Kendra Scott, founder of the eponymous jewelry startup, is encouraged about the future of entrepreneurship after appearing as a guest judge on "Shark Tank" this season.
"The American dream is still very much alive," Scott told Business Insider ahead of her appearance on the show, which is slated to run on October 23. "To see all of these vibrant, passionate, entrepreneurs is really something amazing to witness."
Scott is an optimist despite facing adversity throughout her career. She launched the jewelry business that shares her name in 2002, out of her spare bedroom with $500, and convinced local boutiques to carry her creations.
She opened her first store in 2010, on the heels of the Great Recession and a divorce. In 2016, she sold a minority stake of her startup to private equity firm Berkshire Partners at a $1 billion valuation. She was just one of four unicorns that year that had at least one female founder, according to Crunchbase.
Today, her company still sells jewelry and has expanded to home decor, such as candles and picture frames. What's more, she operates more than 100 stores across the US.
"I was in those shoes, but I'm 20-something years down the road," Scott says of her time scaling a business during an economic crisis. "There's a lot of opportunity for entrepreneurs to harness this time and come out even stronger than before."
Scott spoke with Business Insider and shared her advice for enduring the pandemic, fundraising, and how founders can protect their mental health.
Build the business first and fundraise later
In the early days of her company, a mentor advised Scott to focus on developing the startup before fundraising. He told her to build it right rather than focusing on the next steps.
Scott followed that guidance and didn't raise funding until 2014. If she had started searching for capital instead, she wouldn't have been paying attention to her business, she said.
"You have to focus on building an irresistible idea and doing something disruptive that stands against the marketplace or competitors," Scott said. "If you're doing what everybody else is doing, you've already failed."
Know your numbers
Any casual fan of Shark Tank knows the investors regularly tout the importance of knowing your numbers. Scott echoed that advice, noting that founders should hire a professional if they're not confident delving into the financial side of business.
What's more, entrepreneurs should understand their markets' competitive landscape, articulate what problems they're trying to solve, and how their companies are disruptive, Scott added.
Show your passion
When founders do approach investors, they have to be passionate and honest about their businesses, Scott said. Investors today are looking for authentic brands that solve problems and tell powerful stories, she added.
"If you're doing it just for the money, you're not going to stand out to investors," Scott said. "They need to know that you care deeply about what it is that you're doing."
Your identity is your strength
Many founders will walk into a room of investors and find they don't resemble the people at the table or have experienced different life circumstances, Scott said. For example, female founders may be the only women in the room — Scott was the only female guest judge on this season of "Shark Tank," she said.
"You look the way you look for a reason and have a unique fingerprint," Scott said. "All the things that you've gone through have made you the most amazing human."
Scott advises entrepreneurs to use their experiences to build companies and find strength. "We see things in our past that may have been difficult or the things that we've gone through that may have been tragic," she said. "We think those things make us weaker, but in actuality, they make us stronger."
Protect your mental health
Even before the pandemic, entrepreneurs were prone to burnout. Now, many founders are also balancing homeschooling and full-time care for their children, among other new responsibilities.
Scott advises business owners to find a little time in their days — even if it's only 10 or 15 minutes — for themselves. She likes to practice yoga and takes cues from her Apple watch to breathe. She also surrounds herself with people who support her, including parenting groups who can relate to what she's experiencing during the pandemic.
"There's nothing about being an entrepreneur that's easy," she said. "It's OK to ask for help if you're having an off day and let a friend lift you up."
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