Welcome, my dear listeners to the Bigger Pockets Money Podcast, where we interview Sophia Amoruso and talk about how she built her first business, Nasty Gal, to astronomical success, how the business ended, and how she was able to reinvent herself in her new businesses. Hello, hello, hello. My name is Mindy Jensen and joining me today is my senior producer, Kailyn Hope Bennet. Hi Mindy. It’s so good to be here. Well, I’m here like every day, but just on camera this time.
It’s so good to have you in front of the camera this time. So, Kailyn, we have an awesome show today. Sophia Amoruso is the founder of Nasty Gal, and we are going to talk to her about the rise and ultimate bankruptcy of that business and how she pivoted to the new companies that she’s running today. We’re also going to talk about her groundbreaking book, Girlboss, and we’re going to cover a lot of other topics too.
Yes. Uh a lot of a lot of other topics in between. I think that this is a really special show for us. Sophia was definitely an inspiration for a lot of young women in, in my age group. And so, I think it’s really powerful that we have her on the show today where she’s actually going to tell her story about how this business functioned, what went wrong, what went right. I just, I think it’s going to be a really great show and some great learning moments for our audience today.
Yep. Seling on eBay, venture capital, we’ve got we’ve got so many things to discuss on the like meteoric rise of her company Nasty Gal, and it is a really, really fun episode. Without further ado, let’s bring in Sophia Amoruso. Sophia made her mark in 2006 as the founder of the fashion e-commerce phenomenon Nasty Gal, which she built to over $100 million in revenue. Sophia is also the best-selling author of Girlboss. She now runs an entrepreneur mentorship program called Business class and has her own venture capital fund called Trust Fund. Sophia, welcome to the Bigger Pockets Money podcast. I’m so excited to talk to you today.
I’m so excited to be here.
Let’s jump right into it. It’s the Bigger Pockets Money podcast. Let’s talk about money. What was your relationship with money like growing up?
We didn’t really talk about money a lot. I remember it being a a bit of a struggle. We grew up solidly middle class. Nobody taught me about money. I remember my dad telling me things like cash is king, and that’s, you know, and, you know, when I got my first job at Subway, it was like, you know, hustle and, you know, clean the floors and even when they’re clean, just keep, you know, keep working, like keep finding things to do. And that’s how you keep your job kind of a thing. I ended up being that kind of an employer in the beginning and that’s not how it works, especially with millennials. Uh, that’s a whole other story, but money was, you know, I I watched my parents file for chapter 11 actually. When when I was like, I don’t know what age, 10, and they I distinctly remember being in this like credit counselor’s office and watching them cut their credit cards in half and put them in a clear glass like fish bowl on top of like a whole bunch of other people’s credit cards that they had cut in half and put in the bowl. That’s a really weird memory for a kid.
That that must have been really hard. Did that sort of create any negative connotations with money or make money a really emotional topic for you and and through your adolescence?
Not really. I don’t think it really registered to me what was going on. Um but money wasn’t important to me. They’re I didn’t really want a lot of stuff. I remember wanting like Jinko jeans like you know, and they were like $80 and my mom was like, “I’m not buying you $80 jeans, that’s insane, you’re in middle school.” Which is pretty fair. You know? I think like $40 sunglasses were like a big deal. I just remember, you know, we were going to Mervin’s, which is basically Kohl’s, and it was like, you know, it was, you know, it was like, it was just very, you know, we were in Sacramento. It was like very solidly middle class, but I don’t remember it really messing with my concept of money. It was always nice to have a little but I never really cared about having much more than a little.
Which is so interesting because you grew such a big business, um which we’ll get to. But I think the thing that’s always struck me about you is you you have this innate ability to to pivot. Like if it’s ending of one business, moving to another. Um, what was there anything in your childhood that made you such a nimble entrepreneur that sort of influenced uh that way of thinking?
Yeah, I mean, both of my parents were, you could say they were entrepreneurs. My mom sold houses and my dad did home loans. And so they really only made money when they were getting work when he was closing deals, when she was closing deals. You know, my grandfather owned a piano shop, my dad’s dad owned a motel. He grew up on a motel with like seven kids. So, I think it was like kind of immigrant mentality from, you know, my the grandparents’ side and then my parents just ended up kind of, you know, they ate what they killed and there were good times and bad times. Um so I always watching them think on their toes a lot. In terms of my ability to pivot, I think there’s there’s it’s somewhere between ADD and survival. Um, and also just the fact that, right, if you lose your job for whatever reason, God forbid, you’re going to do something else. It’s called a pivot, right? I mean it’s not that unique. I’m just doing it in front of other people. And I get a lot of credit for it because it’s out in public. But I think it’s important for people remember that that’s what you, that’s just what you do, right? Like that’s what life does to you. A relationship ends, you pivot.
Um, but I’ve done it on a grand scale and I’ve and I’ve pivoted to really different things. I think being an only child and, you know, going to a lot of schools and sometimes playing referee for my parents, um not having another kid, you know, sibling to bounce things off of, forced me to operate independently and process things independently. Um, and then it, it was really beyond that it’s I think been somewhere between ADD and survival.
Yeah, that makes total sense. I think I’m not an only child, but I have a lot of friends who were and I think that kind of gives you like lone wolf syndrome where it’s really on you to to make everything happen. You really have to become your own counsel. And I think from, you know, following you over the years of reading your book and so on and so forth, I I really see that in your in your journey is that you you’ve kind of become the master of of having your own council whatever business you’ve decided to pursue.
Yeah. I mean, there’s no back stop for me. Like there was no my parents split up when I was 17. There was no home to go, you know, home to. My mom was running a really small place. Didn’t want to live with my dad. I moved out when I was 17. Uh and I wanted to. I just wanted to go kind of throw myself at life. And you know, little did I know that being inambitious and hating working for other people would somehow become this whole this massive business that I built and you know, becoming some representative for ambitious millennials. That’s the last thing I would have expected.
Well, let’s jump into Nasty Gal. I know you’ve told the story before, but can you give us a quick overview of how you founded it?
Yeah. I mean I, I didn’t consider it founding a company. I didn’t even consider it business. I thought business people carried briefcases around and like, you know, went to business school. I was, you know, my last job was in the lobby of an art school. I was sitting on eBay clicking through listings and getting Myspace requests, friend requests from eBay sellers who were promoting their eBay stores to other girls who looked like they might be customers. And clicked through and was like, oh my gosh, this stuff is so expensive. And I pretty much wore only vintage at the time. I wasn’t, I wanted to be a photographer, but I wasn’t a photographer. I wasn’t a stylist. I wasn’t a buyer. I wasn’t a business person, but I thought, okay, I’m going to go give this a shot. Let me see if I can just scrape together a little bit of money. And it was, it was fun. It was exhilarating even when things didn’t work. I learned and building Nasty Girl was a series of micro pivot, right? Like we’re pivoting every day when we’re learning. Something doesn’t sell, your description doesn’t, you know, your product description doesn’t land. Um, a customer’s not happy. You’re iterating, you’re pivoting every single day based on what you’re learning. at least if you’re paying attention and listening. So I did that over and over and over again. Um, the first year we did, we being me, you know, this is just selling vintage clothing on eBay. Uh, 70 like 2,000 in revenue, which was like insane. But again, I was paying 500 bucks a month rent. I had nothing to spend money on. So it was all in the business. It was profitable, but I didn’t know there was another any other way to build businesses. I didn’t know you could run a money losing business. I thought you all businesses make money, right?
Yeah, you bought things and then you sold them for more than you paid for them and you didn’t spend all. That’s the only way I could have built a business. I had no credit. And then year two was 250 grand, year three was 1.1 million, year four was six and a half, year five was 12, and we were on our way to 28 when investors came knocking. And this was, you know, just me and some kids in a warehouse. I hired a CEO for, you know, a portion of, you know, the, the that year where we were on our way to 28 million, but uh, it was a rocket ship.
Sophia, before we get to that massive success, I’d like to take just a step back and really hit the roots of Nasty Gal. Out of out of any other business you could have started, like why were you so attracted to vintage clothing and selling on eBay out of out of anything else?
I think we all start with what we have access understanding, money, um you know, experience. And so what I’ve learned it’s is that it’s not about what you have, because there’s people who had a have a lot more than me, who have better educations. There’s always going to be someone who has more than you. and it’s not about what you have, it’s about what you do with what you have. And what I had was a digital camera and access to thrift stores that was, you know, I didn’t know what trade shows were. Uh there was no Shopify or Squarespace or Etsy or stripe or cloud or slack or any of these tools. And eBay was the place I could do that. So it was kind of the only option and I didn’t sit there and think, wow, should I start an eBay store or should I open a physical vintage? I didn’t have like money, like startup capital to open a physical retail space. It was just by the sheer constraint of, you know, what I had, what I understood and what I was inspired by. And I loved vintage clothing and I loved style. Never cared about fashion, but I loved style.
And that’s what really, like, was the rocket chip that started to carry Nasty Gal was no one was styling clothes on eBay and making it look so cool and attractive and and exciting at the time. Like, I think that that was really the game-changing thing that set your business apart from other businesses.
Thanks. Yeah. I mean, it seems logical that you would put clothing on a person who looks like a person and start, you know, you can’t touch the clothing. so you take a t-shirt on a model, cut their head off with no context of you know, who they are, you know, culturally, their style and through Nasty Gal, I was able to kind of imbue in the photography and in the styling this aspirational woman that Mike, I wanted to be, my customers wanted to be, who was still relatable and approachable, but just one step ahead or maybe a little bit more confident. The models were pretty but they weren’t like, you know, they weren’t like alien runway models, right? They were normal cool girls that I paid with hamburgers.
And, that was, you know, a big part of it. And now, you know, styling, it’s it’s just everything looks like that. but Nasty Gal was the first to do that with e-commerce photography.
So what made you stop selling on eBay and open up your own website?
I’m kind of an angsty person. I don’t like rules and eBay gave me a great platform to start. But once I realized I had built a customer base who at that point was obsessed and I had built this pretty large my space following. I mean Facebook was hardly emerging at this time. Um you know, I was getting like slapped on the wrist for linking out to my my space page from my eBay listing templates and stuff that was just like, you know what, I’m driving more traffic to my listings on eBay than eBay is driving to my listings at this point. It was amazing, it was amazing marketplace for me to start where there were built in customers and discovery, which is what these platforms like Etsy and Fiverr do for us. But I realized I was building a brand and to really control that brand, I needed to put it on its own website and to give my customers the entire Nasty Gal experience. I wanted it to live off of eBay and just kind of overnight switched eBay off and turned on nasty girl vintage.com. Everything sold out. You know, I didn’t, it was a website with zero traffic, but I announced it and I had just editors, fashion editors, I don’t even know what that meant, who had been shopping with me and who where send out a dedicated email and daily candy at the time sent out like a dedicated email, which was like, people pay a lot of money for that. That was like, they were making money from advertisers. So I was, I don’t, I don’t want to say I was lucky because I had connections. I was like in the East Bay deep in Basha and a weird little warehouse by myself. Um but what I’d done had attracted some some people that had a platform and that was a big part of how Nasty Gal found its earliest success off of eBay and in addition to that, it was building an audience which is now what everyone is doing what everyone has to do. and I did it on my space. Um but now, you know, we have every other platform to do that with, but it’s also much more crowded.
When did you first learn about venture capital?
I didn’t know about venture capital until investors came knocking. They came inbound and I was getting emails from them. This was in probably 2011. I was still in the East Bay, we were in Emeryville. Um Bay Area, San Francisco area just across the bay from the city and had a warehouse with like, I don’t know what 12 kids, you know, it was like Osha violations all over the place. There was like a returns person and a couple shipping people and we had a little, you know, place where we shot in the corner and my IKEA desk felt really, you know, going to IKEA and like spending $500 was like so fun at that time. painted the office pink and it was, I don’t know how and I don’t know how they heard about Nastical. Usually it’s like their wives are shopping and they hear from some lady in their life like, oh my god, I obsessed with this. That’s how a lot of venture folks find these companies that are focused on women. And I didn’t really need anything from them. I didn’t know what to do with them. The company didn’t need money, it was profitable around that time. I saved a million dollars cash in the bank, and the Wells Fargo account. I actually have a screenshot of over $900,000 in the business bank account. And my personal account was also in Wills Fargo had like $8,500 and I had a credit limit of $2,500. Eventually, when I bought a nice car, I had to pay cash because I was invisible to the to the credit companies.
So you said investors came knocking. It doesn’t sound like you were seeking them out, they came to you. What were you hoping to get out of the relationship with the investors if you weren’t seeking them out in the first place?
I was curious.
You know, I was, it was a whole new world. I mean I lived in the Bay Area forever and I didn’t know what everybody in that city did. I was in, you know, working on Hate Street or at a photo lab and, you know, dancing at dive bars and subsisting on burritos. So I was curious and at that point, you know, I was like, okay, you want to invest? Like tell me what that’s about. What are we going to do? What would your expectations be? And, oh wow, I can sell 20% of my company for $50 million and still control it. That sounds like no sweat. Like what’s the downside here? So eventually decided to do that and even though you think nothing changed, a lot changed.
So you decided to take the investor, you signed the documents, they infused quite a bit of capital. It’s like $60 million is that correct?
Yeah, it was somewhere between 50 and 60 over two rounds in 2012.
So what happens next in the business? Were the investors helpful?
They were helpful, but also, you know, it was a a different time when e-commerce was like, you know, there was no playbook for it. We had to have a huge team of engineers to have an e-commerce website or a shopping app. It was so much work, right? There was like I said, there was no Shopify. So it was very expensive to build a business like that. So we were doing 28 million in revenue in 2012 and these experts came in and was like, oh my god, amazing. You’ve done this a bunch of times. I hired a chief operating officer and a head of finance and a chief people officer and said, okay, diagnose the business, tell us what needs to happen next. And we went from being a very profitable business in 2012 to a business that eventually was no longer profitable because we rouded up and we sat, I remember the board sat at a table and said, hm, what do we think we’ll do next year based on this trajectory? Okay, we’re at 28. Let’s shoot for a 128.
What? That’s crazy talk. Like for our audience, just to kind of give you some context, like reasonable business expectations are like maybe a 20% lift, like year over year. Like and that’s that could be pretty aggressive. Like I don’t even know what X that is. I didn’t know what I was signing up for. I mean that’s like 10 X I think. I’m still not gonna at math, but I think it’s next. And um we hired 100 people in a year and it was like the Tower of Babel where everyone was speaking different languages to one another and duplicating tasks and you know, there weren’t any operations for people to step into and, you know, processes for people, culture hadn’t really been built intentionally. So that was, so that was a mess. It was the most fun but the foundation of Nasty Girl wasn’t built on hiring a huge business or being a proper startup. It was like a bunch of kid, you know, a bunch of kids in a warehouse and, you know, money in the bank and cool, let’s buy some clothes.
I’m sure when you grow a business that exponentially, it’s it’s hard to manage your employees at that point. It’s it’s hard to manage investor expectations. Like, I think there’s so many wheels turning and I’m sure you as a very young CEO who’s incredibly um who who’s seeing all the success at this point is maybe internally freaking out. Like what what was going on internally at that point in time for you?
It was really challenging because I hired a bunch of C-level executives who had experienced longer than my entire lifespan at that point. And I said, okay, all right, step in, build this thing with me, tell me what needs to happen, hold yourself accountable because I thought that was what the grownups did because I never had to be told what to do in my business. And realized that even grownups need to be held accountable and even executives need to be held held accountable. and I thought they would go and do what they said they were going to do and have all of the solutions because, you know, at this point I’m paying them hundreds of thousands of dollars and it wasn’t that simple. Um, I was definitely in over my head. I didn’t know what I didn’t know. As cute of a story as it is that I bootstrapped this business to that big and started on eBay and wow, anybody can do something like that. I don’t recommend doing it as quickly as I did and if possible, I don’t recommend doing it with the lack of experience that I had. Um, I was very much at a disadvantage uh having not having had any experience literally working in an office or managing anybody or even experiencing leadership in a proper organization. Every office I’ve worked in, my name has been on the lease of and I was not qualified to be signing leases for, you know, maybe ever. I, I don’t, I don’t know, but we were growing so fast that I remember leaving like a wake of leases behind us that were like still that we were still paying for because the company was exploding.
Sophia, walk us through what happened next at Nasty Gal. So, you’re experiencing this colossal success and then the company ends up going bankrupt. What what did that look like?
Yeah. So that was four years later at the end of 2016 and when you raise on a $350 million valuation and even when your company is doing $100 million in revenue and venture capitalists who are the kind of people that set crazy valuations like that decide that fashion e-commerce isn’t as cool as it was in 2012 or maybe they just kind of want to stay away from it for now, or that, you know, $100 million even wasn’t enough for us to get to the next round where they could mark up their valuations and we were worth more, which looked good on paper to them. The expectation was that the next time we raised money would at a billion dollar valuation. and even at $100 million in revenue, that was a a wild multiple. And so I began to talk to more strategic investors who had, you know, built apparel businesses or private equity firms who would come in and maybe value the company at two and a half times revenue, which is still pretty great for any company. And my investors didn’t like that and even though I controlled the board, I took a lot of advice. And you know, the the story was basically, if you can’t pay $350 million, if that’s not the valuation you’re going to give the company, then it’s not going to work. And something that you sell is only worth what someone’s willing to pay for it. If it has to go on sale, like it has to go on sale. Um and that is not what my investors were interested in. And our ability to continue fundraising even when we were doing over $100 million in revenue was almost impossible. and I think in 2012 that really, I didn’t know what I was signing up for, but that was kind of the first nail in the coffin. And it was a series of Hail Mary’s at that point because those options went away and then it was even, then it was like, okay, well we have to take a lower valuation. We like have to. And my investors didn’t want to invest more money. They owned their 20%. They were happy with that. And when you have a business, it’s not a good signal when your existing investors don’t want to continue investing even just anything, just something nice that signals that okay, they believe that even though things aren’t going great right now, they still support you. Mine didn’t want to do that. And it was very, very hard for me to find investors because because of that. And eventually my investors said, okay, well, the only way we’ll do this is I’ll double whatever of your money you put into the company. And so it was either that in 2015 that the company, who knows what, possibly fall apart or I double down and put a lot of my money, $2 million back into Nasty Gal to try to save it, to turn that two back into whatever it was, a multiple of two. And at that point I was in way over, I mean so far over my head. I hired a CEO. so I was the chairman of the board. Again, I was like, okay, I’ve got a CFO, a CEO, a CTO, like a CMO, a chief creative officer, like there’s got to be a way to figure this out. My investors were finance guys. They had never operated businesses. That wasn’t where they were helpful. Um, as an investor, it’s, I’m a big value ad because I’ve operated businesses and I’ve been through the hardship and those are the kind of investors that I really value and as a founder, learned that I wanted to work with when I went on and built my second company Girlboss. So ultimately it was a series of Hail Mary. my investors me being like, holy shit, I just put a ton of my money into this business. I don’t know what to do with it. At that point, Girlboss, the book was this insane success. And it became what other people called a movement. I think it’s really weird to say that you started a movement and I don’t know, whatever. But it inspired a lot of women who had never seen someone start an eBay store and build anything as big as I had. It was a year after lean in. And there was so much interest in me personally and I didn’t know what to do with Nasty Gal, so I started spending more time on on Girlboss. I started a podcast called Girlboss Radio. I wrote two more books, Nasty Galaxy and the Girlboss workbook and left the company in the hands of grownups. At this point, I’m like 30 years old, right? Like I’m a grown up but, you know, I I knew at that point I knew what I didn’t know and it was everything I needed to turn a company around. And let’s see, and I remember distinctly it was in 2016, in November of 2016 that we had a board call, you know, we were out of options and said, okay, we have to file for chapter 11. We haven’t paid vendors in a month. We can’t keep doing that. We’re fiduciaries of this company. We have to do what’s most responsible for it. It was an incredibly hard decision. Um but after that much strife and layoffs and at that point, you know, even though girl boss was this massive success, it was there was bad press, toxic workplace culture. I had no idea what I was doing. And it was it was heartbreaking but it was also like wow, I put in 10 years and I did my best and this is the only like I’m out of this. That’s insane. And also kind of a relief as f-cked up as that sounds.
No, I I don’t think it does at all. That’s the first thing that came to my mind is that must have been a way of stress just completely off of you. And so for our audience, uh you sold your company to boohoo.com, correct? for like 20 million dollars and then you really turned all of your attention to what turned out to be a book and a media company called Girlboss and like you were saying this this book just caught wildfire. I remember being in the middle of Chicago, all my friends and I were big thrifters and everyone was like passing around this book. Everyone was like, you have to read this book about this girl. We became a Netflix show, like I just feel like everyone at that time was was reading your book and that became the true story here.
I mean it was, you know, there wasn’t it wasn’t a huge relief off my shoulders when Nasty Gal ended because there was, you know, a lot of bad press. You know, I was there was headlines like does does the failure of Nasty Gal mean millennials aren’t ready to lead? It’s like, oh my god, am I responsible for a generation? That’s insane. No. And the comments, you know, it’s like maybe she is an ask girl. Whatever. It was, it was endless. So there was yes, some relief and I mean, I’ve been through a divorce six, six months prior. It was, it was a lot at once. And it’d been two years since the book was written, there was a Netflix series being written about my life that about the book that Shirley’s there on was producing. And that came out in 2017 in April. So 4 months, 5 months after Nasty Gal basically fell apart.
If you could go back and do it again, what would you change?
I think I would have given the people who work for me more feedback before I gave up on them. I wasn’t in a position to coach them, which is what you want your leaders to do, even the executives, and I wasn’t capable of doing that. But when things didn’t go right, I wish I had given them more of an opportunity to do better because it’s very disruptive to an organization to just remove people. Uh which I I did a few times and it was at the expense of the greater business.
I think the big thing here is, like I said, you’re the queen of the pivot. You went from Nasty Gal to Girlboss and you pivoted again into other businesses.
Yeah. So business class is now what I’m doing trust fund, which is my venture fund and after all of this hardship and incredible fun and so much learning, I just want to pass it on. Like that’s kind of the best and highest thing you can do is not it is when you’ve extracted so much value um, and knowledge and a network is be able to pass it along and it be like no sweat, which whether it’s educating people about entrepreneurship in business class or investing in startup founders or building companies actually for other founders. That’s what I’m investing in. It’s the best feeling because I don’t really like building companies, but I know what it looks like and I can totally help. Um and I love supporting founders. So, it’s interesting being in this different phase in my life after being an entrepreneur for so long, no longer I am but business class is a tiny bootstrap business that’s, you know, hosted on Kibi and build technology and, you know, trust fund is is a business, it’s a venture fund, but not building a huge organization and chasing revenue in the way that, you know, we had to at Nasty Gal.
From your experience owning a venture capital funded business, are you doing anything differently now that you have your own venture capital fund called Trust Fund?
Yeah. So when I invest, I make sure that neither I am investing in a valuation that is going to put the founder in some kind of valuation purgatory that is way, way, way too high. Um, and that I’m not investing in something that is too expensive. And there was a while where that was happening. There’s been a big correction and the founders starting companies in this time in a downturn are here for the right reasons and their they know that it’s going to be tough and they know that finding funding is going to be tough and their expectations are much more in line with what the market should look like and is. With Trust fund, my inventory is my relationships and my experience and my talent with building brands and my ability to access deals and make a material impact on these companies and work with these founders on everything from getting them a piece in Tech Crunch, which I’ve done twice in the last month, just cold emailing editors. um, to referring the CEO of a huge fashion brand to one of my companies who’s still in beta and now his creative team is like in the beta of plot which was the first check I wrote out of the fund. So it’s so fun just to see what I can harvest for other people um, instead of say, okay, well we’re going to do brand partnerships and we’re going to do a conference and like that is a different kind of inventory when you’re working with brands. You’re selling something different. The value exchange between the people who invest in me and the the portfolio founders that I work with is just kind of the pure channeling of what I’ve built over 15 years and that’s not something I intended to build and it’s plenty of it it cost me plenty of trauma and money and all kinds of stuff. So I’m using it for other people and it’s what I really enjoy doing.
I I love to hear that. Are there certain businesses, like or business types that you’re looking to invest in? Like are are you looking for forward thinking things? I think I saw something online that you invested in an AI company.
Yeah, I’ve invested in two AI companies. One’s called Browse AI and they’re already profitable. They were profitable when I invested, and they didn’t raise an absurd valuation, but they continue to explode. So I’m investing in anything that helps founders start and build companies or helps people become entrepreneurs. So browse AI, you can basically scrape any page on the internet and it will update you when that changes. So it creates Google alerts for the entire internet, which as an entrepreneur, I’ve reversed engineered everything. I’ve had to go, you know, troll LinkedIn to see if someone quit or had layoffs or who used to work here and now you can set up these automations with browse AI super easily, uh to do that. Another company I invested in is called Pacsmith, which is a logistics platform for e-commerce retailers. It’s literally people called Pacsmiths in their homes, packing and shipping goods for the for the e-commerce retailer. so they’re not doing it themselves, but also they’re able to have their products in different states so that it’s much cheaper and faster for those products to get to their customers which is really cool. You know, a project management platform for creatives, plot, I invested in, um, a marketplace for dental workers to find shift-based work in dental offices, um and fill in shifts and for dentists to fill in shifts, like they’re they get to work for themselves, right? Like for me that is the same as the framework that eBay gave me to work for myself and the flexibility it gave me. So I see that as a product that also helps people become entrepreneurs. So it’s pretty broad but I understand the psychology of the person using those products, which allows me to really help uh the founders that I’m investing in and and have the heads and on of the people that they’re building for.
That’s so cool. I I love I love it. I I can’t wait to check all of those businesses out.
Sophia, what advice would you give someone starting today in the e-commerce space?
I think it’s important to have something differentiated. I think just creating other people’s products is tough. We did that at Nascal and it became more competitive. Other people had access to the same products in trade shows. We started making our own products which was very expensive. So make sure that what you’re building is something that is can be profitable um or is profitable from the beginning unless you’re creating some kind of newfangled product that requires, you know, development and, you know, prototyping and, you know, really capital intensive stuff, you may need to raise money or invest your own money up front uh to get to a place where you can sell that product. But you can also with whether it’s something you’re sewing at home or something you’re thinking about investing $5,000 and having a prototype made of, talk to customers, people who would be customers. So whether it’s a deck or a, you know, a, you know, a drawing, you can put it in front of people and say what do you think about this? Would you use it? And go through a lot of user interviews um and people might say, I’ve already seen something like that, or what about this? Make sure that what you’re doing addresses their questions so that when you put that product in front of them and when you message it, you’ve already filled those gaps for them and you’re making it really easy for them to show up and buy and use what it is that you have to offer.
Sophia, I think that that’s really sound excellent advice for our audience. We just really want to thank you for your time today. It’s been just really great getting to know you and I guess learning about all of the behind the scenes of what happened at Nasty Gal and really getting some valuable business information for our audience today. Uh if people want to learn more about you or follow business class or trust fund, where can they do that?
Yeah, it’s trustfund.vc. You know, the course I teach is businessclass.co and then I’m just Sophia Amoruso with an A M O R U S O pretty much everywhere, so.
Awesome. Sophia, this was so much fun. Thank you so much for your time today and we’ll talk to you soon. Okay, thank you.
All right, Caitlyn, that was Sophia Maruzo and that was awesome. I loved hearing the story of how this company just kept making money and just kept making money. and then all of a sudden, these guys with lots and lots of money knocked on her door and were like, “Hey, you want some more?” Like what a fun position to be in. and I can totally see why she would take that money. When somebody gives you $60 million, what do you say? Ah, no thanks. I’m good.
I I agree and I think as a, she was so young at that point, I think that that she did a really good job sharing of how stressful of a position that is to be so young, so successful, offered an infusion of cash. I doubt, you know, she ever thought she would see a check for $60 million in her life. Um, but she she took it with such grace and she I think the thing about Sophia that really struck me is she made the best decisions with the tools she had at the time. and she kept learning along the way.
She’s doing the best that she can with the tools that she had at her disposal. And she said, I was making money. I had money in the bank. So I wasn’t, I didn’t know how to read a P&L sheet. I don’t know the CEO and the CFO and all of that, but it seems like that’s the position that she hired somebody to do that for her. She should have somebody backing her up. But again, you know, I don’t have, I’m not privy to any of that information and any of what they were they were doing. It just seems like there was so much that was going right. It’s so easy to like sweep under the rug the things that, oh maybe this isn’t quite going right this time.
I think the thing that was really interesting about Sophia’s story and and why she rose to so much fame and her her business gained so much notoriety is because she really was the first entrepreneur that publicly it like, I don’t totally know what I’m doing. She felt very accessible. She felt like anyone could do it. And I still think that story really rings true to to entrepreneurs today.
Yeah, when you are honest and vulnerable and your life is happening in the public, it can seem really like you’re the, you know, the what did she say, leader of a movement, which sounds like, like she said, this this sounds silly to say. But it’s also so much pressure and then anytime you make a mistake, it’s blown up way out of proportion because it’s so public. And like she said, when you get another job, when you lose a job and you go and get another job, that’s just what you do. But when you do it publicly, it’s this giant story.
And I think she’s taken it with clearly a lot of grace and she’s taken those lessons and pivoted into other very successful businesses that aren’t on the grand scale of Nasty Gal or girl boss, but sound like they’re highly profitable and making a difference in founders lives and she’s really turning her entrepreneurship knowledge that she gained over that time and putting it to really good use.
Yeah. and that is the best thing you can do is take what you’ve learned and then share it with others.
Yeah, absolutely.
All right. Should we get out of here, Caylin?
Let’s do it, Mindy.
That wraps up this episode of the Bigger Pockets Money podcast. She is Caylin Hope Benet and I am Mindy Jensen saying, see you later, alligator.
If you enjoyed today’s episode, please give us a five-star review on Spotify or Apple. And if you’re looking for even more money content, feel free to visit our YouTube channel at youtube.com/biggerpocketsmoney.
Bigger Pockets Money was created by Mindy Jensen and Scott Trench, produced by Kailyn Bennett, editing by Exodus Media, copywriting by Nate Winetrop. Lastly, a big thank you to the Bigger Pockets team for making this show possible.
