By Sarah Darrow
Photos: Stephanie Zhang
Being stuck in a job or college major that you don’t like can be brutal. Maybe you’re teaching math when you’d rather be a baker. Maybe you’re taking engineering classes when your true passion lies in music industry. Or maybe you are working a 9 to 5 in corporate finance and you didn’t even like studying it in the first place. Sam Sisakhti is no stranger to that. After working a mere four days in a corporate finance job, he called it quits. It wasn’t for nothing though: he is now the successful founder of the largest independent fashion website, UsTrendy.com. Taking finance and entrepreneurship classes during his undergraduate career at Brandeis University, however, might have paid off in the long run. Sisakhti gave us a lot of helpful tips about becoming a successful entrepreneur while also explaining how he got to where he is today.
The initial idea for UsTrendy came after a trip to Las Vegas. After quitting his job and feeling unsure of his future, he took a trip to Vegas and met up with his friend who was living in Los Angeles. Unfortunately, his aspiring fashion designer friend had literally become a broke and starving artist. After hearing about the difficulties that come with making it as a fashion designer, Sisakhti thought of the idea to “start a business to try and help independent fashion designers basically reach consumers with their products.”
After telling us about his initial idea, Sisakhti proceeded to give us some tips and advice about how to be a smart entrepreneur.
1.) “When you’re coming up with your business idea, try to make it big enough within an industry that is very scalable.” A lot of investors look at your plan and want to know if it will eventually become a billion dollar business. “The way investors actually work is that they’ll invest in 10 companies and they’ll assume that seven will fail and they’ll lose their money, two will kind of break even, and then one will be a home run,” Sisakhti informed us. “Investors are just swinging for the fences.”
2.) “Pick an industry where the idea can change.” Sisakhti’s initial idea was a crowd sourcing website where people could vote on fashion and the company would produce the top ranking clothing. Clearly, his idea evolved and it didn’t hurt to be working in an industry that is full of constant changes.
3.) “Find a co-founder.” Don’t, however, make the same mistake that Sisakhti did when he picked a co-founder. “I basically told all of my friends my idea and the one that didn’t laugh at me was the one who I was like, ‘hey why don’t you be my co-founder?’” Unfortunately, his co-founder quit after six months, which he told us about later. “Try to find someone that complements you. So if you’re really good at marketing, try to find somebody that’s good at operations and finance.”
4.) “Write a business plan.” There’s a lot of thought behind a business plan. You might think that you have to keep updating it, but based on Sam’s experience of meeting with 100 investors, no one read even read it–the most use it got was as a coaster at one meeting. Although it is not the most read-over document you’ll compose, he still advocates for creating one, “I think you should write it as an exercise to get your ideas out there.”
5.) Make it pitch perfect. “What the investors really look at is your pitch. This is maybe seven to eight slides and a one page executive summary.” Most importantly he added is that “you want to show the best things first.” Since investors tend to have short attention spans and are busy with phone calls, you want to catch their attention early on.
6.) You have to be able to deal with the social stigma of being an entrepreneur. “To this day, if people don’t know what the website is, they’re like ‘oh, so you’re unemployed?’ You don’t think about it, but all of your friends are on a totally different path. They’re trying to become an analyst, an associate, a VP. It can kind of be a lonely place and that’s where [having a] co-founder can kind of help.”
So after Sam had an idea, a co-founder and a business plan, he had to raise money. To do this, he could either borrow from friends and family, raise money through an “angel,” which is essentially “someone [who has experience] that has made money and can put $50,000-200,000 into a business and help you out,” or through venture capitalism. Sam had to borrow from family and eventually received a large amount of funding through venture capitalism. “That’s when you get one million dollars or more. That’s what I wanted, more for validity. The best way to get meetings with a venture capitalist, however, is through referrals.” After hearing more about his road to success, he continued to give us helpful tips.
7.) Don’t meet with your favorite investor first. “You want your first couple of meetings to be like practice ones. A lot of [venture capitalists] will ask you the same questions over and over again, so it’s good to get some practice.” So Sam and his co-founder booked meetings, but they didn’t all go smoothly. “I had someone tell me they wouldn’t even give me a dollar to put in the company.” Then we finally had a good meeting, and afterwards we sent flowers.
8.) Don’t send flowers after an investor meeting! After Sam and his co-founder finally had a good meeting with an investor, they decided to send flowers. “They thought I wanted more than their money apparently. They were completely sketched out, [thinking] why would you send flowers?” The moral of that story is pretty clear.
9.) Try to devote an equal amount of time to running the business and raising money. As you begin to have more meetings with investors, it can become tempting to want to raise as much money as possible. You still have a business to think about maintaining though. “What happens is, if you do have a second meeting with an investor and you’ve made no progress with the business, they’re going to think you’ve made no progress.” Although it can be challenging to balance both, it is worth the time and effort to make sure you do.
10.) Don’t count the dollars until they’re actually in the account. After Sam and his partner found out they had an interested investor, they couldn’t be more excited. A lot of investors never say no. The last thing they want is to say no to a business that ends up turning out to be as successful as Pinterest. Ultimately, however, the investors didn’t give them the funding. “Until the money is in the bank, [an investor] can pull out.”
11.) Be comfortable with being uncomfortable. “If you have a high level of anxiety, I wouldn’t recommend this lifestyle.” This piece of advice is something that Sam had to learn the hard way. “One day, I walked into the office and all of [my co-founder’s] stuff was gone. So he basically just quit. I haven’t seen him since that day actually.” He also added, “you’ve got to be able to take rejection…if someone doesn’t like you, they don’t like you. Move on.”
After his best friend and co-founder abruptly quit, Sam was at a loss for what to do, so he packed his things and moved to Silicon Valley in California. “[Silicon Valley] is like the Hollywood for business people. Literally every waiter or waitress has a business plan in their pocket.” While living in California, he met with 100 investors, all of who said no to his idea. “I think the Starbucks guy has me beat at 164. I met him actually and he told me.” After about a year and a half of rejection, he moved back to Boston and gave himself three more months to see if his plan would work out. “I got into Inc. Magazine and I sent it to Tim Draper, who is actually the biggest investor in the world.” Fortunately for Sam, “[Draper] was sitting next to Heidi Klum at New York Fashion Week when he got my email, so it was just perfect timing. He showed it to her, she liked it, and I got the final meeting.” This brought Sam to his next pieces of advice.
12.) You’ve got nothing to lose. “I just went into [the meeting] and was like, ‘listen I don’t need your money. I’m going to do this with or without your money. If you give me your money, I’ll just do it faster.’” This attitude is what got him a one million dollar investment from Tim Draper.
13.) Use your investment money wisely. “There are two strategies once you get the money.” The first strategy involves people trying to use the money quickly and trying to make a lot of progress in three to six months. From there, they try to raise a lot of money. However, Sam informed us that this strategy is “really tricky and really dangerous. Investors will tell you to reach a certain level of visitors or make a certain amount of revenue and they will give you more money. But nothing is guaranteed.” The second approach is to look at your investment as all of money you have to build your business. Fortunately for Sam, this strategy worked.
Two years ago, Sam Sisakhti received one million dollars to create a successful business. UsTrendy is now making 15-20 million dollars in sales, “which is unheard of for a company that only raised one million.” There are about 15,000 designers selling half a million products on the website and UsTrendy has incredible partnerships with a lot of the major international fashion weeks. They’ve even had shows in London Fashion Week and been featured in documentaries.
When discussing his plans for the future of this UsTrendy, he “wants to make this business the end-all and be-all for fashion designers. So if you’re a fashion designer, you’re on the website. And if you’re a consumer, I want to change the way people shop online and personalize the shopping experience.”
After Sam shared his story with us, he opened the floor to any questions. During this time, we learned that his starving fashion designer friend is doing better now and made a transition to the music but will be returning to fashion design. He also pointed out, “There’s a lot more ways to make money than starting a business, so make sure you’re passionate about it.” This is something that is important to remember, no matter what field you are going into.
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