Creative Strategies to Fundraise Without Sacrificing Ownership

0:00We have demand that we need to fill right now as a part of the pitch. So of course, it's about the message too, right? Not just, I need something from you. Like, oh, it'll make us look so good if we're on Rent the Runway. But here's what we think the opportunity is. Hey, everyone. Thanks for tuning in. I'm Shuang Esther Shan, your host here at Shopify Masters, your companion for starting and scaling your business. Did you know 82 % of South Asian Americans hop on a plane to shop for their wedding attire? Nikki and Ritika Shamdasani saw this and decided to do something about it. They raided their savings, won pitch competitions, and found angel investors to make Sani a reality.

0:47What started with 15 dresses has grown into a global fashion brand known for its eye-catching, yet contemporary designs rooted in Indian heritage. Nikki and Rithtika turned their passion into projects, becoming the first ever South Asian brand to hit Run the Runway in 2020. Rithtika, Nikki, welcome to the show. Thanks for having us. We're excited to be here. Thank you for having us. Yeah. Well, so excited to chat because I was just sharing how when I went to my first Indian wedding, my friend lent me all of her clothes. And I know that it's a common shopping problem where you're trying to go to an event, a wedding, and you are hoping to maybe travel back home and kind of piece together your wardrobe.

1:35But this was an opportunity for the both of you to start a business. So yeah, take us back to that moment where you thought this is an opportunity here. Yeah. So to take you back, we actually have to take you back a while. So because Sonny kind of started off as a side hustle for us. So we had both gone to our first Indian wedding after a couple of years here in the U.S. And when we were looking around, we were like, where do we find these clothes if everyone's just going back to India to shop? And that is what 80 % of South Asian Americans used to do. So initially, Sani started off as a way for us and our friends to have access to the clothing that we wish we always could find.

2:20So the first collection was 15 pieces, all in our sizes. In case we failed, we would just have clothes for days that Nikki and I designed and we sold it out of our parents' basement. And so I was actually in high school at the time. Nikki was living in New York and we both were like, this will be a good side hustle passion project. But slowly and slowly, we saw that a lot of people liked what we were doing. And then there was also this segment of actually non-South Asians going to their first Indian weddings coming to us increasingly. And they were like, hey, could you ever also do a rental option for this?

3:04And we were like, no, rental is like too complicated. We don't want to take that on ourselves. But that's when we started the gears turning and Sani started turning into more than a passion project because then later in February 2020, we launched as the first South Asian fashion brand on Brent the Runway, bringing people Indian wedding clothes for the first time. And that's really the moment when it turned from we might be doing something more than something that just stays in our parents' basement. Yeah. And what a scale up, right? That means you had to figure out manufacturing. And even before that, securing that partnership with Rent the Runway is so amazing.

3:47So yeah, Nikki, talk to us a little bit about the manufacturing side, getting ready for that partnership and scaling up. Yeah, that was really a matter of like, fake it until you make it. We had this manufacturer that we were working with that was great, but was doing pieces for us one off. And so when it came to suddenly scaling that up a lot more, that was difficult because there is a culture in India, really, of tailors and other small, small factories being able to kind of just make one off pieces for anyone. I think there's a huge made to order culture, as you know, from the time you've spent there and shopping for Indian weddings.

4:29And so when it came to figuring out manufacturing for this Rent the Runway order, it wasn't just how do we go from one piece to hundreds of pieces. It was also how do we make this rental friendly, which was another wrinkle that we didn't realize would be such a big part of the process. Rent the Runway at the end of the day is actually a dry cleaning business as we came to know. And so actually we had to modify a lot of our embroideries and textiles in order to make it work. Finally did. Thought we had given ourselves enough time to get the order done. And about two weeks before this order was slated to ship, we got pictures, what we thought were final pictures of the outfits.

5:20And it turned out that the pieces had been made in the wrong colors. And so we saw this picture on a Tuesday. I was on a plane to India on that Wednesday. So one day later. Oh, my goodness. It all worked out. We ended up getting it all right. But, you know, it was this amazing learning experience at the time did not feel like an amazing learning experience. Just felt like the most stressful thing in the world. But it was this amazing learning experience of figuring out quality control, figuring out systems so that you don't catch something like that just two weeks before. But we ended up being really proud of the product that we were able to deliver and really proud of the people we were working with as well.

6:13this learning curve and this scale up for the both of you again when you have you know some family connections where you're just working with a tailor to make one-offs then to scaling did the checklist for looking for a production partner change and what were you looking for when you're looking for someone new that could handle this big order now? So for us from the beginning, the first thing we looked for in even the one-off manufacturers was, are they a responsible manufacturing hub? And so that meant working conditions were good. That meant people were treated in an ethical way, paid well. So that was the first hurdle we had to jump over.

7:01When it came then, and that's continued to be a core part of what we look for in any manufacturer. The next step after that to scale up was finding the right export quality manufacturer. So the first person that we worked with was our grandmother's temple friend's son, who happened to have excess capacity, and he totally met the responsible manufacturing checklist. But when it came to export quality, he didn't necessarily have that because he was only making for the domestic Indian market. So from there, when we were finding new manufacturers, we were going for referrals as much as possible. And we didn't start with any other family connections and knowing kind of where to find those export quality factories.

7:56And so there were a lot of hit or miss instances. And we ended up kind of absorbing all of those mistakes through our D2C business. You know, we didn't have those orders go to Rent the Runway or to Nordstrom, who we ended up working with later. It was kind of testing it out with our D2C business. And so really what we started to look for was, are these manufacturers able to ship good quality products on time at a good price point? And someone told us that you're only going to get two out of the three at any given time. So know what you're willing to give up. And for us, it was, OK, if we need to, we'll have longer lead times, but at least we'll keep the good quality product at a great price point.

8:48And so it really became a matter of just telling everybody we knew that we were looking for these export quality manufacturers and then doing tests with every single one of them and seeing what the products were. Yeah, it sounds like there was a lot of moving pieces, especially with, you know, developing the relationship with Friends of Runway, finding the new production partners. And then also, Ristika, you were in high school and then university. I think that's also such an interesting part of the story because that also helped the funding journey in a way as well. So talk to us about initially getting grants and finding your own way of building up the financial foundation.

9:33Yeah. So kind of like what you said. So Nikki had been working for a little bit. She definitely poured her savings into Sani. And as a college kid, my savings were non-existent. So I poured nothing into it at the start. So obviously, like we had to find money because fashion is not a cheap industry to be in, continue to grow. So what we did is we ended up getting over$110 ,000 in non-dilutive funding. And that was all through pitch competitions and grants, either locally in North Carolina, where I went to school or ones that were nationwide. wide. And I think that is a big advantage to actually like being in college while running this business is you have access to these kinds of things.

10:21And a lot of people just don't know about it and don't know how to actually access it. But once you do, like there's a lot of resources at your fingertips while you're in college to be able to scale a business. And I think we were really lucky to have that because not only could we qualify for these kinds of things, but then I was going to school for fashion too. So then I had the resources of an entire fashion program at my fingertips too. So that was initially like we did a lot of non-dilutive funding. And then as the business kept growing, we did take on some venture investment, but it's also been a very small portion because we've tried to just grow the business through our profits.

11:00I think, you know, there's also such a big task of looking for those opportunities, be it grants or incubators or venture capital. So for that process, what's your advice for looking for those opportunities and adjusting your pitch and your story when you're approaching these different opportunities there? Yeah, I mean, I think you have to be a really good stalker for one, like, literally keep a pulse on everything that's going on. I did a pitch competition that was happening at this women's College. It was Smith College. Smith College. Yes, yes, yes. And it was the Draper competition. If you asked me like where Smith College was before I even found this competition, I would be like, I have no idea what you're talking about.

11:47And that ended up being$25 ,000.

11:55So I think keeping a pulse on every single college's entrepreneurship programs is really, really important. And then also connecting with your own. Like I'm lucky enough that my school did have a great entrepreneurship program. So I got very, very close to anyone that was working there because the minute something was available and posted, it would be, I'm applying to it right now. And I think in terms of like, even tailoring the pitch, right? Like all of them do have different focuses, but I think what was so amazing about our brand is there's so many ways you can look at it, right? Like we could really hone in on the whole like fashion manufacturing side of things that they were interested in and how we're doing it in a more responsible way.

12:37So we were able to also go for the more like sustainable, responsible competitions. And then there was the whole like doing something with culture that was a great angle for us as well. So really playing into I think angles and accordingly, like what each one of the competitions was looking for from their angles? The only thing I would add is there are a lot of local grants, usually even beyond college. So a portion of that$110 ,000 in non-dilutive funding was from, for us, an organization called NC Idea, which helps fund North Carolina businesses. And you don't have to be in college, it can be at any stage.

13:19So I think for anyone, there are probably local opportunities, whether at the college level, the state level, the county level, and we would just look for as many of those as we could. Amazing. Because to both your points, you know, funding was important because you needed to invest in inventory. And I think that also comes with so much complexity. You've got to understand forecasting, what designs would actually come with demand. So how did you approach that side of planning and logistics? I mean, we haven't mastered it. I can't give you a step by step. Like I wish we had a better understanding of it because we're still learning new stuff every day.

14:03I think the overarching thing though, is we always start with low order quantities. And that's just because as much as we both have really strong guts on like, this product is going to do amazing. Like I really, really, really believe in it. Half the time they're wrong and it's the product you didn't think would do amazing that really takes off. So the only way we've learned to like really protect ourselves is to honestly start with like 50 units of a product, see how that goes and then reorder. And that also comes from the perspective of as much as we won in non-diluted funding and the little bit we've taken on in venture money, like we aren't at a place where we've raised$5 million to where we could really like explore with like a 200 minimum order because half of these factories are taking like an upfront and then you have to pay the goods as soon as it delivers.

14:58So we're having to be really specific about how we order things. And with that, we're just ordering low quantities. Yeah, that's a very tactical and good solid advice because that's something that you can always adjust as demand comes in. So as the business was growing, Nikki, for you, at what stage were you kind of more comfortable to say, like, I am going all in, being an entrepreneur and kind of stepping away from the corporate career? Yeah. So I left my job at a startup accelerator pretty early on. So that was kind of my last full-time job. And as Sani was starting up, including as a side project, I was taking on consulting and freelance gigs wherever I could.

15:48So I will say at the start, I was provided with the flexibility of other gigs where I could sort of work around what Sani needed. But it was in 2022 that I actually went full, full time with Sonny. And for us, it was a matter of how much is this taking away from the growth of the business, like me doing other things. And it came to a point where we really felt confident that if I could put extra energy into X, and for us, that was like partnerships and wholesale, then we would be able to make up for what I needed to take on in a salary. And so it probably took us longer than it should have for me to say I'm going fully full time with this, but we just weren't in a position or I wasn't in a position where I could step away knowing or not knowing how much I would be able to make as a salary.

16:50And even now, you know, we pour the majority of everything back into the business. But even to get to that meets my minimum income expenses level, that was the time when we knew we could really, really get there, even if it meant a few months of extra stress before that of, okay, I've quit my job. I haven't fully, or I've quit my freelance and consulting gigs. We haven't fully made up for it with Sani, but we know we're about to get there. Yeah. Yeah. Taking calculated risk when you're making that decision is so important. Previously, we mentioned the iconic relationship with Rent the Runway. And I understand that actually came from reaching out cold and sending out a message to the team.

17:35So what's both your advice for kind of approaching a partner like that and sending an email? We are the biggest proponents of sending cold emails as much as you possibly can. And this did come from a cold email. And specifically, I was given the advice at the time of if you send a cold email from a school email, so.edu, the chances of getting reply are even higher. And I wasn't a student at the time. It just so happens that one of my part-time gigs was at UNC Chapel Hill, where I went to undergrad. And so I happened to have a unc.edu email. And so ended up sending an email to Jen Hyman, the CEO of Rent the Runway.

18:21And obviously, it wasn't just about sending the cold email. It was also about make the pitch in the right way. And we ended up posing it as this is how big the South Asian wedding market is in the U.S. and nobody's really serving that right now.

18:47And in addition to that, here are actual screenshots from customers of ours saying, can you provide a rental option? So it was kind of that top down, this is what the market looks like and bottom up. We have demand that we need to fill right now as a part of the pitch. So, of course, it's about the message, too, right? Not just I need something from you. Like, oh, it'll make us look so good if we're on Rent the Runway. but here's what we think the opportunity is for Rent the Runway. And that obviously also speaks to CEOs like Jen, who are incredible and respond to emails, because I think it's, she must be inundated with thousands of emails a day.

19:32But you never know, right, when a cold email is going to catch someone's eye. They happen to be looking through their email at that very moment. You just never know when it's going to land. And so we are the biggest proponents of every day, every week, if you can, like keep a running list of the people you'd want to cold email and every day try and send at least one because you're increasing your shots on goal. And that's really how you increase your surface area for luck in general. Yeah. And I feel like we sometimes need that story to bring back the optimism of pitching and cold emailing. And I love that the message was thoughtfully put together because it is based on the feedback that you've collected from your customer.

20:17So then maybe Ritka, you can share about, I guess, advice there, right? Like seeking out great customer feedback and maybe collecting those ideas from the community to change the way that you're running the business. Yeah. So the way that we started actually having a two-way connection with our customers was through TikTok. And in February of 2020, you probably noticed the month, we launched on Rent the Runway, sold out within 48 hours. A couple of weeks later, Indian weddings were no longer happening. So Nikki and I actually went into survival mode. And we were like, how do we keep this business alive until maybe this COVID thing goes away?

20:59And obviously, we know the COVID thing really didn't go away that quickly. But what did come from that was us starting to take social media more seriously and specifically TikTok. And on TikTok, we were posting not just the pretty pictures of the brand worn by models. We were actually posting how it is being a founder, the whole sister relationship, the behind the scenes. And I think once people got an insight into like the authentic side of Sani, they felt more comfortable actually responding back to us and like creating a connection in which they can tell us things like, hey, why don't you try this?

21:39Hey, I would love to see X, Y, and Z. But honestly, before that platform, we barely had a connection with our customer. And I think once we really took it seriously, that's when it started coming in. And obviously now we get that from more than just TikTok. We have that on Instagram. But I think the thing that really set it off was showing people behind the scenes of the company, not just the perfect every day. Yeah. And it has that feeling of like mini series, almost like insider look, reality TV feel. What's your advice today for new founders who are trying to achieve that kind of feeling or just building up a community today?

22:20I mean, I think the advice is kind of like you're saying, like treat it like your own personal TV show and think about like what you would want each episode to be? What are the themes of the TV show? Like maybe think of specific buckets that you want your content to fall in. Like maybe it's the founder bucket. Maybe it's the bucket of like being sisters, or maybe it's the bucket of really loving fashion and try and do content in each one of those buckets and see what does the best. And then keep going at the one that really does the best like every single day. I know as a founder, it's really hard to do that on top of running a business and keeping a business afloat.

22:59So the advice I would say around that is build it into your everyday to where it almost doesn't feel like you're taking the time to film. Instead, it's being filmed while you're doing stuff. And so that's been really helpful for us recently, too, to be able to make more of an effort to film the everyday moments because people actually do care about that. And it also makes your life easier. And that is absolutely the strategy that I recommend. I agree with that too. I think the biggest thing though, is like, just post the first one, just post one, and then think about all of the strategy as well.

23:39Because so many of the founders that we talk to wanting to do this, there's, it feels like there's so much inertia required to get to that first one and then you never post it and then nothing ever happens. So I think just like with a business, it's take some step, no matter how small it is, with the founder led content and the brand building through short form videos and everything. It's just do the first one. The rest is going to come. You're going to learn from every single one, just post your first TikTok or reel or whatever it might be. Love that approach for TikTok and your content. And I think that's also evolved as did your business.

24:20You've expanded into loungewear and now you're thinking about product expansion in the lens of a destination wedding. Talk to us about that approach. Yeah. So I would say the first product expansion of loungewear came out of just necessity. It was 2020. We couldn't sell Indian wedding wear. We We were like, what can we do that everyone's into right now and that we can sell? And that's where loungewear came about. We started off with four colors and the colors were inspired by an Indian wedding event called a Sangeet. Like it was the color palette you traditionally see at a lot of those events.

24:56And then it had embroidery on it, which obviously we know India is known for their embroidery. So that was honestly just a product expansion that came out of need. And because that product expansion did so well, it kind of opened our eyes to what Sonny could become and how we didn't need to just niche down in this like Indian wedding wear attire only market. So that was the start of the product expansion. Now we are looking at it as everything you would pack for a destination wedding, because for us, we want our customer to just have to worry about their suitcase. and we want to be there for their getting ready outfit, for their lounging outfit, for their airport outfit, for their day outfit, and then ultimately also still their evening outfit.

25:43So the way we're thinking about that is with smaller drops and also like smaller, more curated collections, but where each piece really, really has a purpose and there's also a multifunctional component to it. So you'll definitely see that a lot in fall 2025, where the story is literally a girl can take this entire collection and go to a destination wedding and not have to worry about anything. So that's where we're leaning into. And that really did start with just the necessity from loungewear to listening to our customers to now we're here and we know the business can evolve to more than just what we started with.

26:24Yeah. And that's such a easy concept for a customer to visualize as well. And it's so easy to follow along. But of course, like behind the scenes, there's a multitude of complexities to add in those product categories. So Nikki, when you're thinking about the backend, also the logistics of this expansion, what's your advice for kind of determining and prepping a founder when they're thinking about expanding their product lines? Oh, that is a big question. For us, probably one of the first things was, how do we knock it out of the park for products that we don't have as much familiarity with? What does that require?

27:08Who does that require? And so for us, that ended up meaning something like, you know, find an amazing technical designer, which we now do have, and make sure they're on board. It meant find factories that are really good at more technical, complex garments, make sure they can knock it out of the park. So for us, the start was, how do we make an amazing product, regardless of now the fact that we're going into casual dresses, and we've never done that before, we're going into this thing or that thing. I think it really starts with that product. And then it was, what is going to be the story that makes it make sense for us to exist in this way?

27:58Why should people shop with us? And again, that good product is table stakes, but what is the story surrounding it? And what are the things that we can be doing now to start to pull that together? And that was down to even what will a campaign that we're really proud of look like? Okay, it has this video component and it's telling this type of story. And we're going to have really good editorial images because up until now we were doing, focusing way more on the slightly more boring e-commerce photos. But, you know, how do we make someone visualize their life in these clothes in a much better way?

28:39So I think for us, the two things were product and storytelling. Great product and storytelling that gives a reason for our brand to exist in a customer's closet. Yeah. Well, the expansion and all of the new product launches are very exciting. And I love how Sonia has grown over the years. Um, I think what else is interesting for the listeners is that your family is also very open to entrepreneurship and you grew up around it. I guess like maybe it was easier for the both of you to embrace entrepreneurship, but what's your advice for some people who might be a bit more risk averse and how do you kind of balance yourself out at the end of the day when you're dealing with all those new challenges?