Investor Spotlight: Andrew Montgomery, Partner at Collaborative Fund

18:06Hannah Dittman:How often are you meeting with a founder before an investment decision? You know, if I was an old high school friend and you were kind of giving me the rundown of what things look like in the inside scoop, what would you be telling me? Yeah, well, I think the best way even before the pitch process to meet VCs is through a warm intro, some connection. You know, there's lots of, I think with all the AI that's out there today, the volume of cold emails has just skyrocketed for everybody. So I think warm emails really help or some kind of hook. You know, we've got a huge portfolio and a huge network of co-investors.

18:38Hannah Dittman:And so I think, you know, with LinkedIn, you can really get a sense of who knows who and connect with people in an authentic way. Maybe it's on Twitter, maybe it's on LinkedIn, you know, whatever it might be, but connecting through a warm intro. And then I think the process, you know, in an ideal world, and there's a broad spectrum here, just given timeline sometimes, a diligence process could be one to three weeks. And, you know, we'll meet with the founder a handful of times, sort of the initial pitch, which I like to have 30 minutes. Some people schedule longer, some people like shorter, but, you know, to me, 30 minutes and really dive into founding a company is not.

19:08an easy thing. And I was talking to a new potential candidate today, a potential investment today. And the first thing I like to ask is why, if it is so hard to build a company, do you want to start this? Like why scratch this itch? What is compelling you to do this? And oftentimes people are leaving incredible jobs or opportunities. They've had success before in some way. So what is it that makes you want to leave that to start a company? And I love to understand that, just to understand what makes people tick and what will, when they hit speed bumps, will keep them driving through that. If they have a co-founder, like how do you guys work together?

19:40If you don't have a co-founder, who are you going to go to in those hard times or when things are going really well? And so, you know, the first 30 minutes is really to dive into that, the product, the brand. I love when founders send the deck ahead of time so I can be a little bit smarter to dive in, but then use it as a scaffolding and then we can just go from there. So after that first original process and happy to answer questions about that first meeting, typically it'll be a couple more calls or meetings in person. If it's an actual product, food especially, we want to try it. Like if it's not good, even if we're not the target market, if we're just like that is not for us or for the target market, then it's going to be really hard for us to get there on investment.

20:17So we definitely want to try the product. Understand distribution and how you're thinking about that. There's so many different ways to go to market. What's going to be authentic to that brand, to that founder? Where do we think there's sort of white space and opportunity? We'll do reference checks, whether that's with customers, people you've worked with in the past, pre-seed investors. And then ultimately it's about aligning on terms and sort of what does that structure look like that everybody's happy with and then marching to close. So it can be anywhere from a very compressed timeline of a week to a much longer.

20:45And maybe we've gotten to know an entrepreneur before in a prior business or even just when they started and they're not raising, but we want to get to know them six months in advance. So it can take a whole different form.

20:56Hannah Dittman:This is going to be a big question with a big ambiguous, lots of different answers, But just to kind of distill it down in a couple of tangibles, noting that, you know, there's a million things you're not going to say. What kind of makes every part of that go right and gives you momentum to get to the next step? So, you know, a couple, two or three things that would push you along that curve. So from the first reach out, X, Y, Z happens and that gets you excited for a first meeting. In the first meeting, you heard or saw X, Y, Z and that got you excited for the second meeting and so on and so forth.

21:27Yeah, great question. So the first thing that we look for is what was the source of the intro? Not that it has to be through a particular source, but I think, you know, somebody has figured out a way to get to us and also through somebody that we trust. Maybe it's the founder of Sweetgreen or maybe it's the founder of another company and they come through us. That's a filter. And so we look at that. But we've had lots of cold outreach as well. I think the thing that gets us excited at the start is what's the brand? And when we say the brand, we don't just mean what's the logo and the font and the color scheme.

21:57But like, what is every intentional and unintentional decision that's gone into that from the name to the design of the deck, how they've thought about who they've hired, who they've highlighted in the deck, who they've not, what's their target market. It's all of those things. It's even the way they write emails and sort of think about how fast they are to respond. You know, all of that is a reflection of brand. And then we'll also, like I said, sort of look at Reddit or on social media and just see how people are talking about it. Are there reviews in the app store? What are people saying about it?

22:26Have they included some of that commentary in the deck because they're proud of it? All of those things are indications to us, a brand beyond just, you know, look and feel. We love to try the products before we meet with somebody, as I said. So I would say brand is sort of what gets us excited. Also, the market, is it a huge market? You know, we love investing in pets and things like that and farmer's dog. And so it's, that's a massive category. Obviously lots of big tailwind behind that. So we look at market size and then we look at the founder, not just, you know, they don't have to have experience in that category necessarily.

22:59It helps. But we've invested in people who've come straight out of school and this is their first job. We've invested in people who aren't out of school and this is their first job. And we've invested in people who have multiple companies. But it's sort of what's their track record of success? What is their excitement and what is their edge to win? So maybe they're just this their first job, but maybe their family has some connection or maybe they have a big online following or maybe they have something else that gives them a unique hook or insight that others don't have or would be very hard to replicate.

23:27So I would say first it's the brand, then it's the market size, then it's the founder. And I think in the first meeting, you want to try to hit on all of those elements, but

23:37Hannah Dittman:don't go too deep, like leave enough so that there's a follow-up conversation so we can go like, let's talk go-to-market or let's talk retail strategy. Let's talk hiring. Who are you going to hire and how? And so we want to sort of hit on all those things. One thing we talk about internally, again, is sort of momentum begets momentum. And so does the founder, and we work with our founders as they go raise more money after us is what's the sort of drumbeat of progress and momentum during that fundraise so that you get people excited the more they dig in. So maybe you had a meeting and then at the end of the week, you know, you signed some retail partnership that you already knew was coming.

24:14You'd signed it two weeks ago, but you waited to sort of tease it. Or you had a big press announcement or a hire or, you know, an advisor come on. There's lots of different ways to sort of engineer that. But I think it is a really important skill because you're also going to use that with customers. So I think you want to figure out how you sort of have that drumbeat of excitement and momentum throughout the process.

24:33Hannah Dittman:That's really interesting little drip campaign of successful dating flex. So it sounds like whatever you're kind of seeing or alluding to in that first email and that first kind of beginning, you just want to keep bubbling that up and doubling down and expanding on those same exact pillars throughout the process. When you're reviewing a deck pre-first meeting, what is like the perfect version of a deck for you guys? How many slides? What information does it cover? What is the meet really focused on? How text-heavy or detail-heavy are the slides? Or how high level should they be? I think without having a physical example in front for somebody, what are some general guidelines you can give them for an A-plus grade on the assignment?

25:20Yeah, great question. I think there's lots of content about this online, but there's probably lots of different perspectives about it.

25:26Hannah Dittman:Oh, it's so different. I think that's part of the hard thing. It's like every firm you talk to, they've got their own desires. It's not like the school of investors where everyone comes out with the same ideas. Yeah, totally. So for me, I actually really like a deck that's probably 10 to 15 pages, 10 to 12, something in there, where there's enough that you're not ripping through pages in 30 minutes. Like, all right, and here we're on to this, and here we're on to this. but something that gives you enough so that an investor asks a question, you have something that you can present that shows that you've thought about it.

25:59You don't want to overrun with detail. And I think there's lots of great ways to have sort of minimal text, minimal numbers, but display a ton of information, a ton of thinking. That's very thoughtful because if you can't articulate it in a sentence or in one short compelling story, I think it's really hard to then, as you get more complicated and you're talking about the whole company, That's just a very hard process. And so part of what we're looking for is storytelling. Can somebody tell an authentic, quick story? And then we can ask follow-up to go down. But I'd say 12 pages to start. And I actually like, some investors don't like this.

26:32I actually like when a founder will present the slides on the screen because it's a little bit of a scaffolding for the conversation. I think it lets the founder be in the driver's seat a little bit more than like coming in, like, what do you want to talk about? I think it's nice when the founder comes in and says, I want to tell you about my business. I want to tell you why I started it, who's working on it. with me what the product is, why now? Oh, and here's why it's going to be a billion dollar outcome and sort of touch on those. If somebody then asks a question, you can say, you know what, I've got some great info.

26:59I'm going to follow up with that. So if you're going to go into unit economics, I think it's good to have a high level in there. But then you might have a data room that you follow up with this as, you know, other people have been asking about this. That's a great way to say, like, I'm talking to other people and here are some questions that they're asking and they're smart questions. So here's a really good answer that I've already pulled together. So I think it's a little bit up front. And then again, more of that teasing and that drip campaign.

27:22Hannah Dittman:That's really helpful. So you think it's preferred that a founder's leading the charge of the conversation. They're coming in like it's a board meeting almost where they've got their deck ready. Maybe they're not glued to it, but they're anchored on it. They're clearly the one in charge in the power seat and kind of running through the story of their business, I imagine, through the lens of momentum, traction, and the metrics that you would probably be the most excited about, and then anything else is kind of following later. How much time should they spend going into the nitty gritty of their product, their brand mission, kind of the more consumer selling points of what they're doing versus the business operations of what they're doing?

28:05If you think about that first phone call, I probably spread everything pretty evenly. and the way I like to do it. And again, every investor is different. I like to ask that sort of upfront 60 seconds to two minute. Tell me why you're, you want to do this, why you're so passionate about it. I often start a call with saying, I'm not shy with questions. So I'm going to, they start and then I start to ask questions. What I love is if I'm asking the questions in the right order and the deck is flowing from one side to the next, like, oh, I'm glad you asked that question. And then it's just the next slide.

28:33That's obviously like when you get into that flow. And I think it's nice if it's sort of, again, signals that you both might be thinking about the business and what the outcome is in the same way. Whereas if I ask a question and it's their 40th slide, we're sort of maybe already, you know, you can get there and do it smoothly, but you may be not speaking in the same way. And so I think, you know, sort of going through in that form or fashion is really, really helpful for me.

28:56Hannah Dittman:You know, a question that often needs to be addressed early on is what makes your brand different or, you know, what's your value proposition, things like that. Could you maybe give a more tangible example of a portfolio company that you think had a really strong answer to that question or a company you've met with or, you know, any tangible example where you can walk through, this is the ideal way I like to hear this or think about this. And these are the pillars that really matter for that answer. Yeah. Well, I'll give you two examples. But before I start, it's highly specific to each company.

29:28But the way that we think about it, yeah, like I said, it's very specific to each company, but some different ways you might look at it. We're investors in Bandit Running, which is one of the most powerful community-driven companies I've ever seen. I mean, the authenticity, the excitement, just the passion that the customers and particularly the members have for that brand, the fact that they go in real life to the stores, they run together, they run with the founders, they run with the employees. There is just such community alignment there that you can't fake it. That is core to their brand.

30:02And And the founders, Tim and Nick and Ardith, are just so tapped into that and so focused on it. And they put that above everything. I mean, honestly, they put it above everything. And so they had a lot of stats in there. Their pitch and what we talked about was how do you figure out, how do you tap into that community? How do you recreate it if you want to launch new categories or new SKUs? How do you think about it? And so looking at what is that sort of NPS score of the founders in different ways or the customers in different ways. And another one, we invested in a company called Rhythm Health, where I'm on the board, a seed round, and it's the easiest monthly at-home blood test.

30:36And the way we look at that one, I mean, the retention. And we got to know Robbie over a long period of time. And two things stood out to him in his pitch. One is the retention just get better and better and better as the company grew in a way that you don't typically see in consumer companies, which was really fascinating. And because we had a period of time where he wasn't raising, but we got to know him, we got to see that retention grow and sort of stick, which was really meaningful for us in terms of how we thought about the business. And then the other thing is we were all using it. We were all customers of it.

31:05And we actually gave him feedback in the pitch or in a follow-up and said, hey, the dashboard is awesome, but like, if you could do this, it would be really cool. And within one day, two days, he was turning around product feedback, not all of it, because sometimes he would say, you know, we've thought about that, but we don't want to do it for this reason. Or he says, that's actually a good idea. I'm going to implement that. And so it showcased So it's not just he listened to his customers. His customers clearly liked the product. He was open to feedback, but not feedback for the case of feedback.

31:33But he was willing to pick and choose which things he thought was really important and would resonate with everybody, not just a single customer. So I think in those two cases, really diving into the customer love was really important.

31:45Hannah Dittman:I think it's really helpful that you gave those examples because both of them happen to be company performance metrics. That makes them a big differentiator. And I think I just had a recent podcast episode where we kind of dived into the psychology of fundraising in this topic. And we have a newsletter coming out focused on the same thing where when you get that question as a brand founder, I think your knee jerk is to think immediately what you would tell your consumer about why your product is different, which is part of differentiation. But for an investor, it's the business operation side of the answer of that question.

32:18Hannah Dittman:So you're saying almost agnostic of the concept, which, of course, you guys are evaluating, but you're saying the NPS, the community driven reality is so important to us as investors. That's what's giving us conviction. And then you're saying it's the retention. It's how sticky this is with our consumers. That's what's giving us conviction. Not so much that, hey, we're the first at home blood test. You used to have to go to the doctors and like that's the novel to the consumer aspect of it. But for you, the conversation used to anchor on, of course, explaining that and getting that out of the way, but then moving on to, okay, and.

32:49Hannah Dittman:So I think that's a really great example and really, really helpful context as well. When you get to the part of the conversation, and maybe it's in the first meeting or maybe down the road, it would be helpful to understand when this subject should be broached. How does the structure of the ideal ask question look like? You know, can you model an example of what you expect that to be like? For instance, I'm looking for$500 ,000 for X, Y, and Z or at whatever valuation or how do you like that to be structured? Yeah, great question. I think it depends who you are asking money from. I think the best way to have the ask is to have a slide at the very back that says we're raising a range one to two, two to three, three to four, whatever the number that's right for you is.

33:29And then I wouldn't sort of address valuation on that slide. and the reason I'll get into that, but I think if you're pitching angels, it can be helpful to have a valuation in mind that says I'm raising a million dollars at a 10 million post-money valuation because I don't think angels necessarily wanna be in the business or having to go through the complexity of pricing the valuation. Some most certainly will, but I think a lot of angels who are gonna invest are gonna say, I'm gonna invest in you as a person. It could be at any valuation. That's sort of reasonable. So early rounds typically are mid-single-digit million post.

34:03And so I think it's helpful to speed the process along if you give them a number. With funds, I think you're better off not naming evaluation and saying, you know, we're looking for market dilution. And I think that will put something in the head of the VC and it will put something in the head of the founder of a Series A might be 20 % dilution. If it's lots of interest and you have multiple term sheets, it'll be less dilution. If you have one, it'll be that dilution or maybe a little bit more. But I think founders can get in a little bit of trouble if they put a number out there, because if they have high aspirations, I'm going to hear that and say, well, I can't hit my ownership.

34:38Also, I think the next round is going to be really hard to raise. If you raise something very high now and you sort of don't grow into it or you do, but the market has changed, it's just very hard to get that next round. And so, again, it's sort of you want to align those incentives.

34:51Hannah Dittman:So I think it's helpful to look at how much other people have raised. I don't think raising$5 million because your closest competitor raised$5 million is a good number, a good reason. But I think most people have a sense of like, what's that dilution? And again, there's so much writing out there of Carter, there's a bunch of great data analysis of like what's standard dilution for a seed, series A, series B. And so I think if you sort of, everybody starts along those lines, at least in the first conversation, that's the best way to do it. Very helpful and appreciate the candid and explicit feedback on that.

35:21Hannah Dittman:You know, you mentioned early on that a founder is a big portion of what you're evaluating early on, especially and obviously throughout the process. When you're evaluating a founder, what traits matter most to you? You know, what are you looking for? What signals leadership, communication or experience? Maybe through the lens of a rock star founder from your portfolio as an example, what stood out to you when you first met them and why? Great question. I mean, there's so many examples in our portfolio. Maybe I'll talk about Samir Mehta, Sean Cain, and Glenn Powell from Smash Kitchen. They're a unique combination for a host of reasons.

35:56But what I would say is, one thing we look for and one thing they brought is, I often talk about this internally, is there's an inevitability when the founder speaks. And it's not hubris or bravado or ego, but it is an inevitability of, I'm going to tell you the story of what I'm building, and I would love for you to be a part of it. And I want you to be excited about it. It's going to come to fruition, sort of whether or not you join us or not, but I'm making this my mission to succeed. And there's a way that they talk that's still humble. Like I'm going to hit bumps along the way, but I just know that this in my bones will exist in 10 years and I'm going to build a big company.

36:33So I think there's a way that people speak. And I don't have a good like, you can't describe it. It's just sort of like if you see it, you know, Samir and Sean have obviously built global brands in The Honest Company or in Jinx Dog Food. And so when they came to us and said, hey, we're launching Smash Kitchen to, you know, sort of redo the pantry aisle for mass consumers at organic, with organic products at mass affordable prices. We said, great, you guys have done this before. You've got the distribution. We dove in a lot more than that, but we looked at them and said, your backgrounds, obviously, you have the pattern recognition and relationships and understanding to do this.

37:08And then coupling that obviously with Glenn's sort of authenticity and excitement about the brand was sort of a home run situation for us, or at least what we thought was a good opportunity. Yeah.

37:17Hannah Dittman:Any other kind of like core pillars of personality traits or things that you look for? So the other things that we look for in addition to that inevitability, and this goes back a little bit to what I was talking about, the tangible and intangible decisions of the brand or intentional and unintentional decisions of a brand is how do they respond to emails? Are they responding quickly? Are they a good salesperson? Not salesy, but can they hire great people? Has the first employee been hired and are they a very impressive person? And if so, it means that they were able to sort of pull that person loose, probably from a very good opportunity.

37:49So there's hiring, there's selling, not just to the VCs, but also to customers. So we look for that.

37:55Hannah Dittman:Are they good fundraisers? Because usually we're not the last round of capital. Usually we're just the first of a few. And so can they sell to customers? Can they sell to investors? And can they sell to employees? Because that's going to be super, super important. And I think, again, the sort of drumbeat of excitement through that process sort of also shows that. Kind of pivoting onto a little bit more of broader thought leadership in this space, you know, CPG and consumer investing especially often comes in category waves, can be polarizing concept in itself. Is that how you're thinking about what types of companies you're looking at or are trends less relevant to you or sector focus?

38:32Hannah Dittman:How are you thinking about your portfolio architecture exposure and what categories you lean into in? Great question. Another question we ask internally a lot is what is niche today that could be mainstream in 10 years? And what we're trying to understand is what is a trend? What is an enduring durable trend or maybe a full consumer behavior shift versus what's a fad today? You know, we investing in lower sugar, enduring trend, South Beach diet, fad. You know, we're going through a lot of high protein diet changes today. It seems like there's lots of companies that are targeting high protein. I personally don't think that's a fad.

39:07I think that's an enduring change. With that said, I don't know that we should have protein in every single item. And so like when I see Starbucks putting protein in their phone, I think we're not investing in that category. So we want to be really careful of what we invest in from that perspective and make sure that things are enduring. You know, we were very fortunate to invest in the farmer's dog. The sort of core behavior shift that we invested in there was people are treating their dogs and pets like members of the family and like their kid. And actually, there's been some research recently.

39:37If you were facing harder times, you'd more likely pull back on your own spending on you versus you're spending on your pet. And so as we thought about, OK, human grade dog food, that seems like an enduring shift. Then also there were some really strong tailwinds from e-commerce. Pet ownership during COVID exploded. And so there were sort of natural tailwinds that we couldn't have foreseen, but sort of, I would say, shifted that. Helpful to farmer's dog.

40:01Hannah Dittman:I think that's a great way to package that sentiment. I spent a lot of time doing consumer survey work back in my consulting days and my due diligence. Worked at a due diligence shop. And yeah, we called it flash in the pan. Are we looking at a flash in the pan or are we looking at a long-term trend? And so I think that's like such the core question on the investing side of consumer, probably a little bit more so than on the founder side. even when you're evaluating these theses or trends that you're getting conviction in or coming up with, how much of that is a founder coming to you and explaining it to you versus you guys already have the thesis kind of built in mind and you're just kind of waiting for a founder to come along and scratch some of the itches that you have listed across the board?

40:47Sure. I think it's a bit of both, to be totally honest. I mean, in some cases, we might have a thesis of, for example, we invest in a category, what we call precision health. And what we mean by that is, you know, we're seed investors in Whoop, we're seed investors in Rhythm Health, in Loyal, which is a dog longevity company. But these areas where consumers can take control of their own health in certain ways, and it's less about, you know, FDA approved biotech, long investment cycles, and more like, what can consumers do to understand their health better and make more proactive decisions? And so that might be a broad thesis we have.

41:21And then when we see companies come in, we'll already have a little bit of a perspective on it. There are also going to be cases where we've invested in something where a founder brought it to us and we're like, we have never thought of that idea before. We've never even been close to it. And it is fascinating to us. But if you sort of think about our scaffolding of better for you, better for the world, we start to see where the villain test overlaps with some of those things. And so it's a bit of both in terms of we might have an overview, sort of a broad landscape view, but there's going to be specific things where a founder has been thinking about this for years or it's just so niche that it certainly never came out to us.

41:56Hannah Dittman:Yeah, that's always the most exciting thing. I think everyone loves those moments where you're learning something huge and you're like, wow, you feel like you're being sold to as the consumer for the first time almost where you're like, yeah, I would totally I would totally be in on that. You've kind of touched on a few through your portfolio, but what current changing consumer trends, habits, categories, maybe channels, price points, anything are you interested in right now and why and kind of looking forward to in your future investments? Yeah, I mean, I think there's a couple things that I would probably point to.

42:27One is distribution. You know, I think a lot of the retailers have gotten very sophisticated about bringing in new brands much earlier in their life cycle and testing them in different regions or different store formats. And so when we think about new companies, that may not be such a signal as it used to be of, oh, wow, you're in every single Whole Foods or you're in a region of Costco. That's still a huge signal, but it may not be quite the, OK, this is ready to scale to the mainstream. And so thinking about what is the unique edge on distribution? There's so many different channels now to reach consumers.

42:58People go through Air One. They could go through TalkShop. There's all different categories to understand that and think about that. So one way that we look at that is just what's the unique advantage that somebody might bring to distribution? And so we're thinking about that of how are people changing the playbook? And then let's go find companies that might be working differently. I think Rode and what they did, obviously, is a huge example. And then the second thing, you know, AI, we're looking at how is that going to impact consumer behavior? Every time you go through these sort of technology shifts, whether it was from computer or mobile or social, it really changes how people interact with their hardware or their data or just a product.

43:32And so what we're thinking about is how does that evolve in the consumer landscape? ChatGPT and Google are obviously huge consumer companies, but I think we've not even scratched the surface of what is to come and how will AI really change the software around consumers and all the data. And I think there's a huge opportunity in finance. And so really looking for companies in and around those categories that are thinking of what's that next step? What's that leap forward in terms of AI and how they're using it for consumers?

43:59Hannah Dittman:Very interesting. Great answers. As we come up on our last couple of minutes, I want to pivot to our last kind of case study question. As you know, Startup CPG has the largest Slack community in the industry with over 25 ,000 members. I'd love to pull a question directly from our channel and have you answer it as a case study for any founders out there that might have a similar question. The recent question is, when is a good time to start fundraising? A business needs capital from day one. We all know this is like a chicken and egg situation. So needing it doesn't really seem like the right answer.

44:29Hannah Dittman:How long should you try to bootstrap or find alternative funding before starting to try to raise? Everyone says, wait as long as possible. But what's a realistic answer to this? Great question. Lots has been written about this. Raise when you don't need the money. Raise when you do need the money. Raise at all times. Don't raise. A million opinions. A million opinions. I would say two things. One, I think the reason people say to wait to fundraise is one so you can maximize the valuation and the amount that you can raise and sort of show as much traction as possible. I think the other reason is to sort of align, again, what you're looking for.

45:04Do you want to raise angel money where you can keep control of the business for 20, 30, 40 years and sort of not be beholden to have an exit? That's one option. Or bootstrap it and then you can control your own destiny? Or do you want to take venture money and sort of sign that implicit contract, explicit contract that you're going to sell the company in five to 10 years or that's at least the goal. So I think really making sure before you even raise money, what is your goal for an outcome? I would go back to what I said before about having that drumbeat of momentum. I think the first round you raise from angels is going to be all from friends and family and people who trust you, who you've worked with, who you might have access to, who can say, you know what, I'm betting on you as a person and whatever you do, whether it's start X or start Y, I'm going to give you the money.

45:49So I think the question is really about venture funding. And I would say it's when you have enough traction and a drumbeat of momentum that you could reasonably go raise money. And also when you're like, I've burned the boats, I've left my other job. I'm like all in on this. If you haven't done that, I think it's really hard to go raise money because I think it signals at least to me that maybe you're not fully committed and that's a hard way to go into. So I would say, look forward at the next six months, 12 months and figure out when are you going to have a new product coming out that you could sort of meet with somebody right before and then give them the new product.

46:23Maybe you have a new distribution partnership, maybe a new co-man or, you know, lots of different things that you could look at to sort of drum that up. But yeah, our founders have gone through crazy processes ahead of time to figure out when's the right time to raise and, you know, sort of selling that momentum. But it's not an easy option for any founder. So I empathize with that.

46:41Hannah Dittman:What's your take on fundraising when you know you're going to be able to close the fundraise? Because it can be a huge, a time suck. And kind of to your point of momentum, it's like there needs to be some compelling narrative, not just from a brand story perspective, but from a business perspective in place for you to be able to get over the finish line, which I think can kind of dictate quite a lot about timing in your business. Yeah, the timing is really hard, especially because, you know, fundraisers could take six months. And so you've got to plan ahead far enough that you don't run out of money.

47:11Like if you're running out of money in a month, I think it's probably already too late. One, I think CPG companies can do a couple of things. They can demonstrate that they could have better margins in the future at higher volumes, but you could order a small volume that is sort of palatable today. Sign a key customer where you can then go to an investor or go to some kind of investor that could say, hey, I just need a million dollars or half a million dollars to fulfill this invoice that I have from somebody. So I think there are ways that you can sort of stagger when you actually need the cash to when you can get the cash and being pretty creative about that process.

47:44I think it's probably super important. It's a tightrope, high wire act that most founders have to do.

47:50Hannah Dittman:Very helpful feedback and really appreciate the examples. Before we wrap up, I just wanted to take a second to make sure our audience can have an actionable next step to apply all of this amazing knowledge to. For founders that want to get in touch with you, where can they find you or what is the best way for them to get into contact? And for operators looking to transition or other people that might be interested in a role working directly with Collab Fund or investing, same question. How can they get in touch with you or what advice do you have for them to follow along. Yeah, for me, I really appreciate you having me.

48:18It's been a blast to be on and thank you for asking all the good questions.

48:21Hannah Dittman:Yeah, thank you. To reach me, LinkedIn or email are the two best for me. Obviously, if you know anybody in touch, in common, feel free to send them my way, but andrew at collabfund.com. Awesome. Well, thank you so much for your time today, Andrew, and all the amazing insights and learnings. I'm sure a lot of people are going to find a lot of useful nuggets in this conversation. So thanks again. We really enjoyed having you. Awesome. Thank you, Hannah. Great to be here.

48:45Hannah Dittman:Thanks so much for tuning in, everyone. If you like this episode, show us some love with a five-star review at ratethispodcast.com slash startupcpg. I'm Hannah Dittman, podcast host and correspondent here at Startup CPG. I hope you'll join me again as we dig into more juicy topics like ops, finance, and all the real talk founders actually need. Come say hi on LinkedIn or ping me on Slack. I'm always eager to hear your questions or brainstorm future episode ideas. If you're a potential sponsor and want to get in on the fun and appear on the podcast, shoot us an email at partnerships at startupcpg.com and last but not least if you haven't already don't miss out on our free slack community for emerging brands and cpg lovers alike join us at startupcpg.com we'd love to have you see you next time