How to Build a Multi-Million Dollar Business in Less Than a Year by Raising Money from Influential Investors with Lisa Odenweller

0:01Boom! Shake the room, Fire Nation. JLD here and welcome to Entrepreneurs on Fire. Brought to you by the HubSpot. HubSpot Podcast Network, the audio destination for business professionals with great shows like Creator Science. Today, we'll be breaking down how to build a multi-million dollar business in less than a year by raising money from influential investors. To drop these value bombs, I have brought Lisa Odenweller into EO Fire Studios. Lisa is founder and CEO of Chroma Wellness, the functional wellness brand that's revolutionizing the way we think about nourishing our bodies. She is passionate about health and wellness and encourages others to live a life where they can thrive with food rather than feel deprived.

0:45A San Diego native, Lisa is a wellness visionary and serial entrepreneur with over 15 years experience, having previously founded Organic Superfood Cafe, Beaming Wellness. And today at Fire Nation, we're going to talk about Amy Schumer, Gwyneth Paltrow, Jessica Seinfeld, investing in Lisa's company, how she managed that, choosing angel investors over investor capital, being investor ready, the advice when you're considering raising money, Fire Nation, and so much more. And a big thank you for sponsoring today's episode goes to Lisa and our sponsors. Artificial intelligence has made a splash in the headlines and for good reason.

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2:42Lisa, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with. Hi, everyone. Hi, John. I'm thrilled to be here. I love the question. And I think the first response is define success. So I was with Simon Sinek on a boat a week ago and he gave a talk and he, he said a lot of profound things, but one was success is the impact, not the credit. And we all paused when he said this and it seems sort of an obvious, but why I think it's so relevant for your questions specifically is that I think what happens in business and as a founder, we all start with passion.

3:27We all start with this huge vision and mission. And if we don't, then we probably shouldn't be starting a business. I think what happens is that sometimes gets lost in translation as we get into the business, we get into the tactical, we get into the minutia. If we've got a venture capital company involved, usually they're not operating from that same mindset. it's all about bottom line and I feel really passionately that you have to be operating from a place of impact that ultimately is going to drive the success of business and I don't think that I don't believe investors always see it that way and I don't believe that entrepreneurs always see it that way because I think we can lose our way and without the impact I think we lose the soul of the brand and ultimately how great of an impact we can make and how successful the company can be.

4:22Well, Fire Nation, we're starting off with a bang. Simon Sinek, a boat, value bombs, and we're talking about how to build a multi-million dollar business in less than a year by raising money from influential investors. And Lisa, you've found influential investors like Amy Schumer, Gwyneth Paltrow, Jessica Seinfeld for your company, Chroma. I want to talk about how the heck you managed those accomplishments. I'm going to say, I'm going to turn it around. They found me. And so let's back up a little bit. It's 2020, March, the day before the world shut down with COVID. I'm about to take my business plan out to the world with Chroma.

5:12I'm so excited to go raise money and the world shuts down and the, and, and the brakes come on and I have to pivot and figure out, all right, I can't go ask people for money while we're trying to figure out groceries and toilet paper. So I go into beta mode, putting my product, my five day reset out into the world and doing what I love, you know, getting, creating products and getting response, getting feedback in doing that. It created almost a viral response to the point where once I got momentum and I got the first yes to investor, which was, by the way, Dick Costello, who is the former CEO of Twitter.

5:51And I want to also say, I didn't know any of these people before I started raising money. And I think that's a really important point because I think sometimes it comes across as, well, she had this great network and she had all these contacts and these relationships. And the truth is, I didn't know any of these investors before they invested. What I did was put an amazing product out in the world with that huge vision and passion and mission. And ultimately, Gwyneth Paltrow, Amy Schumer, Jessica Seinfeld, Naomi Watts, Kristen Cavallari, etc., ended up finding me. And to the point where, as I built the momentum and raising money, I woke up to an email from Gwyneth Paltrow asking if she could meet because she heard I had a new wellness company and she wanted to hear about it.

6:34Fire Nation, this is really powerful stuff. We talk a lot about creating the number one solution to a real problem in this world. And we'll talk about this a little bit more later. But one thing that Lisa did identify was a real problem in this world. And she set off to create not the 10th best solution, not the 50th best solution, but the number one solution to this real problem that she had identified. And this is powerful stuff when you go at this with the passion that Lisa went at it. Now you got Chroma, Lisa, investor ready. I think a lot of my listeners, they don't even really know what that means.

7:16So how do you accomplish investor readiness? And what timeline did you do it on? So investor readiness was really over the course of a couple years, right? As you bring your idea, you know, it's not like you start an idea and go out and raise money. I guess maybe some people do. For me, it was, I've been in the wellness industry now for 14 years. I had had another company called Beaming, a very successful chain of healthy grab-and-go restaurants in Southern California. I sold that. I took pause and looked at how do I take the magic of what I created with Beaming that had changed so many lives, inspired so many lives through this delicious, healthy, high-integrity foods and superfoods, and reach more people to create greater impact.

8:01And through that process, you're getting investor ready. But I had to get the product ready. I had to get the mission, the vision. What are we building? What's the opportunity? Why would somebody invest in us? So it was a combination of, of course, creating the best possible product and a business model that made sense and being able to articulate that in a way that Dick Costello and Gwyneth Paltrow and others would want to jump in and be part of this movement, really, that I was creating. So, in getting investor ready, I mentioned earlier, I did this beta pilot and the world had shut down. I really couldn't ask for money.

8:43So, what I did is I put this beta product, and to be more specific, what we have and what we're most known for is our five-day reset, which is this delicious, non-perishable foods and beverages that you literally just add hot water and you can create a perfect matcha latte. in the morning with collagen and turmeric and ginger or a breakfast porridge or a bone broth and a veggie broth or a smoothie. It's literally a, I don't have to think. I keep life simple, but I'm nourishing myself. It tastes amazing. It goes to the office with me. It goes to the park. It goes on the airplane. I created something that that market hadn't addressed yet.

9:19So let's start there. And then I beta tested it to friends and friends told friends. And then that became sort of its own viral thing because people were having this amazing experience. They fell in love with the product. They were having the results, which is feeling good in my body and losing weight and feeling inspired to make changes in their daily life. So I want to make sure I don't take that lightly because that was a really big part of getting investor ready, which ultimately led to the first yes, which, as we know, is the hardest one. I had a million venture capital groups. And again, through COVID, nobody was writing checks, especially for a pre-revenue, pre-proof of concept startup that was raising two and a half million.

10:03And the response from the VCs was, great idea, Elise. Let us know when you've got it launched and come back to us then. So I had to change the way I was approaching raising money. And the way I did that was, what if I could raise money from some of the most influential people in the country who would help me tell the world because they believed so much in what we were doing. So that was the idea. And then I had to roll it into action. And that was just going out and tapping my network, going on LinkedIn, finding people I didn't know, trying to get them to listen to me, to get them to connect me to someone else.

10:40And it was just the, you know, knock on doors until you finally get your first yes. And when I got the first yes, and of course was a business plan and all those things. I can come back to that if that's relevant. But it was that first yes from Dick Costello and then asking him, once he had his full buy-in, who else he could introduce me to. And I did a talk at a women's conference once and I showed this tree, how this one person that introduced me to Dick Costello, a friend of mine, that then Dick introduced me to three people, that then introduced me to more people, that then kind of webbed out from there because every person kept telling somebody.

11:20And the next thing you know, I'm waking up to an email from Gwyneth Paltrow. Fire Nation, there's a lot there. But one of the things I want to go back to is this is not some kind of overnight success. I mean, as you heard, Lisa's been in this space, in this industry, putting in the work, the effort, the blood, the sweat, the tears for a long time to lead to this moment where she was ready for Chroma. And speaking about ready, I mean, I actually just got back from a 23-day river cruise. And I can tell you, after three gourmet meals a day, and by gourmet, I don't mean healthy. I mean, you know, gourmet, unhealthy.

11:55I'm ready for that five-day reset. That's dreamy. And it's time for a reset. It's time for a five-day reset. Send it down to Puerto Rico. We need it down here desperately. We've got you. Love it. But Fire Nation, do you have that kind of passion that can carry you through, like Lisa's talking about? And you did kind of mention like the investor capital, the venture capital thing, going against the opportunity of angel investors as well. Not that you necessarily had a ton of choices because, again, they weren't necessarily ready until you were post-launch, but you did go the angel investor route.

12:29So let's talk more about that specifically. This was not easy. I mean, there are a lot of tiers. In fact, you know, it's so getting to that first yes is is really difficult. And so I'll tell a story along the way. So the VCs have said have said great idea. Call us later. I get it. I get a billionaire who finds out about the opportunity and he falls in love with it. He is just like, this is brilliant. He's crying to me. I've lost 20 pounds because of you. I've changed my life. I don't drink seven Red Bulls a day anymore. you've changed my family's life we're gonna change the world and he is all in and strings me along and there was this inner thing within me that's like I don't trust this and I unfortunately did what a lot of us do is I really needed the money and I was really anxious and antsy to get Chroma off the ground and so I kept dabbling with this guy because he's you know hook line and sinker sending me emojis and all these things of how we're going to change the world together.

13:37And I kept waking up in the middle of the night saying, something's not right. Something's not right. The day he's supposed to fund, and we've already agreed to terms, he disappears. And we never hear from him again. And the importance of mentioning that is it was the greatest gift possible that this didn't show up for us because it forced me to, one, trust my instinct, to go out and really find the investors that were going to get behind us for the right reasons. And that became really clear about how I approached raising money. I had to get people who were not just in it for what the return could be, but people that really believed in what we were doing and that were going to to stand side by side with me to do that.

14:29That was the intention. How I was going to do it was just one by one by one. And I think that that's just a really important part of this. It was a very, very laborious process. It was very stressful. I had used all of my 401k. I had spent every dollar to my name. And November 3rd, 2020, I couldn't pay rent or buy food for my kids. I wasn't going to be homeless, but I was at that point of, what am I going to do? And that's when I got the first check. And that led to the second check, which came from John Callahan from True Ventures. He was the first check in Peloton. The third check was from Brian Meehan, who was the CEO of Blue Bottle Coffee.

15:17And the fourth was the first woman to say yes, which is Jenny Lefcourt from Freestyle Ventures. They each then made other introductions, as I was mentioning earlier. And that's really where it all began to happen. But it was a very, very painful process to get to those first yeses. I love that you broke that down in that manner, because a lot of people listen to just kind of the surface level thing of like, oh, look what happened. And then all these people, these famous people invested money because they heard about it like on a tweet. And the next thing they know, you know, the company is worth, you know, valued at this X number evaluation.

15:50And like, I'm going to go do the same thing. and they need to be grounded in the reality that, hey, anything is possible, but at the same time, there's going to be blood, sweat, tears that are going into anything that's of any meaning, especially in this entrepreneurial world. And Fire Nation, we're going to be really getting into some strategies when we get back from thanking our sponsors. Success Story, hosted by Scott D. Clary, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Success Story features Q &A sessions with successful business leaders, keynote presentations, and conversations on sales, marketing, business startups, and entrepreneurship.

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18:46Lisa, we're back and we talked about this a little bit when we were going over some of the fundraising stuff, but you've been very, very successful with word of mouth marketing, which is so valuable because it's free, it's trustworthy because it's usually coming from people that the other individual knows, likes and trusts. So how can you share with us the ways that you were able to do this successfully? And maybe we could follow some of those strategies and what we're doing in our businesses. Going back to the vision I had for raising money, what if I could raise money from really influential people?

19:23And by that, I didn't mean just the celebrities. I meant everyone from the celebrities to the mom in the community that wants to tell the world and then everyone in between. So the first thing was, if I could get word of mouth marketing, just starting with as investors, I have 110 of them. That is intentional. People look at me like I'm crazy. Like how in the world do you have 110 angel investors? I did it intentionally because I knew they would be basically our go to market and it worked. And so it was, it was that out of the gate. of course some of them have larger reaches than others um getting them bought in i mean they were so bought in they were so excited to tell the world with me whether it was through an instagram post whether it was through their friends whether it was through an article in a magazine you know or a testimonial whatever it was but all of those things fed on themselves of course then that led to press and other things that really the the story was there but I think at the core of it is the product is amazing.

20:28And I have been in the industry working with superfoods for 15 years, longer than anyone really using maca and spirulina and mushrooms and things that no one had heard of 14, 15 years ago. So I had the credibility of just knowing how to work with these, how to create products that marry function and flavor probably better than anyone. And so I don't want to make light of the fact that the product does speak for itself. And because of the product speaking for itself, because it is enjoyable, because it helps make people feel so good to get in their bodies, to do the reset that you need post your big trip for 21 days and get people to feel in their bodies, realize how enjoyable that can actually be.

21:11It became something that people wanted to tell people. There was no sacrifice. It was like, this is incredible. I get to have this food. And I change the way you cleanse. And that's something that I've always done in sort of how do I look at the market, address a need that's not being done in a way that I think is as well as it could be. And that's the problem we're always trying to solve. I did it with my last brand Beaming where I created a cleanse, a culinary cleanse of food and juices and smoothies and salads and snacks instead of juice cleansing, which is what we were doing years back. And I made it about nourishment.

21:47I did the same thing with Chroma where I really focused on how do I give people what they need, even if they don't even know they need it, but I know everybody wants to feel good and look good. So what if I create a program that helps you feel so good and look so good and you can still show up for your family, for your friends, for your kids, for your workout, for yourself? And that's a very different approach to the typical diet and cleanse culture that's very toxic. So by me having a very differentiated product and market position, it created its own viral response. Fire Nation, this type of cult following happens when you really allow people to get that number one solution to a real problem that they have.

22:37Because again, people don't want the fifth best solution to a real problem they have. They want to look great. They want to feel great. They want to be going through the process in the way that's very meaningful. I mean, all of this is really important when you're going through this process. And as you kind of did allude to, Lisa, you've built not one, but two fantastic cult-like followings with your brands in the wellness space. You talked about a strategy that you employed to do that by just creating that great product itself that speaks for itself, that stands on itself, that encourages that word of mouth marketing.

23:15What's something else you can share with our listeners that want to build something in their niche and their passion that's similar to what you've done? Well, you have to create trust and loyalty. And so by doing that, and because there's in my space and in most spaces now, it's very crowded. How do you differentiate? And so for me, it was delivering results. It was having people that you trust, again, whether it's a celebrity or the mom in the community or the lawyer in the office that really bought in to what these products can do. And within that, I'm in a unique position because the way that we created our go-to-market is the reset leads to the ritual.

24:05So for five days, you're eating and drinking and consuming Chroma products. So I have a very unique situation where I get to inspire you, whether it's directly or indirectly through the food and beverages, and really enliven your day throughout your day. If I can deliver, if the product can deliver those results and it's enjoyable, it automatically creates a trust and loyalty with the brand. That's the hardest thing to do in brand development is how do I create trust? How do I differentiate? And it really, I mean, I wish I could say that there was a silver bullet here. I think that this is something where all the dots have to be connected across every touch point from the product to the people who are involved, to the friends that are involved, to the influencers who are talking about it, to how, what happens when they land on your website?

24:59What's the first email they get? What's the engagement? Are you consistent across every interaction with your customer such that they want to continue to engage with you, that you make it easy for them to do that. And then of course, so much so that they love it so much that they want to tell their friends. Fire Nation, this is the full rounded approach that you really need to have when you're going to try to build something of meaning, of excitement that's going to stand the tale of time. And Lisa, you've shared so many great value bombs today. Take a step back. Give us the one theme that you want us to walk away with.

25:39What's that one thing you want to make sure our listeners get from our conversation today? What's coming to mind, there's so many, but the one maybe I'm living most right now and feels most relevant is it's got to be fun. And so we are busting our asses creating companies. And anyone who thinks that you're Start a company because you want more time and freedom, you know, needs to go find something new to do. That you cannot start a company without having so much passion, conviction and tenacity that even when you get knocked down, your why is so clear. You get back up and you focus on all the good, even amidst the yuck.

26:17And I think one of the things that I have really learned through my entrepreneurial journey is it's I have fun. People always ask me, they're like, oh God, you got to go there for work. I'm like, my work is play. I get to change lives. I get to inspire people. I get to interact with amazing people. I get to bring products to life that I want, that I consume every day, that people love and can't wait to tell me how much it's changed. So it's this very, it's this ecosystem of exchange. And I think it's very easy to get sucked in the vortex of the shit and really all the stuff that makes being an entrepreneur and a founder very, very hard because it is very, very hard.

26:59But the other side of it is if I can stay in that why, if I can stay focused on all the good of what I'm doing, of how lucky it is that I get to do this, it really fuels a different energy, not only for me personally, but everyone around me can feel that. Everyone I interact with, it's the soul of the brand. you are the soul of the brand as an entrepreneur, your energy is going to feed into every, obviously your team and employees, but every interaction that you have from a conversation on a podcast to an interview to how you show up at the grocery store and get your daily coffee, that energy that you put out is the energy you're going to get back.

27:42Mike, drop Fire Nation. And Lisa, if Fire Nation wants to learn more about Chroma, connecting with you, your business, what's the best way they can do that? So to connect with me, it's Lisa underscore Oden Weller on Instagram. And then Chroma is just at Chroma Wellness on Instagram and then ChromaWellness.com. It's capital K-R-O-M-A Wellness.com. Fire Nation, you're the average of the five people you spend the most time with. You've been hanging out with L-O-N-J-L-D today, so keep up the heat. For links to everything we talked about, visit eofire.com. Type Lisa in the search bar. The show notes page will pop right up.