Join Sallie Krawcheck for an in-depth discussion in this video Risks of raising money, part of Sallie Krawcheck on Risk-Taking.
- So I recently had a post on LinkedIn that was the most commented upon post I ever put up there. And I've been doing this for a few years. It was interesting, the engagement it drove. The title was something along the lines of The Reasons Why You Should Not Leave Your Job to Become an Entrepreneur. So we're talking about risk today. So I'd like to get granular around risk and granular around risk of being an entrepreneur because being an entrepreneur today, the move to entrepreneurship, is so hot, it's broiling.
It is broiling. And everything I read about it is you're going to be so much happier than your corporate job. You're going to be so fulfilled as a person. You're going to be in a small, uncomfortable office for a very short period of time before you have the foosball and the endless beer and the brick wall. And then, you're going to be a billionaire. And that's sort of this, you know, mythology that's built up around being an entrepreneur. Well, as one who's done it and one who has made the shift to being an entrepreneur, there are a couple things I want to point out.
Because what I really want you to do is if you're thinking about making this change, I want you to get granular on the risk that you're taking on. We've talked today about the risk of failure, sure, about the fear of failure, absolutely. What are the things that can lead to failure? So, a few things that I've learned as I've made my transition to starting and funding Ellevest. Number one, raising money is hard. Raising money is hard. And what I've found, and I've been around for awhile, that even as I went out and was talking to people about what I saw as an enormous opportunity, investing for women, a well thought out and conceived business plan, a team that was starting to come together pretty well, that I was told my baby was ugly.
And this, by the way, it's hard for men to raise money. Let's face the music. It's harder for women to raise money. You've seen the numbers about venture capitalists. You've seen that we women only get, depending on the study, 3%, 4%, 6%, 8%, whatever it is, of venture capital funding. And so really, as you're thinking about making that transition into starting a business, what I want you to think hard about is what are those sources of funding. For me, it ended up being a lead investor whom I had known for a period of time where our interest, where our ethos, where our view of the issue, the challenge, the problem, the opportunity, were highly aligned, but someone I had known.
And it was individuals that I had gotten to know through the course of my career over a period of time who likewise saw this issue. There are other sources. There are, of course, angel investors. There's crowdfunding which for us women does a terrific job for us. And of course, a final source of funding which is one we very rarely talk about is revenue. It's a form of capital. It's a free form of capital. It's a good form of capital. So also think about getting to revenue sooner than you might otherwise.
What's holding you back? How can you gain the confidence necessary to take risks and chance failing? Sallie Krawcheck is a LinkedIn Influencer and one of the most successful and influential executives in financial services. She has built her career and reputation on thoughtful risk-taking. Here she shares an approach that will help you to take chances while mitigating risk—and keep you on the track to growth and continued opportunity.