you know, I think that can be true for, for people that I wanna debunk that because is, I think that there’s a way, again, it’s about speed, but there is a way you can go so fast and then burn out completely and quit. And I’ve had one of those in my career. Yeah. And, and that’s not helpful. So I really am pretty good at self care during, uh, even so even having a day job and being an entrepreneur on the side and all the things I just described, I really do take time for myself. I I’m a runner. I take that time to, to, to stay physically fit. I care about diet because it’s the fuel for everything, all my energy. So, you know, there things that actually don’t seem like you’re working, but these things that I’m doing are actually making me a much better human, but also entrepreneur. So I, I, I think just the message of, you know, it’s, well, I’ll sleep when I’m dead. I think that that is a false message. And, and I, I, I don’t want people thinking that that has to be the way to run things, you know, because it might scare them off of doing something amazing that they, an idea that they have.
Speaker 1 (51:12):
It’s so interesting. You said that. So I was listening to a podcast the other day, and they were interviewing Ariana Huffington who created thrive out of that very thing, which is she bought into I’ll sleep when I’m dead. And it almost ruined her life almost killed her. Yes. And when she realized that that by deprioritizing sleep, deprioritizing, her family deprioritizing the rest of her life in order to build a big company, what she realized was she was not only killing herself, but she was wrecking everything that she thought she was working hard for. And so I, I love that you said that in, in Arian Huffington agree, that’s why she created a thrive <laugh>
Speaker 2 (51:51):
I actually like that’s so long ago in my career that I’ve seen her speak, but you’re right. Yeah. She, but she’s the one that got me into Headspace, which got me into, you know, so she, she definitely, uh, she definitely is. Right. I mean, and I think a great role model for that. Yeah. You know, she, she even gave out her personal phone number at, at the, uh, at the large convention we were, we were in. And what’s funny about that is that no one believes that that’s, you know, you’re like, well, that can’t possibly
Speaker 1 (52:16):
Be <crosstalk> phone number.
Speaker 2 (52:18):
Yeah. Yeah. I didn’t call it either. I, you know, it’s <laugh> but I think, no, I, I, I do. I, I mean, and I think that, you know, there’s time and, and I think making room for, or play, uh, everyone has to have fun and this does not feel fun sometimes. Right? Yeah. Even it’s your vision, even, it’s your team, I’m having a team dinner tonight at my house. It’ll be fun, but right. Even when it’s not fun, you know, I think, I think having, like, just trying to find those moments where, you know, humor comes in and where you’re able to pull to, I mean, it’s the fastest and easiest way to get a team on the same page is to have really funny things happen. And then, you know, even if they’re awful, but to celebrate how, how, you know, humor can come into, uh, and needs to be part of all of this. Yeah. Um, otherwise it’s way too serious. Yeah.
Speaker 1 (53:06):
Thank you so much, Tracy, for joining us today for sharing story, for bringing so much wisdom and insight, as you always do, which is why you are one of my favorite people on the planet. If listeners have questions or they wanna get in touch with you, what’s the best way for them to do that.
Speaker 2 (53:22):
Yeah. So Tracy, T R a C E Y at refuge, R E F U G E acupuncture, ACU, P U N, CT, U R e.com. Awesome. That’s
Speaker 1 (53:34):
The easiest way. Awesome. Awesome. Awesome. Make sure you follow refuge acupuncture on Instagram and keep up with Tracy through, through her company as well as potentially through like awesome. So we’ll include all of that in the show notes that everybody can get a hold of you. Thank you so much for joining us for this episode as always happy entrepreneur. And we will see you all next time.
Thank you for listening to this episode of Precursa: The Startup Journey. If you have an idea for a startup and you want to explore the proven process of turning your idea into a viable business, check us out precursa.com. Make sure to subscribe to this podcast wherever you listen to podcasts. So you never miss an episode until next time.