the bossbabe podcast - 243. How To Get Started As An Investor with Pocket Sun

Episode Date: August 23, 2022

Investing is one of the biggest ways to build wealth and support companies you truly believe in. But how do you get started investing?  Our friend and go-to financial expert, Pocket Sun, is here to answer that question + lay out exactly what you need to do if you want to start investing – today. Get ready to take notes as Pocket lays out the specific avenues and expected timelines required to earn 30X, 50X, even 200X on your investment. Listen now! Highlights: Why investing matters – for yourself and your business. What you can do today to start investing in companies you care about. Links: Instagram: @pocketysun Angel Investment Training — fempire.iamgoal.com Follow: bossbabe: @bossbabe.inc Danielle Canty: @daniellecanty

but public markets versus investing in VC, you can't do anything with it until like say seven to 10 years later. But the cool thing is with VC, you get to really see with VC, you get to really see the behind the scenes on a variety of companies that could become the future Facebook, Airbnb, Uber, like these companies that everyone knows about. So it really gives you the chance to see the future in a way. Like you get to see how the future of billion dollar businesses are built from the very early stage. And that is something to really brag about. Imagine if you can say, oh, I was an early investor in say Bumble. That's now a public company that just puts you in a different league and it gives you so many

opportunities in your professional career as well. A boss babe is unapologetically ambitious and paves the way for herself and other women to rise, keep going and fighting on. She is on a mission to be her best self in all areas. It's just believing in yourself. Confidently stepping outside her comfort zone to create her own vision of success. Hello and welcome back to the Boss Babe podcast, the place where we share with you the real behind the scenes of building successful businesses, achieving peak performance and learning how to balance it all. I'm Danielle Canty, Boss Babe co-founder and president, and also your host for today's episode. One thing I'm really passionate about is women building wealth. And an amazing way to build your own wealth is to start a business. And another great way of building wealth is to have equity in someone

else's business. And that's what we're actually talking about today with the founder of SoGal, which is a VC firm, Pocket Sun. So Pocket and I met a few years ago. She's actually been on the podcast before as well. And she has a VC firm with her co-founder, Elizabeth. And they really want to be investing in specifically women-founded businesses. And I came across them and they really taught me to understand how I could shape the next

generation with the investments that I chose to make. And they made me a much more conscious investor, but actually that conscious investing has reaped amazing benefits. So this is going to be a great podcast for you if you're thinking about, okay, I have some spare capital that I want to invest in. I'm looking at all of my options. And this is a great introductory podcast into how you can invest your money to create wealth for yourself. This is really aimed at the investing side of things. Other podcasts that we've done with Pocket have been about raising money as an entrepreneur, which you spoke about as well. But this one specifically is about how you can diversify your portfolio, how you can invest in companies that you actually care about, and how we can actually, as women, support more women

by choosing VC firms that actually specialize in seeking out women-owned businesses. Because still right now, it's actually dropped below 2% of capital in the US goes to women founders, which is honestly, in my opinion, disgraceful and something that we get to change together. So enjoy this episode. Enjoy the education process that comes with it. And I would love for you to tag myself at Danielle Canty with any of your takeaways. And if you want to be put in contact with Pocket, you can find her on LinkedIn. And you can also find her on Instagram as well. Because I know a lot of you listening to this you want to be put in contact with pocket you can find her on linkedin and you can also find her on instagram as well because i know a lot of you listening to this are going to be really inspired to find out next steps to work with her pocket welcome back to the boss babe podcast this is not your first time here and I'm so

excited to have you back on. Thank you. I'm excited to be back. So last time we spoke a little bit about investing and how as an entrepreneur you could raise money. And this time we're kind of flipping it around a little bit because I know a lot of women listening to this may actually find themselves now already in a position where they have some expendable income and they're looking at, okay, what do I do with this money? How do I save money? How do I invest money? And looking at pensions 401ks and also something that might be exploring is investing in companies. Even if you're not at this point yet, I also think it's really important to understand this world a little bit more because it's actually a great way

to build wealth. And we get to build wealth by burning our own companies, but we also get to build wealth by investing in another amazing entrepreneur. So let's just open this conversation talking about like why you think it's important that women understand what investing means and how to pick their investments. Yes, this is literally my favorite topic. So I think my mission is really to open the door and have more women walk through into the world of investing. I think investing is the best way and you could argue the only way to build generational wealth. I think that's something we are not taught at

school because you don't get really rich by making a salary. And I think what we should be focusing on is the income that just comes in when you are sleeping, like that you don't have to be actively putting in hours to get. So that's what I call, I guess, passive, passive income, but also like income after you sleep, I think is a better way to understand it. So at Sogao, a lot of what we do is really about getting women to be owners of the next big thing. And as you said, it could come in very different shapes and forms. It could be you starting your own company and becoming an equity holder of your own company, but it could also be you joining an early stage startup and becoming an equity

holder that way. Or it could be you are an angel investor or a venture capitalist, or you are in some kind of investing capacity and becoming a shareholder in a company. And it could also be that you serve as an advisor or some other types of equity owning experts for the company. So that could also give you this kind of income after you sleep. And these are really long-term ways of building wealth, but it pays off very well in the long run. I love that because I do think depending on what background you are from, for me personally, like not coming from a wealthy background, like this was never taught in schools. It was never spoken about really until I moved to LA, even as a young professional in UK being a chiropractor, no one was talking to me about potentially investing in other people's businesses

and having equity and what that would actually mean. So I want to just like start and dive in a little bit more, like what are the types and the different ways let's break those down a little bit more that you can become an investor into someone as this company because I know some people are going to be listening to this and be like hang on rewind what do I do how do I get equity at other people's companies so let's start with maybe like the simplest form which is kind of like angel I would maybe say say from my, I would say like, no, it's not like the simplest to do, but it's like the one maybe people see happening the most often. Yeah. So I am not an expert on investing across the entire spectrum, but I am an expert on investing in startups,

especially in the very early stage. So as you said, there are multiple ways to get in angels are a common way. Um, so being an angel investor, meaning you are investing your own money, uh, and you're investing in very early stage companies and taking a small share of their equity. And maybe you are a value add investor. Maybe you're not, you're just a passive financial investor. That's okay too. But being an angel investor is an awesome way to not only build wealth, but really get you a front row seat on what is happening in the, you know, the latest technologies, innovations, and what are the, you know, the creations of the future that could become a huge business in the, say, 10 years from now. So I think being an angel brings in multiple benefits. It could make you really a trendsetter. Like my favorite thing of being a startup investor is a few years later, you see the company you invested in when they were a two-person team and had nothing, no product, no revenue, no website, no logo whatsoever. But a few years later, you see them all over the place. You see

them in the subway, you see them at Target, you see them at Sephora or whatever. That is an amazing feeling. And I also see angel investing as an amazing way to practice your feminism values. I think startups are the hope of our society. They represent change. They represent a possibility of breaking the status quo. And especially in the world we live in now, when things are changing in unpredictable directions all the time, angel investing really gives you a way to vote with your dollars and you can express your values with your money so i think last time when we chatted i talked about how money is energy where it flows how it flows really is important and i think that's something we need to think about

like not only when it comes to where you invest your money but also where you spend your money in general are you supporting women's businesses? Are you supporting, you know, people of colors businesses, or are you just feeding money back into the big corporates that are owned by the same group of people? So I really think startups creates this amazing wide space for, for people to play in. And currently I think about 30% of angel investors are women. And that is already much bigger than the percentage of women

who are in venture capital. But still, there's a lot of room to grow in the US alone. There are like millions and millions of households in the US that are qualified as accredited investors. But only, I think, 2% of those families, those individuals, are actually doing any kind of angel investing. So most people are investing.

What does being an accredited investor mean? Do you want to share? Yeah. So in the US, the SEC says that you need to be an accredited investor to do angel investing. And you could get qualified in multiple ways. One is if your income surpasses, I think 200,000 in the past three years or two years, or with your spouse collectively, you make 300 K and above for two years. So that's one way through the income. And then another way is through your net worth. I think the threshold is a million and that doesn't include your primary residence, but there are other ways. And this is where most people don't know. So you could get qualified by being a knowledgeable employee. So if you work at a startup or if you are already an entrepreneur or if you work in technology, et cetera, like you could qualify as a knowledgeable employee and become an accredited investor. And there is another way you can literally take a test and become accredited. consolidation thing is really a way to quote unquote protect ordinary investors because

angel investing is a high risk, long-term illiquid type of investment, but it is also a very high returning asset class. So when, you know, most people are blocked off from being able to make these kinds of investments, they are also blocked off from making real returns on their uh on their money so most people when they invest in public markets or mutual funds etfs like funds etc their target returns are like somewhere like below 10% or like a little above 10%. That is usually the range that most people get access to. But angel investing VCs, like the IRR, like the return rate annually could be like 20%, 30% or like even higher.

So if you're not getting access to that, that means your portfolio is not really being optimized and your overall portfolio's returns will be impacted because you don't have a high running asset class that is creating the majority of the returns for you. So I've made it part of my mission to really get more women into the world of startup investing because it's so fun and it doesn't require that much to start. I started with $1,000 into a deal on a platform called AngelList. And then I kind of grew from there. And you can grow very quickly and build a portfolio in, I'd say, anywhere from like

one to three years. So it should be more accessible, but currently it's not. And I think that's the thing. It's like having these conversations makes it accessible. And what we want you guys listening to understand from this is not that we're advising, yes, 100% go and do some angel investing, but hey, have this on your radar. So when you're in a position you are qualified to, it's actually an option that you do consider to help you build wealth. Let's just land or ground that example of angel list. You started with $1,000 in angel list. Do you know what that's worth roughly now? So when it comes to angel investing,

it really is about building a diversified portfolio, or at least that's what we advocate for. Because angel investing, as I said, it's a long-term investment, it's high risk, but it also could be high returns. But as a super early startup, and many of the listeners are entrepreneurs, so you know the failure rate is really high.

So it's important that you invest in a bucket of different companies so that some could be returning really well for you and some might not be returning that well for you. So some companies might die and you lose that part of the investment. But when a company really becomes an outlier winner, it could return your money like 20 X, 30 X, 50 X that could make up for all your losses. So that is the math behind angel investing. So I would suggest at least have 10 companies. And instead of say, investing 50K into one company, you could invest 5K into 10 companies or even 1K into 50 companies so that you can really learn what it is about and what kind of companies tend to do well. And what is it that you like about a company? So I want to come back to deal flow with regards to angel investing soon and talk about how you find these, but I also just want to cover the other types and different ways that you can invest to gain equity in companies. So can you give us some other examples? So angel

is a great starting example. What about others? Yes. So deal flow can come from everywhere. I think the key is for you to insert yourself into that world. So when we do this angel investing training program called Vampire by SoGal, we really encourage people to put that on their LinkedIn, that they are an angel investor or they are trained by Vampire by SoGal. Like when you put angel investor on your LinkedIn profile, magic could happen. Like entrepreneurs are very, you know, resourceful and they're very hungry and hustling. So they could find you and just start, you know, reaching out to you via your LinkedIn messages and, or Twitter and start telling you about their businesses. But there are a lot of ways to get

started. We all are part of some networks, right? Like it could be your university. It could be your, a sit you're in a city, right? Or you are part of some professional networks. So these are all great ways to, you know, get started right away. Um, so you could start kind of just kind of sending the message into the universe. Like I want to start investing. Like I want to understand how angel investing works, you know, what is out there for me. And I'm sure like as an entrepreneur, you will know at least one or five more entrepreneurs around you. If not, you really should find that community, but like investing into, you know, people that you trust, investing into people that, you know, you know, the capabilities of, or, you know, you have

just a great instinct for, and just start talking to them and start asking questions about their businesses. If you learn about, Oh, someone that you know of that you, you know, respect or someone that you look up to or whatever is starting a business, just start getting really curious and start asking, you know, like you could just go in with an investor mindset, which is super, super important. Always think about how do I become an equity shareholder in something? Uh, how do I, you know, benefit in the long-term success of something instead of, you know, if you're an influencer, instead of thinking about a one-time advertising revenue on your account, if this is a young company and you believe in this company

and you personally would be a loyal customer of the company, ask them, like, can I be, can we start a more long-term relationship? And instead of paying me in just cash, you can pay me like say half cash and half in equity, right? A lot of startups don't have a lot of cash to begin with and they might really love this offer. So with that, you could start literally investing without money.

So that is something I really think a lot of women don't know about. So whether you are a PR professional or you're a coach, you are, say, an accountant or a lawyer, you can use your expertise to help these young companies and become a small equity holder in these companies. Let's take a quick pause to talk about my new favorite all-in-one platform, Kajabi. You know I've been singing their praises lately because they have helped our business run so much smoother and with way less complexity, which I love. Not to mention our team couldn't be happier because now everything is in one place, so it makes collecting data, creating pages, collecting payment, all the things so much simpler. One of our mottos at boss babe is simplify to amplify and kajabi has really helped us do that this year so of course i needed to share it here

with you it's the perfect time of year to do a bit of spring cleaning in your business you know get rid of the complexity and instead really focus on getting organized and making things as smooth as possible i definitely recommend kajabi to all of my clients and students so if you're listening and haven't checked out kajabi yet now is the perfect time to do so because they are offering boss babe listeners a 30-day free trial go to kajabi.com slash boss babe to claim your 30-day free trial that's kajabi.com slash boss babe i think that's so so important to realize and i think that's so, so important to realize. And I think that's a big thing that again, if you are an influencer listening to this,

or you have, like you say, that expertise that you can bring to the table, like that is a value to a lot of new and fresh companies. So I'm really glad that you just highlighted that. So there's this angel aspect of it, which like you say, is giving your own cash to a company in exchange for getting equity. Let's say you were going to promote for them. You could, like you say, negotiate that as part of equity, or there's that other point where you're advising them. So let's say you have a certain expertise, which they would need versus them paying you to share that expertise. Again, you can switch those for shares. So they're all kind of forms of angel investing in kind of different ways, whether it's your time or your money. Let's talk about SoGal

and being a VC fund and what that actually means as an investor, like how you can become part of a VC fund. Because, you know, in all honesty, until I came to LA, until I met you, this was really alien to me. I didn't know that any person, like as long as they're accredited, could become part and input into a VC fund. So let's talk about what is VC? What does it mean? What do you do at Sogar? Let's like break that down a little bit more. Yes. So VC is like the institutional way of investing in startups. So as an angel, you control your own money, right? You do whatever you want. You could build a portfolio or you don't have to, you can just invest in one company a year and be happy with that. That's okay. But with a VC fund, we

are managing other people's capital. So that means we need to be responsible and liable for, you know, creates a balanced portfolio. But it's really about, you know, as fund managers, as VCs, it's all about investing within the thesis we have communicated with our investors. So it's like we paint the picture and we color that picture as planned. So with VCs, we need to be more disciplined. We need to, you know, do exactly as what we outlined to our investors. So for us, particularly, we invest in very early stage companies. So pre-seed and seed stage companies. And with a VC, you, it's all about outliers. So as I said, when you do angel investing,

you want to invest in a diversified bucket of businesses. With VCs, it's also the case. But for each company, your expectation for its success should be really high. As a VC, you don't want to invest in something that is just going to return 5x or 10x. That is great, but considering the high failure rates of startup businesses, you need to make sure that the winners in your portfolio can win really big. So for example, our most successful company to date, its valuation grew by 240 times from 2017 to 2022. So that is the kind of outliers that really make or break a portfolio. So VCs are constantly looking for these really rare opportunities that could return your whole fund so we have a term

called unicorns uh which means privately owned companies that are valued at a billion dollars or above so yeah as a VC we're really you know discovering unicorns developing these unicorns and making sure that they're on a successful path. So let's talk about that a little bit more. Like some people, I always try and put myself in the shoes of the listener. And I know for me, what you said there was like this company doing 200 times, you know, where you went in and what I know a lot of people are like, what types of companies are these? So there's certain industries that do this because people are gonna be like, Oh, how do I create my own company like that? Or they're gonna be like, how do I

know to invest in these companies? So what types of companies are able and ability to in effectively five years, you know, 200 times their actual valuation? Yes. So not all types of businesses could get to those heights, right? So for example, some more labor intensive businesses, you know, a lot of women run like businesses that are a one woman show. And, you know, these are what we call lifestyle businesses, meaning, you know, you could create a really good lifestyle out of the business for yourself and maybe for a very small team. But what VCs are looking for are the kind of companies that will, you know, a hundred X from what it is now without

having to add a hundred X, the people were a hundred X, the costs. So we're looking for things that have amazing marginal value. So that means for example, software companies, right? It's you, like you built the software and you sell it to 10 clients versus you sell it to a thousand clients. Maybe you add, you know, a few customer service people, a few sales people, but you don't need to grow your team a hundred X tox in order to serve more clients. So that is the kind of businesses like tech enabled, really scalable businesses are the types that VCs like. So if it's a mom and pop shop or it's a legal firm or a coaching practice or a clinic down

the street, these are not the type of things that usually would grow into that scale. So we always look for, you know, an amazing idea, an amazing business model that is very scalable and a great founding team and high enough ceiling for this company to grow into a huge business a few years from now. People are understanding now what a venture capitalist firm does. How many, well, actually, this is a great question. How many companies do you basically invest in? Talk to us about how it works and people pulling their money into as a VC fund, how they deploy that and what the gains are for the individuals who invest. Yes. So I started my own venture capital

firm. So that makes me a fund manager. So basically I raise money from accredited investors and kind of communicate my plan to deploy this capital on their behalf. And venture capital is also a long-term asset class because a business from the time it's formed and getting the first infusion of capital to the time it exits, meaning, you know, it goes public or it gets acquired by a bigger company usually will take seven to 10 years. And sometimes it takes longer. So really we are the guardian of our investors capital and we deploy according to our plans that the investors feel excited about. And then when companies get to an exit, we have, you know, cash distributions back to the investors based on the amount. So usually I would say a good venture fund

could return, I'd say like three X or above in the overall fund life, but it doesn't comes in, you know, annual bonuses or anything like that. It really is more like you put in money today and maybe you put money kind of throughout the next two years, three years, because they don't, usually they don't need all your capital all at once, unless you are a very tiny investor in the fund. And then by year seven or year 10, you start to really get money back. And then maybe the majority of the returns don't come until like 10 years later so it really is an illiquid long-term investment but it could really pay off handsomely in the longer time frame what are the risk versus benefit of investing let's say in a VC fund versus like the

stock market like how does someone you know let's say with I don't know like 200,000 that they're looking to invest how do they decide whether I should be in the stock market or I should be in a VC fund so if 200k is all you have to invest I would say like the startup related like private equity venture capital, like all these alternative investments should be, I'd say maybe 20 to 30% of your portfolio. And that makes things a little tricky because a lot of VC funds wouldn't take investments under say like 500,000 or a hundred thousand or something like each fund has a different minimum, but for, you know, if you're like not too old and you can have, you know, you, you can take more

risks. I would suggest doing a little more in the alternative space. So these are the more high risk, but high return asset class. I think these assets classes not only build, you know, a potential high return for your overall portfolio, but usually you get to learn a lot more in these alternative investments. So investing in public markets is something that a lot of people, like most people would, you know, know to do also could take a lot of time. It's very liquid. Like you can sell this morning and buy this morning, sell tonight, the behind the scenes on a variety of companies that could become the future Facebook, Airbnb, Uber, like these companies that everyone knows about. So it really gives you the

chance to see the future in a way. You get to see how the future of billion-dollar businesses are built from the very early stage. And that is something to really brag about. Imagine if you can say, oh, I was an early investor in, say, Bumble. That's now a public company. That just puts you in a different league. And it gives you so many opportunities in your professional career as well. And investing in VC is also a great counterbalance to investing in public markets. So historically, venture capital performance and public market performance are very much not correlated. Currently, when the public markets are very not doing so well, people actually look more into the private markets,

and especially early stage, because that's when the hope is, that's where the hope is. And that that is where the future is, like the latest technologies, the latest innovations, the latest creations that could shape the future are starting in the very early stage. So yeah, I would say definitely do a little bit of both if possible and try to find venture capital funds that would take a smaller minimum because not all the funds do that. And another different thing is with venture capital, excess is everything. So even when you have money, like money is a commodity, right? How do you make sure that you get deal flow? You get into the deals that are competitive, you get into the best funds that is important versus in the public market. Anyone can invest into

Apple. Anyone can invest into Disney. Like there's no real restriction, but with venture capital, how, like how many deals you get to see in a year and what is the fund that you get to invest in? What is their performance? Like how much do you trust the fund managers behind the fund? These are things that are harder to come by. So a lot of women don't even get asked ever to be invited to invest in a venture capital fund. And that is because as a fund manager, we are restricted in many ways in how we can talk about our fund because we can only market to accredited investors. So we can't just blast out on Twitter. We're raising a fund. Like our minimum is this come invest with us. That cannot happen. And it could get us into trouble. So that's why all of these

things are happening more on the private level. And that also means a lot of women lose access because of it. If they're not really discoverable as an investor in the private level. And that also means a lot of women lose access because of it, if they're not really discoverable as an investor in the venture space. And I think this is like a great lesson in like, always talk about what you want to do. I think sometimes there's a stigma around women talking about money, but I think we can really encourage that here. Like, you know, if you are like, Hey, I have some savings and I'm really not sure the best way to like support those savings and growing it, just start having conversations with people and fact finding. And then you get introduced to people. Like I just got introduced to an amazing

woman, Erin, who's helping me with my stock portfolio and looking at my general wealth management. And then I met you via an introduction from a friend, which then allowed me to invest into SoGal because I'm an investor and you're a fund one. And it really is about having the conversations first of all, because once you have the conversations, you find yourself like actually entering those communities because then someone knows someone quite often. And I think that's the biggest mistake that we make around not actually talking about money openly and freely enough. And there's also no shame in being like, oh, you know what? I'm actually not at that stage yet. I'm actually at this stage. Can you point me in a direction of somewhere that I can go? And I just want to

break down that stigma of one talking about money and also feeling like, oh my God, I don't have enough money to talk about money. That's also the biggest mistake a lot of people make by not actually learning early enough. Because if I think if I had had these conversations when I was back in the UK as a chiropractor, I would have be in a better position than I am now because I would have invested differently. I wouldn't have lost an absolute shit ton of money because I wasn't educated well enough on diversifying my portfolio. No one was talking about this stuff. No one was like, I was like, Oh, I've got some money. Like must put it here. Like one person said something to me and that ended up costing me a lot of money. And I think it's just really important that we do talk more freely about it and having these

conversations about, okay, is angel right for me or as VC fund right for me or hang on a minute, not putting a hundred percent of my net worth into one place and actually put it in multiple different places and locations is part of it. And you don't really learn until you ask the question. So I just want everyone to like, listen to this and not feel silly if they don't know the answers. Like it's still a learning curve for me. I was even saying to you before, I'm like, okay, so I understand want everyone to like listen to this and not feel silly if they don't know the answers like it's still a learning curve for me I was even saying to you before I'm like okay so I understand VC I understand angel like what's private equity could anyone get in that or like there's all these questions that I don't know still because like this is a world that I'm not always in and I think when we start breaking down those barriers people are okay saying wait I don't

understand yet and I want to understand more versus oh I have to pretend I know everything straight out the gate because it's just not possible for us all to know that yeah yes that's a great point uh and my goal is really to make women feel at ease when it comes to investing and they should feel excited because when you're not investing like that is the biggest loss of all if you think about this money trap we've been in like as women all our lives when we were kids we just we get less investment from our families as women to get a good education and then you as women usually inherit less from your parents and when you're at school you are encouraged to take on the less paid majors so you study things that don't get you those high paying jobs after graduation you land those lower paying jobs and layering that with the gender pay gap, right? And you layer that with the fact that women have always been sold to by all these bigger brands, all the

consumerism is targeting women. So you are always feeling like you're not enough. You need to spend more to feel enough, to feel okay, to feel confident. So you're spending more and women are more likely to become caretakers for the family, for the kids, for the seniors. So you spend more money on other people and you don't invest the money that you have. By the end of it, women are, I don't know, just owning a fraction of what a man owns. And I see that all the time and it's really painful to see. And I also see a lot of women who are even CFOs at companies who are not making decisions for her whole household. So a lot of women are still giving up the entire financial control of the family to the man. And that happens all the time and it creates huge consequences.

And it also, you know, it doesn't help that financial advisors are like, I think 80% or more men and they treat women clients differently as well. Like they kind of do more of again, quote unquote, protecting of their female clients. So I've seen, you know, women investors wanting to invest in SoGal, but their financial advisors is like, oh, this is too risky. You should stay more in the safer investments, but that is making women lose out on the highest returning type of investments. But when a man wants to invest in something like SoGal, they pretty much just inform their financial advisors. I'm going to invest in SoGal, make it happen.

Women are sometimes like more likely to be deterred by people's advice around them and not feeling this confident from within that they can make their own decisions and really get into more adventurous and more interesting areas of investing. Let's talk a little bit about Sogal because we've touched on this a couple of times. I'm having a meeting or conversation with you a long time ago and you said something to me that really stood out to me. You're like, I don't invest in Facebook because I don't love them as a company or something along those lines. And it really like stood out to me because you are such a conscious investor. And honestly, at that point, it wasn't something that I had, I was in like say the stock market, et cetera. I had done some investments, but

I wasn't consciously choosing the companies that I was really wanting to get involved in and talk about that environmental economic change that I wanted to see. And that's why I ended up becoming an LP in Fund One of SoGal because I was so aligned with the types of businesses that you wanted to invest in. So I'd love for you to talk about like how you as an investor, that really can be the catalyst of change and why you will or won't actually invest in some companies. Yes, I think as an investor, we have disproportionate power in voting for the future. And traditionally, this voting was only done amongst white men. Because in the VC world, I think less than 10% of VCs are actually women. And majority, majority of the venture capital funding is controlled by

men and especially Caucasian men. And as a result, when I started SoGal, only 2.2% of venture capital funding went to women CEOs and in the past few years you know there was Me Too there was all these other things that raised awareness for gender equality and brought this into the investing world but in Q1 this the overall funding going to women dropped to 1.8% So it has been hovering around that 2% number and just couldn't get past that, which is really sad. So there's still so much to be done. And I call myself a really, an accidental investor or an accidental entrepreneur because it was not part of my plan to become a VC or to start my own VC firm but really I did it because I saw it as the most direct solution to the big problem that I discovered which is you know the fact that women and the rest of us are not really

funded or seen by the mainstream VCs and And I thought about how profound that impact is. Like if you think about in today's world, all the technologies, the big companies that we know about that we interact with on a daily basis, they were all invested by venture capitalists, pretty much all of them. So from like Uber to Peloton to Bumble to Facebook, you name it, like these are all funded by VCs. So VCs literally are voting with their dollars to determine what companies get the resources that they need to get to the next stage, to reach more customers, to become a bigger company and to really shape the future. And I think women have to be part of that decision-making. And so for me, I really love companies that are for us,

by us. And this is a category that only emerged in the past few years, I would say. And this really gets me going because just think about the whole world around us, how all the systems were built for and by a small group of powerful white men. and people of color's experiences, immigrants' experiences, or LGBTQ people's experiences. And this impact is profound in every way from government to city development to the healthcare system to the education system to the professional world to policymaking. like all of it could be improved for the rest of us. So I really see the rising of the rest of us being the largest trend of our lifetime. And I think that is a theme that I can invest in for my lifetime and still have advantage in it because these demographical changes are the longest to change and people are reluctant like discrimination and biases are very powerful and deeply rooted so i think investing is my mechanism for activism our fun is really a way to express our values. And I think our values are really aligned with Gen Z.

I think Gen Zs are pushing forward a lot of change when it comes to the demand for diversity, the demand for community, the demand for human-centric design, the demand for justice justice and equality and really a lot of grassroots activism. And Gen Z is the most diverse generation in U.S. history, period. So I think if we could direct our dollars into businesses that could really fit into that more inclusive, more diverse, more colorful future, this world will be such a better place. And with our fund one, we were also able to prove that you could also make top of the industry returns when you stick to your values, when you stick to the impact thesis that you have. So that is something amazing. And that's why I love my job and want to get everyone involved in something like this. What's crazy as well as like, you just kind of touched upon less than 2% of

funding VC funding is actually going to women owned businesses. Yet when you look at statistics, women owned businesses or businesses with a woman on the board outperform male-only boards. And I think that's what's really amazing. And that's what you're seeing the results of in your round or your fund exactly. Because are we able to give any of the companies that are in that fund one? Because I think a lot of people would have actually heard from them because they have blown up. So like, isn't it also what is really normal for a V at the age that your fund is? What is

normal for is it normal to have one unicorn in there? Or like, what is the normal stats? And maybe you can share like how yours is currently performing? Yeah, so unicorns are hard to come by and that's why they are called unicorns so i would say like our fund one has achieved a lot that most people would not even be able to achieve in like two funds or three funds our we can't publicly disclose performance specifically but i can share that our 2017 portfolio has already had two unicorns one is function of beauty uh a custom beauty today yeah so function of beauty was our first investment and our first unicorn and our second investment which became our second unicorn is Everly Well. It's now called Everly Health, but it is this at-home health testing platform that delivers affordable health tests to your door. So this concept became a lot more easy to understand after the pandemic because everyone

has done a COVID test at home before, but when we invested, it was not so much of a trend yet, but that company was able to grow tremendously well. And now you can have so many different types of tests on the platform. And another one that we're really proud of is called Love Every. So if any of the audience members are a new mom you probably have heard of it it's the of course we have a lot of bias but we think it's the best baby toy company ever it's been very fast growing since we invested in 2017 the cool thing is many of our founders ended up becoming our investors as well so So we really like that,

you know, founders can become investors, investors can become founders. Like if this becomes a self-sustaining great ecosystem where, you know, everyone is a shareholder, everyone is an owner in something and we can all grow our generational wealth that way. I think that's what's so special too. It's like then more women supporting women. And that's why I decided to go into your fund was because it felt like I was then supporting more women because you guys really look for women founders, minorities, and just really supporting communities that are not traditionally supported within VC world, unfortunately. And as a result of that, this fund has over-delivered on everyone's expectations as well as mine as like a investor and will continue to do so. And I think

it's even more powerful, you know, you're just talking about Everly Health and like the founder and CEO there, like having a baby and in between and like all of these things that just really support women, not only in their business, but also in their all of these things that just really support women, not only in their business, but also in their lives too. And that's why I'm, I just think it's really powerful to like, understand, like we start this conversation out around understanding that actually it's not just about investing, it's about creating change. And when you put your dollars into companies that you want to support, it actually has this positive ripple effect for the next generation. And I think that for me was something that was underrated before I met you.

I did not realize the power that I actually had in the dollars that I was investing or saving. And I think when more of us start realizing that as women, that's when we can actually demand and create change. I'm the same as you. I believe that entrepreneurs are the future of our societies. We're the companies that make the difference. We're the companies that can pivot fast. We're the companies that can demand more of ourselves and the people around us and whatever it is that we need to overcome in society, diversifying the wealth and having more wealth in women's hands, having more wealth in the hands of people of color too. That's what really makes that change. So I think it's just great that we get to now educate

all of ourselves on how we can actually make a difference and do better with where we spend our money. Yeah. And I think we're sitting on this opportunity of our lifetime that we can actually make a difference and do better with where we spend our money. Yeah. And I think we're sitting on this opportunity of our lifetime that we can be part of history and we could contribute to history in the making. Like, for example, last year, when Bumble went public, the founder, Whitney, became the youngest female CEO to take her company public. And then later in later last year, another company that's pretty young, like also went public. And it was the first time ever that a company that is founded by two women became public. And if you think about it, that is the first time in history of two women founded businesses, a business was able to go public.

Like just history is being made right now. And we are so lucky and excited to be part of that and be generating that better future where our future daughters could see different role models like that look like them that they can relate to which is a huge problem that we have today and we could see women succeed in different ways and you know and still have a life and be their whole selves a fun fact is in the past two years during the pandemic, we welcomed about 20 new babies to our portfolio, like founder family, just so many of our founders gave birth to their babies in the past two or three years. And we totally support that, You know, like it's, we support women founders as holistic human beings.

And we actually do a lot of healing work for them because, you know, when they're fundraising, when they're starting their businesses as a woman, or when they were growing up as women, we all have experienced discrimination or unfair treatment in one way or another? And how do you turn that trauma or like pain to fuel you and to really feel wholesome and feel seen and feel healed so that you can, you know, go out and raise money grow your business make the best decisions with no pain or past trauma like holding you back so I think that is something we uniquely do and address as women investors investing in women entrepreneurs and I think this kind of you know kind of life is very important beyond just giving them a check I I love that. So true. So anyone

listening who really wants to get involved with either angel investing or VC and investing into a VC company, how can they find out more about you and SoGal? Yes. So I am on linkedin uh as pocket sun i am on instagram as pocket y sun so for people who are interested in angel investing check out vampire.iamsogal.com that's where we teach angel investing in a very comprehensive way and we also share deal opportunities so that you can co-invest with us. If you're interested in investing in venture capital funds, feel free to email me at pocket at sogalventures.com. And I would say, if not our fund, we know a lot of other women fund managers that are doing awesome things, investing in different sectors.

We invest in the future of living, working and staying healthy. But there are a lot of other women investors that are investing in food and beverage or supply chain or biotech or other interesting things. So I'm happy to also point you in different directions if you're interested in investing. And I would say VC funds would require, I'd say anywhere from 25K to like 500K as the minimum. Yeah, just think about how much capital

you have to deploy as an LP or as an angel. And I'm happy to support. I love that. Thank you so much, Pocket. This is amazing. We'll put all of your links too in the show notes so people can find out a little bit more when they are ready and when they're looking to invest. So thank you so, so much, Pocket.

This is amazing. And also, I'm really excited that you are also doing a masterclass for us within the society about actually with the shoe on the other foot. So if you are a entrepreneur and you're wanting to understand how to raise, you very kindly provided us with pitch templates and teaching how like the things that investors look for in businesses. So I know that's going to be invaluable to so many and that they can really take their dreams into a natural reality with your advice and support. So thank you.

Thank you so much. That's actually epic. And it's in there from September, I think it is, right? Or yeah, September. So depending on when you're listening to this, it's going to be in there right now or going to be in there in the next week or two. So thank you so much, Pocket, for all your support of Boss Babe, as always. Thank you. It's been a pleasure. Thank you so much for listening. And if you enjoyed this episode on the Boss Babe podcast,

then I'd absolutely love it if you leave us a review. As a thank you, we'll send you our side hustle success kit, your simple, no BS guide to keeping track of everything that you need to do to start and grow your business. To access this freebie, all you need to do is leave us a review, then share a screenshot of your review with contact at bossbabe.com and we'll send this must-have kit straight to your inbox.