Stop Destroying Your Network: Sophia Amoruso On Killing Girlboss & Building Her VC Fund

31:25And it's still really gratifying. So I get to see that and I see it more than any kind of like flack that I've gotten. But no, I've always been, I've always felt like an outsider, but it doesn't necessarily get easier. But when you find where your talent lands and you create value for people and share your story and it makes them happier, they learn something and you get that feedback loop, then you start to feel like you belong a little bit more. I think it's important to remember that all it takes is one relationship. All it takes is one serendipitous thing to happen. It could be, it doesn't have to be in a meeting.

32:07It doesn't have to be at an Andreessen Horowitz cocktail event at LA Venture Week. Like it can be at dinner with some friends and some other person tags along that's doing something interesting. You say, hey, I'd love to learn about that. Or you just become friends and then you meet other people and they're like, hey, let me show you this world. Right. Like as you put yourself out there, the world opens up to you. But you have to put yourself out there. Right. Like. I had this boyfriend that did a lot of DMT, which is a psychedelic. and he said he saw probability cats and he saw probability cats and it was like cats jumping in every direction it's like each cat spawns more probabilities and so I've always had this kind of visual of yeah like you do one thing and you have no idea how many more probabilities that creates you do two things how many more possible things can that spawn and it could be that you learn something it could be that you meet someone if you don't say yes or you don't show up whether you're invited or uninvited or whatever it is, try different things.

33:14You're not going to find where you land. You're not going to find your people. Opportunities aren't going to open up for you. If you don't DM that person, if you don't put yourself out there and show who you are, that person's not going to DM you, right? I wouldn't know you if you hadn't done that. You wouldn't be here if you hadn't done that, right? And it's just like, it's bit by bit. And nobody starts as an insider. Do you agree with that saying then your net worth is your network? Kind of. I hate saying it. You know, it's like, but yeah. Yeah.

33:53I never hang out with people because of their net worth. I think, like, networks are important. And hanging out with someone powerful or influential definitely opens doors. But if I don't like somebody, I'm not going to go hang out on their boat hoping they invest in my venture fund. It would be torture. I'm just I can't pretend I'm not I cannot pretend to like someone or enjoy myself. And I'm not willing to do it enough to get more or extract value from people. So that's the place where I would say, like, don't do that. Just make sure that you like the people who might open doors to opportunities and don't put yourself around people that aren't nice or treat you like shit or fucking weird.

34:42Right. I'm like the wrong kind of weird. There's like weird and then there's like fucking weird. And when I say that, I mean like. You just posted a video saying everyone tells you how to build your network, but no one talks about how you destroy it. How does someone destroy their network? I mean, you destroy your network by making introductions that aren't qualified, right? Like, I'm not going to introduce you to, I don't know what, a rocket scientist and say, hey, you guys should do something great. Maybe they have a startup. Like, I'm not saying, you know, my friend Frederique is actually a rocket scientist, but she invests out of Google Ventures and you should probably.

35:25I love her, Frederic James. Yeah, yeah. We co-invested in Alara together. Okay, cool. Yeah, she's amazing. You don't need an intro to her. But, you know, it's like, but is this going to create value on both sides? It doesn't do anything for anybody to make introductions or connect people who aren't actually going to connect. If the person is not ready for the introduction, that's so nice. You're a really nice person to offer an introduction. And maybe you can you're trying to prove your value by putting somebody in touch with a more powerful person. But if that resource doesn't land or whoever it is that they want an intro to.

36:07Doesn't want to have a second phone call or isn't interested in what they're doing or doesn't want to have a first phone call, honestly, then you're wasting that person's time. You're wasting the other person's time. you're getting their hopes up and you know ultimately it like erodes your reputation because the next time you try to make an introduction to that person you should you know they're they're they're absolutely going to say no so it's your job to protect the interests of the people in your network you know the people who are coming up and who you could help by making those introductions but just know where it's going to create value you know it's like even if someone is in a position where it's like i don't want to introduce people to just pick each other's brains i hate when people say i want to pick your brain like about what though like i want to protect my brain yeah i mean i just i say no to most intros like even warm intros clothes it's like hey this person is starting a business where you can virtually try on clothes like I did e-commerce for 10 years nobody's figured that out right I'm sorry like I'm a girl's girl but no like no it's not gonna go anywhere so why waste anybody's time okay speaking of that because I love before I interview someone I actually go to Google and I'm like what are what are people searching for and it's so funny most people it's often like person's name parents person's name wife person's name net worth person's name whatever it's the person's name age always but with yours it's actually like what does Sophia Amoruso do now and that was actually what I was so excited to talk about because I feel like, yes, you're known for Nasty Gal and Girlboss, but actually what you're doing in the investing world is so fascinating.

38:08And it's one of the questions that I get asked the most is investing and the frameworks and the companies. And so I want to start the conversation with something that just only Sophia Amorizu could answer in the best way, I think, because you've navigated entertainment, venture capital, retail. Are you feeling the same sense of like this groundswell of like creator investing and celebrity investing and everybody wanting to get on cap tables when they're like famous? I mean, I see it for sure. I think it's great. I think it's great that people are building brands that can help amplify a startup and create value for them and get to participate in the upside.

38:53You know, it's like Hollywood, brand partnerships, things have been transactional for so long and they're one off. It's like, great, you get paid to talk about this thing. But if a creator or celebrity is actually really excited about investing in something, they're going to put more into it than, you know, getting paid to shill a product, right? And they're going to have a much longer approach to how they can support that company. I mean, I think Steven's a pioneer in that, right? And he's built a whole media company to, yes, entertain people, but also he's investing in companies that he can use his platform to support.

39:34And there's just, there's a whole ecosystem around that. And, you know, if you build a personal brand or you put yourself out there and people follow what you do and there's trust with your audience, you should absolutely use it to every advantage that you have to support the things that you're interested in. And if you're interested in them, the chances are that your audience is going to be too. So everybody wins. You're not just promoting a thing because some brand came to you with an RFP saying, we want one reel, three stories, and we want you to repost it to TikTok with 30-day, paid usage and 90-day organic usage and some kind of bullshit.

40:15It's like it has legs in a way that brand partnerships don't. But as someone that's written a million dollars personally into angel companies, so you've done my favorites that I picked out, AteSleep, Superhuman, Public, Liquid Death, Lovable, these are all who I would think of as winners in their category. A lot of people are going to start thinking about investing in these private companies and not know how to pick winners. And so it becomes actually like a really hard way to make money. So for you, first of all, out of those companies, who do you think will go all the way? I mean, Lovable is like a rocket ship.

40:56I mean, Lovable is making it possible for anybody to build anything. by chatting. And it's crazy because I still know people where I mentioned Lovable or even, you know, ChatGPT or whatever. It's like they don't know you can build websites by having a conversation with AI. They're still using AI like a search engine, right? Like perplexity, which was a search engine, felt like kind of a search engine. Like you can build like complete apps in it. Lovable is not the only place that you can do it. But what they're doing for people who are building software, even e-commerce business owners have to build software, even if their primary business is in physical goods, is what eBay did for me.

41:41Like, it's so powerful to me what AI is doing and personal to me, because it democratizes opportunity for people in a way that like an early marketplace did for me by giving me a place to like punch in a product description and list a vintage item and start a business. And so I'm very, very excited about where that's headed. Women are unfortunately adopting AI at 25 % less rates than men. What would you want every woman listening to this that isn't using AI to do tomorrow to actually get ahead? I posted about that. And I got so much blowback. What is this? Is this a cabal? Mel Robbins posted about it.

42:26Reese Witherspoon posted about it. Is this some kind of like evil AI thing where, you know, don't tell women what to do? Honestly, like I am so done telling women specifically what to do. But in terms like it's I got like skewered. Women were like really and I think 11 ,000 people unfollowed me when I made my first post about AI. And it was, you know, I found out the statistic. I hadn't seen Reese Witherspoon's thing. I wasn't getting paid for it. They were like, who's paying you for this? You need to be transparent about it. And I was like, no, I'm just using it. And actually, if you're not using it, I do think you're going to fall behind.

43:04That's an opinion that not everybody necessarily shares. But I feel like I can share the way I use things and how it's getting me ahead and people are fine. If I say, look, I built this thing. If I said women should build this thing, they'd be like, fuck off. so the way people can get ahead and because your audience is women and my audience is women if i talk about it right the people who self-select and find it interesting might listen is just use it you know follow newsletters about ai like follow me follow people who are talking about it in a way that's really relatable you don't need to follow the most like technical people follow cat gpt right Like she was on the podcast.

43:52That's why I was asking because one of her episodes is one of the top performing. And the number one save clip that we have is her number one AI prompt. Do you have a favorite prompt that you use all the time?

44:08That's not what I told you. Stop using em dashes. It's not this, it's that. Don't ever use that again. But I already told you that. What the fuck? Like, that's those are the prompts I use the most. As amazing as AI is, I'm still yelling at it. And I'm like, we already talked about that. Reference the other thread. AI can be frustrating. I do feel like sometimes it can make things take more time than just doing it. How do you recommend women be smart about money? I think being smart about money is saving money. I think debt is just I have a credit card, but it's only so I can get points and it's more secure than spending with a debit card because it's connected to your bank account.

44:57But I've never been in credit card debt. So I would say use a credit card like cash, pay it off every month where you can own your business. Don't be reliant on other people for money and then you'll put yourself in places where you can make decisions. I think saving money early is important. And then once it's saved or you're further along in life and you know what kind of income that you have or maybe you feel more secure, you can figure out what to do with it. But the earlier you start saving, the better. And I would say don't get carried away with Birkin bags. Like, that's fine. It's fine.

45:37Like, it's okay to splurge on things here and there that make you feel like a better version of yourself. But getting wrapped up in the optics of being of wealth, I think is a really dangerous thing to do and definitely not worth spending your money on. I would say coffee's worth the money. I'd generally just say that coffee's worth the money. Ten years ago, you were named one of the richest self-made women in the world by Forbes. I know. That's crazy. It is crazy. Do you think that people treated you differently? No. I don't know. I mean, I employed most of the people that I was around. So probably.

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48:48This episode is brought to you by PayPal. You know how a mom's bag has everything? Sunscreen. snacks a stapler the new paypal app is like that but for your money shop pay manage your account and earn rewards all in one place and with purchase protection on eligible items biometric security and pass keys you're protected at every step download the new paypal app to get started see paypal.com protection terms we're probably one of the youngest richest self-made women in the world. And I love the post that you just did about the eight things that people don't tell you when you're successful early on.

49:27I wanted to ask you about three of them. Success paints a target on your back. Proximity to power isn't the same as friendship. And success amplifies who you already are. What do those three mean to you? Yeah, I think success does paint a target on your back because people are looking at you they're looking to you as an example when you're successful people think that you've got some secret that they don't and they're looking for all of the clues and you know maybe they've outsourced a little bit of their story and their way of getting there because they think that if they emulate you that's going to get them there and you can be inspired by other people you can't replicate somebody else's story we're all going to have our same story.

50:18But when people build you up to be this like icon and you disappoint them and they're like, oh my God, the girl boss, her employees said that it's a toxic workplace. It's like, okay, some people didn't have a great time working at my company, but it doesn't mean that like I'm not a great person or I didn't do my best. When you're put on a pedestal the way I was and you're seen as the millennial poster child of entrepreneurship or the female millennial poster child of entrepreneurship and you let people down they're like who do we look to or you this is personal like you were my north star so if I don't have that like where am I going to look now in the same way that when someone's really excited about a brand like people were obsessed with nasty gal if their package came later we sent them the wrong thing it was like their friend stabbed them in the back like the level of anger people have when they are like hyped up on something and it doesn't work out or they don't get what they thought they were going to get is like personal and so me not being the example at every moment of what the girl boss should be whatever that was that people projected onto me certainly certainly put me in a place where you know I was ripe for criticism because when you stand for something or you're almost like a caricature of what of a thing which was like girl boss and something happens that stands in contrast to it people will hold it against you and i think a lot of female founders experience it i don't i don't think it's uncommon i don't think it's necessarily something that we're all going to escape i think it's just a matter of knowing that that can come with the territory and hopefully people have seen this enough to know that at some point they're coming for all of us like at some point if it hasn't happened to you probably gonna happen to you what's the headline whatever it'll sell something right like i sold magazines when i was a girl boss and fast company sold clicks for advertisers when the headline was does the failure of nasty gal mean millennials aren't ready to lead like am i the what just because i didn't pull it off where I wasn't perfect, that means that an entire generation, what?

52:53Right? So somebody's always making money somewhere by saying some kind of bullshit. That one just stuck out to me because even yesterday, I remember I was on the phone with my team and I was like, I'm held to a higher standard than other people. And whether it's because like Stephen invested or because of even the family that I'm a part of, I do feel like there is like I'm held to a higher standard than other people. And that scares me because I think the people that I want to emulate or that I find inspiring are the people that like when they're at the top, they're constantly reinventing themselves.

53:28Like they don't get comfortable with what they've done in the past. They're always trying to push the envelope. But when you do feel like there's a target on your back or like people are watching you, it is harder to keep pushing yourself. And I think that's like truthfully what drew me to like you in the first place. Yes, of course, it was Nasty Gal, but it's also like everything that you've done since then. And I think especially with the investing side of things, the companies that you're in, the fact that you've invested in over 50 companies, like you have points on the board, you have all these winners.

53:59It's like, that's the story that I find so interesting and so inspiring because life is long, right? And like, hopefully your first business sells within the first seven to 10 years. Maybe it doesn't, maybe it takes a bit longer, but there's so many different chapters that we're all going to have. And I think like on the investing side, that's the question that I get asked the most truthfully from like the dedicated angels. They are like, what is the framework? What are the red flags? And so what I have an expert in the chair of like someone who's lived and breathed this for the last few years, like what are the frameworks that you would tell people of like investing 101 what really gets you excited and then what are the absolute red flags of things where you're like immediately i will never invest money in your company i think number one with investing is don't invest more money than you are willing to lose so if you're an angel investor you're probably investing in an early stage company that is unproven and even if it is kind of proven anything can happen it doesn't matter how big a company is and these are high risk investments, right?

55:07It's not putting money in the stock market. Your money is going to be locked up for a long time. There is no liquid market for private company shares. Once you invest in this company, expect it to be stuck there for 10 years. You can't pull it out. You're not going to invest that$10 ,000 in a house three years from now. It's stuck there until everybody gets their money back. And that company has to sell or go public. And that usually takes a long time to happen. Invest in things that you understand. Invest in things that you would use. I mean, when you're getting started, it's like, okay, if you would be the customer, then that's definitely a green flag.

55:46I think founders are really, really important, especially at the early stage, because a great founder can pivot. I like second-time founders a lot. You're looking for someone who's either worked on the problem or they've been inside a company where they're seeing people experience the problem and they know they have an idea of how they can solve it. With angel investing, it's just important to start small, right? And just because, I mean, some companies will say the smallest check we'll take is$10 ,000. If you can't afford$10 ,000, don't get all hyped up and dump money that you don't have or can't afford into a company.

56:24So I think be mindful and start slow. And red flags is like the overconfident founder who's just like, I don't know, someone who gets on the phone and knows nothing about me. Like I've had people, I'm like, it's fine. You don't like nasty. You'll happen a long time ago. You might be 25 years old. That's fine. But don't get on the phone with anybody that you haven't done some research on. So I think that's a red flag. When there is a valuation that they invented, but there's no lead, and they're just kind of gaming people off each other, like, oh, these people are interested, but they can't name who they are, they won't name who they are.

57:08The valuation keeps creeping up. Okay, you said it was 50 million last time, but now it's 60 million. Why? And then if somebody already has investors, and they're going to raise a subsequent round. If those investors don't want to continue investing, it can be a red flag that there's something that they see and they don't want to keep putting their money into the business because they're monitoring it. Maybe it's better that they put their money somewhere else. If the existing investors aren't continuing to invest, that can be a red flag. And that happened to me at Astigal. It made it really hard to fundraise.

57:43When you're investing in a founder, what are the three things that you absolutely look for that they have to have to invest money in them? They are hell-bent on solving a problem that they've either experienced personally and want to fix, or they've been inside a company and seen the challenges that the customer is having or what that opportunity might be and have a clear vision of how they want to solve that. I like founders who are like cockroaches who are just never going to go away. They're going to keep showing up, whether they're asking me for money and I haven't invested in them, Or if I have, they're going to keep asking me for things.

58:18Ideally, there's a point where the company is much bigger and they don't need me and they've like graduated. But in early stage companies, you need to be using every resource that you have. And I invest because I'm a resource and it's really fun. And I want to flex that. And I want to because it's very gratifying for me to use my experience and see what connections I can make. So why wouldn't you use me? That's the whole reason you're taking my money. The third thing is founders who are willing to take advice. They don't have to take all of my advice. Like, I'm not going to be offended if you don't do what I suggested.

58:59I think that's like, it's crazy when people behave like that. But they have to be open. Like, so the first question was they kind of have to be a visionary and hellbent, but But they also have to be someone who's malleable enough to listen to their customers, change the plan based on what they might be hearing, hear from people who might have more experience to help them see around corners, know that they don't have to be an expert in everything day one. So that's the combination of things and generally just someone I want to be around. I agree. Okay, Sophia Marissa, we have to ask you some rapid fire.

59:38Okay. What is the last thing you put on your credit card? Everything. What's the last thing? Coffee. Love ice. What's your order? A cappuccino with whole milk. What's the last most expensive thing you put on your credit card? Maybe this ring. Nelly Kilcullen ring. My friend's brand. It was expensive. Yeah, it's gorge. Yeah, thanks. What's the company you passed on investing in that you regret? It was Substack. So Andrew Chen from Andreessen introduced me to the founder. They were raising a round that was, I think, flat to the round prior. This was a few years ago. And I could have probably gotten like a hundred K check in or something would have been an angel check.

1:00:24But I didn't. And I don't know if they fundraised since. That's not the point. But they've I know they're killing it. Right. I know something's going to happen there. so shame on me what's the most amount of money you've ever put into one deal because you just had 100k there the biggest check i've written is 250 000 of my own money i'd say the best deal i ever did i didn't even invest i got advisory shares in 2017 in a company called passport shipping and it was just two guys that reached out to me cold i don't even remember what their background was but they were like we want to build this software layer that makes it easier for e-commerce businesses to track international orders because and for a decade at nasty gal we would send something internationally and it just went into a void like it was one carrier handed it off to another carrier and then it was like where is it there was no way to figure that out it was awful for customers it made us look awful for customer service and so i was like i I don't really angel invest.

1:01:30I don't know. But they gave me some advisory shares. It took nine years, 2016 now. And I just made 500 grand. Just like making some introductions along the way. I mean, they're grateful. I actually did put in work and they're happy. They weren't like, wow, you scammed us for free equity. But like, that's what can happen over 10 years. But I think that's what's the most interesting thing because I don't think you would have gotten those advisory shares had you not been the founder of Nasty Gal, right? And even though it's like you've said a lot in this interview or even as a friend, you've said like, oh, well, I was the poster child and then I wasn't what people lived up to.

1:02:13But actually what you're doing now is all partly because of your time at Nasty Gal. Sure. And like I have here that Nasty Gal was once valued at$350 million and you owned 80 % of the company, which technically made you worth on paper$280 million. Obviously, that went away. But you're still making half a million dollars because you were the founder of Nasty Gal. And that's just one thing that you're doing. And because I can pick winners. Yeah. Because I can make an impact on them, too. But yes, I will forever be riding in the coattails of what I did at 22 years old. and so to see like the fruits of my labor that I never thought would be fruits because I just had my head down is extremely rewarding and you only get to experience that after a lot of time has passed but there is a time where you know that it's time to move on and I think it's just a matter of listening and knowing that you're going to disappoint people you could lose people's money you might have to lay people off it's the worst but at the end of the day it is your life you do have choices.

1:03:21You should keep your promises as much as you're capable of. But when you have exhausted every avenue to make your investors whole in their money, grow revenue, you know, decrease costs, build an amazing brand, whatever those things are, when you've exhausted all of those things, whatever those things might be, it's okay to throw in the towel. It's okay to disappoint people. You have to pick one for the rest of your life. You're never moving houses again, or you have to move every single year. Never moving houses again. What fashion trend do you hope comes back? Like, are high-waisted pants out?

1:04:08Yeah, you can bring those back. I just, are they always out? No, you can bring them back. They're in there. But I wear low-waisted pants, but I just have so many high-waisted pants that out of laziness, I would like for that to come back. Love. What's a luxury brand that's overrated? Honestly, the quality of Miu Miu bags. Walking into their store. I was like pretty kind of disappointed. So I went to Balenciaga. Okay. Paris or London Fashion Week? London. I don't like Paris. I'm not a Paris fan. That's crazy. What is a fashion trend you would end right now? The teenagers wearing giant sweatpants.

1:04:51Like just like slobby style that ruins somebody's like physique. Like why would you ruin your physique just because you're following a trend? Like I don't know. Okay. Yeah. Okay. If you were to title this season of your life, what would it be called? Lime bike. Lime bike. I don't know. Lime bikes and what else do I do a lot? I don't know. Lime bikes and Euro summer. Love it. Okay, if you tell yourself one HSR love note for the rest of your life, what would it be? You're always going to land on your feet. Love that. Sophia Amoruso, thank you so much. Where can people find you and how can HSR help you?

1:05:36So Sophia Amoruso at everything. Trustfund.vc. Pitch me. How can you help me? I don't know. Get cool founders to pitch me and make some content that I can share because it's really hard. And hopefully this throws off a lot of clips. Love it. Thank you so much. Thank you.

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