You asked for more content around business finances, so we’re delivering. Welcome to Money Matters where we give you an inside look at the pocketbooks of CEOs and entrepreneurs. In this series, you’ll learn what successful women in business spend on office spaces and employee salaries, how they knew it was time to hire someone to manage their finances, and their best advice for talking about money.
Photo: Courtesy of Londre Bodywear
It’s no secret that fashion has a sustainability problem. But while the industry currently accounts for 4% of all global greenhouse gas emissions, consumers are advocating for change and spending their dollars accordingly, investing in brands that are committed to reducing their impact on the environment. Londre is the latest sustainable fashion brand to catch our attention at Create & Cultivate, and we’re not the only ones. The Canadian fashion brand recently received a $208K investment on “Dragons’ Den” (a.k.a the “Shark Tank” of Canada) and we’re eager to share the story behind the brand before you see it all over your Instagram feed (because trust us, you will).
Based in Vancouver, Ainsley Rose and Hannah Todd launched Londre in reaction to the startling amount of plastic pollution in the world's oceans. To date, the brand has recycled 100,000 plastic bottles off of the streets and beaches of Taiwan into their sustainable swimwear offering. But sustainability isn’t just about the planet for Rose and Todd, it’s also about the people. “Our products represent 360-degree sustainability, and this is something we heavily invest in,” Rose tells Create & Cultivate. “We believe that you can’t take care of the planet without taking care of its people, so ensuring our internal and external teams are treated fairly is critical,” Todd adds.
Here, the co-founders share how they bootstrapped the brand with an initial investment of just $15,000 and turned it into a business that generates seven-figure revenue.
Talk us through your bootstrapping process. How did you self-fund Londre, and would you recommend that route to other entrepreneurs today?
AINSLEY ROSE: We took an initial $15,000 CAD investment from a close friend to help with our first round of samples. Since then, we’ve completely bootstrapped our business and have been self-sustaining. As a sustainable mission-driven brand our finances have to be looked at strategically to ensure that we can make choices that enact positive change and benefit both the planet and our business.
HANNAH TODD: Since inception, Londre has seen a 300% year-over-year growth, and a big reason why is that we’ve been scrappy. This has helped us develop clarity in our business because sometimes having too much cash allows you to put a bandaid on a problem instead of fixing the issue from the start. This has also allowed us to grow organically, putting community first and ensuring market need. Not being beholden to a VC or large stake investor also has allowed us to work without an additional layer of pressure, and better tune into our intuition about what is best for our business.
Can you share three crucial elements everyone should include in a pitch deck when raising money?
HT: Because we were pitching to someone we have a strong personal relationship with, our pitch was super simple. We didn’t even have a sample made yet. Ultimately, they chose to invest in us because they had faith in the values and ethics we hold as people, and less so in the product offering itself. Being empathetic, speaking from the heart, and having a good understanding of market trends helped us in our pitch.
AR: The person who invested in us originally is still a trusted advisor and has been able to provide incredibly helpful insights over the years.
What are some of the most common mistakes people make when raising money?
AR: I think the most common thing we see is valuing skills over the relationship. In choosing an investor, or business partner for that matter, ensuring that you feel comfortable communicating honestly and have a strong foundation of trust is key.
HT: We also see people asking for too much too soon. If you are creative enough, you can likely get by with less than you think, and having too many controlling voices involved can complicate things.
How much do you pay yourselves, and how did you know what to pay yourselves?
AR: Londre started out as a side hustle for Hannah and me that eventually became our main gig and source of income. I was working as a photographer, which allowed me to set my own schedule and develop a great network. I eventually stopped taking on new clients once Londre had reached a point where I felt comfortable taking a meaningful salary.
HT: I was working as a yoga instructor so also was able to make my own schedule. We chose how much to pay ourselves based on our lifestyle. To decide on our salaries we budgeted how much we needed each to live comfortable, satisfying, and sustainable lives in Vancouver and worked backward from there! We also allocated a bonus structure to celebrate when sales goals are hit.
How did you decide what to pay employees?
HT: Currently, we work with a team of contractors who are all small business owners in their own right. We find that this gives both parties more flexibility and freedom. We collaboratively decide on compensation and offer performance-based incentives. We believe that you can’t take care of the planet without taking care of its people, so ensuring our internal and external teams are treated fairly is critical.
AR: We look to third-party certifications like Oeko Tex 100 for our fabric and work with Vancouver-based companies with an A+ Better Business rating to ensure that our ethical and sustainable mandate is met. Although working this way is more expensive than using a more traditional fashion model, ensuring value alignment in our brand has made our business thrive, generating seven-figure revenue and feels deeply rewarding.
Where do you think is the most important area for a business owner to focus their financial energy?
AR: Our products represent 360-degree sustainability, and this is something we heavily invest in. We notice more brands are using more recycled materials and it’s something we love to see! However, if sustainability isn’t looked at from a holistic lens, it may easily be greenwashing.
HT: For example, even if a product is made from recycled materials but isn’t functional and high quality, packaged using sustainable materials, and without a plan for the end of its life cycle, it ultimately will end up in a landfill contributing to further waste. We’ve focussed most of our financial energy on product development and quality control. Ensuring that our products are high quality and long-lasting is our first concern, not only from a customer satisfaction standpoint but also from a sustainability perspective. We just launched our first loungewear collection, The Essentials, and a lot of research went into finding fabrics and components that stay true to our 360-degree approach.
What was your first big expense as a business owner?
HT: Our first round of samples. What we thought was going to be a $5000, two-month project turned into a $16,000 venture, nine months later. The first suit we created, the Minimalist in Matte Black, is still our biggest seller, so ultimately the hundreds of revisions were worth it.
What are your top three largest expenses every month?
AR: Production costs (ethical manufacturing and sustainable materials); shipping and compostable and recyclable packaging; and digital ads (we actually only started running them in the last year).
How much do you spend on office space?
HT: $0. We are fully remote.
How much do you spend on employee salaries?
AR: Contractors and our salaries: ~$25,000 a month
How much are you saving, and when did you start being able to save some of your income?
HT: We as co-founders save about $1,000 a month each. We’ve only started paying ourselves enough to save within the past year.
Did you hire an accountant? Who helped you with the financial decisions and setup of the business?
AR: Yes! We have an accountant who supports our year-end and we use QuickBooks for day-to-day accounting.
HT: Ainsley’s fiance is a CPA and he’s stepped in to help us with inventory forecasting and budgeting when we need support with more complex financial modeling
What are some of the tools you use to stay on top of your business financials?
AR: We use QuickBooks for our accounting. We also have a detailed model which helps us plan our inventory, forecasting, and budgeting. Additionally, we have a recurring calendar event monthly to go over inventory and budgeting.
What do you wish you’d done anything differently in your financial journey as business owners?
HT: We overspent on in-person events. The most successful event we held was actually the least expensive, as connection trumps extravagant details every time.
Do you think women should talk about money and business more?
AR: Absolutely! There is so much stigma around gaining wealth, particularly for women. We’ve both taken courses by Lacy Phillips to break down any blocks and baggage we may hold around money and learn how to move into abundance.
HT: We feel privileged to have a community of entrepreneurial womxn who we can talk candidly about finances and this has helped us immeasurably.
Do you have a financial mentor, and do you think all business owners need one?
HT: Our investor, who still has a small stake in Londre Bodywear, is our financial mentor. This relationship works for us because we can communicate openly with them and have been able to lean on their entrepreneurial experience. We check in every two months so we can ask general questions.
AR: We don’t think you necessarily need a mentor because your intuition is best, but having a mentor who you can trust to gather advice from and see if it fits has been helpful for us.
What is your best piece of financial advice for new entrepreneurs?
HT: Get super clear on your values. There are tons of shiny things to be distracted by but when you have a foundation of nonnegotiable sustainability (or whatever your chief value is) it allows for further clarity.
AR: Also, don’t be afraid to negotiate and see what transactions you can do as trade instead of monetarily. Get creative with your trades! We asked for tons of help and in exchange would not only offer store credit, but also services that lined up with our skills. For example, Hannah was a yoga instructor and would offer a private yoga session in exchange for someone helping us build a financial model.
What have been some of the hardest money lessons you've learned along the way?
AR: We originally wanted to start our business in Bali. Our fabric and samples were stolen, and I was left waiting at the airport at 1 A.M. for the sample maker, who never showed up, and had nothing to show for a two-week-long trip. We ended up restarting in Vancouver (where we live), and now are able to have eyes on production. Keeping things close to home so you can directly oversee everything gives you more control over how your money is used.
HT: Wait until you have clear market approvable before creating a huge run of your product. We’ve always valued organic growth and doing small runs and which has contributed to increased demand and zero wasted product.
What is your #1 money tip for small business owners?
HT: Be scrappy, don’t be afraid to ask hard questions, and negotiate in a kind and empathetic way.
AR: Keep your values at the forefront of all of your financial decisions.
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