On today’s episode, Kunle is joined by Andrew D’Souza, Co-Founder and CEO of Clearbanc – a company that helps high growth eCommerce businesses raise money without diluting equity. Clearbanc is the biggest eCommerce investor in the world, having invested more than a billion dollars in almost 3000 businesses since being founded in 2015.

We all know eCommerce is booming, and there are opportunities for explosive growth cropping up everywhere. But each business has its limitations. Capitalising on these opportunities usually involves spending more on marketing, growing your team and having bigger inventory. All of these are easier said than done. At the end of the day it comes down to the amount of capital you have on hand.

Raising funds is no mean feat either. On one hand you have the option of raising venture capital – where after investing a lot of time and resources you could just lose control of your company; on the other hand, you have debt financing – where you could lose everything you own if things don’t go well. Clearbanc’s mission is to solve this funding dilemma. Clearbanc has the system’s in place to analyse your business and give you an offer instantly. You can raise funds without the hassles and stress of VCs and banks.

In today’s episode Kunle and Andrew discuss strategies for DTC businesses to raise funds and grow in the current eCommerce ecosystem. You will get to hear about future trends and opportunities, and how they all tie into being omnichannel. You certainly don’t want to miss this one!

Here is a summary of some of the most important points made,

• • Equity financing can cost you control of your company
  • Banks (Debt financing) don’t care about your success
  • Being omnichannel is the way to grow in the current ecosystem
  • ECommerce is shifting from focusing on “one-off” items to recurring use items
  • Consumables and Pet industries are booming

Covered Topics:

On today’s interview Kunle and Andrew discuss,

• Solving the Equity vs Debt funding dilemma
• Considerations for Funding
• Clearbanc’s solutions
• Building an Omnichannel team
• Opportunities in DTC

Timestamp:

• 10:20 – Clearbanc’s MO:
  • Unlock capital for high growth businesses
  • Helps businesses raise funds without the hassles
• 12:30 – Andrew’s background:
  • Grew up in Canada
  • Background in consulting and finance
  • Experienced the pains of raising capital and ceding control
• 16:50 – How Debt financing can be detrimental to growing your company
• 18:05 – How Clearbanc has found a sweat spot between Debt finance & Equity:
  • Offer funds at the rate of 6%
  • Tenor is usually between 6-12 months
  • Use APIs to connect to your business data and give you an offer instantly
• 20:40 – Considerations for funding:
  • Run rate of $10+ per month
  • Been in business for 6 months
  • Typically when the business goes from sidegig to full time
• 22:25 – ClearBanc’s new inventory solution:
  • Purchase the inventory on the client’s behalf
  • Client pays as the products sell
• 25:30 – Taking your business from 8 to 9 figures:
  • Commit to Omnichannel – be everywhere before it becomes mainstream
• 30:10 – How are Clearbanc customers using other sources of capital:
  • Clearbanc encourages using capital as long as the client understand the terms fully
  • Clearbanc helps clients achieve incentives on Facebook
• 33:05 – Investments in UK businesses:
  • Invested 30 million pounds in UK so far
  • Plan to invest another 500 million pounds in the next 12 months
• 35:25 – How focusing on “local market domination”can help you build a solid business
• 37:10 – Building an “Omnichannel” team:
  • Being able to tell your brand’s story
  • Getting deep in the analytics
  • Understanding how to convey that story in different mediums
• 39:05 – Opportunities in DTC:
  • Biggest growth in consumables
  • Amazon works well for consumables
  • Great opportunity for DTC brands to reshape consumer buying habits
  • Pet industry is also booming
  • ECommerce is shifting from focusing on “one-off” items to recurring use items
  • “The real advantage of DTC is that you can establish a relationship with the consumer”
• 44:50 – Clearbanc funds all types of online business, including Amazon businesses
• 46:05 – Lightning Round

Lightning Round:

1. Q: What advice would you give to yourself 5 years ago?
   A: Don’t overthink things
2. Q: What are 2 things you can’t live without?
   A: My airpods and notebook
3. Q: What book are you currently reading?
   A: Just finished 1984
4. Q: What are your 3 indispensable tools for managing business?
   A: Execution and Focus
5. Q: What’s been your best mistake till date? A set back that’s given you the biggest feedback?
   A: Giving up board control of my previous company
6. Q: What book/resource would you recommend to most impact or grow your business?
   A: A book called Lucky or Smart by Bo Peabody (also Ray Dalio’s Principles)

Takeaways:

• Being omnichannel is the way to grow in the current ecosystem
• ECommerce is shifting from focusing on “one-off” items to recurring use items (Subscription!)

Links & Resources

• Clearbanc on Twitter
• Lucky or Smart? by Bo Peabody
• Principles by Ray Dalio

Tweetable Quotes:

“People focus way too much on attribution, and not nearly enough around media mix.”

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