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By Rhea Cartwright
ules Miller, CEO and co-founder of leading wellness brand The Nue Co, has just raised $25 million in Series B funding. Having launched in 2017, the brand has reimagined supplements alongside revolutionary topical skincare which aim to tackle everything from stressed skin to gut health.
Having never spoken to an investor in her life before starting The Nue Co, 31-year-old Miller is taking it all in her stride. She talks exclusively with The Stack about how to raise investment capital, the importance of knowing what people want and why funding isn’t the most important thing to celebrate.
“The idea of clean and sustainable brands was still very much in its infancy in 2017. Even in our category, there are only a handful of brands that are really dominating that conversation. We started with this idea of clean and sustainable ingredients that were sourced ethically as sourcing ingredients makes the organism a lot more potent and powerful to deliver results.
We spent a good few months looking at the category and we identified things that were wrong with it. The first was the retention rate. When you're taking a supplement, it should be something that you stay loyal to taking every day but the retention rate of the category was around 25-30% which leads to the percentage of people that would repurchase. We did lots of research round tables and identified that people didn’t know what they were looking for or they’d forget to take it because it felt like a chore. They didn't have any relationships with the brands that they were purchasing so they would buy from a different one every month.
First and foremost, we wanted to develop an experience that people looked forward to engaging with every day. We have a 70% repeat purchase rate, which actually jumped up to 80% when COVID hit. I think our really loyal customer base is why we've been able to raise so easily throughout the years because our retention has always been high.”
“Whether it’s a retailer, a journalist or an investor, you always need to think about what the other person wants, and whether you can give it to them.”
“Before The Nue Co I had never spoken to an investor in my life. I had zero experience but I knew was that it was going to take a lot of funding to get it right because I wanted to invest in the formulas, talk with the best labs and use the best ingredients.
In all honesty, that was the hardest part of the whole journey. When you go knocking on the doors of these labs, whereby one of their customers is bringing in $3-4 million a year and you want to produce 500 units for launch, they’re not interested. You can sell your dream into Net-A-Porter or pitch for money but when it comes to just dollars and minimum order quantities, you can’t run away from it.
I knew that I needed to not only get money, but I also needed to get the right investors around the table from the get-go that would really open up those conversations and make the introductions. We initially raised a really small round from angel investors which was enough for me to start developing the brand. I started working with a really small lab in Cambridge that my grandfather introduced me to.”
“Whether it’s a retailer, a journalist or an investor, you always need to think about what the other person wants, and whether you can give it to them. With Net-A-Porter, they had just launched wellness and had about two or three brands at the time. I went in and said specifically that this is the type of brand that their customers would gravitate to. It feels and looks like a beauty brand but it's really going to deliver those health benefits. They basically said yes on the spot.
I was able to go out and speak to meaningful investors and got investment from Unilever really early on after launching onto Net-A-Porter. Once I had that Unilever backing, it was relatively easy for us to really pull together the rest of the round. So the round was made up of Unilever and Morningside group, who were a really huge biotech fund, who were really investing in like Harvard Medical School and different technologies to help with things like cancer treatments. They weren’t consumer-focused but were very well versed when it came to ingredients and manufacturing. With Unilever, it gave us huge ability to help with things like category insights. They made up our seed round of $1.5 million.”
“I don't think you should ever go into a fundraise if you're not prepared to walk away from potential investment.”
“It's all about networking and who you know so I flew to New York. When I was looking at the category and I was trying to identify how we could own the category, we saw that 80% of consumers in America were taking a supplement every day whereas it was only 35% in the UK. There was a bigger market in the US so we moved there with E-2 visas, which are investor visas that essentially say, I'm going to go to the US to grow a business and invest in the economy.
Our parent company is a UK limited company. And then our subsidiary is a US company, which is wholly owned by the UK company. So another investor that we got funding from early on was Victress Capital, which only invests in female-led businesses. They’re made up of three women; two from a finance background and the other one was from Facebook. They were super hands on, it was literally like they were in my team. They hooked me up with the best lawyer in New York, they helped set up a lot of the US company structure. I was very fortunate that they got so involved because my background is not in this type of stuff.”
“First and foremost, I would say that the funding experience for us has been incredible as we've had amazing support from investors. I would not have been able to do it without insights, support, people telling me that I'm wrong when I'm wrong, or telling me what I don't want to hear when I needed to hear it. I don't think I would ever launch a company without getting some level of funding because I always saw it as a way of growing my team and I always worked super collaboratively.
When you're raising money, don't be scared about what it's going to look like on the other side because it is dependent on the terms you agree. I've done so many raises whereby I've met an investor, I loved them, we signed a term sheet and then when we're going through the due diligence process, there have been little red flags. If it doesn't feel right, we're going to walk away from it. I don't think you should ever go into a fundraise if you're not prepared to walk away from potential investment. Most companies that I know, that have failed because of issues that came from the top down. You will feel the pressure if you have the wrong investors, who aren’t aligned or aren’t clear on your strategy. I know so many founders who are struggling with mental health issues and that trickles down into having a toxic working environment.
I can't stress how important it is for you to find investors who always know your strengths and my weaknesses. I'm super passionate and I have a lot of conviction in what I say. I will take people's advice and I'll change things when it makes sense but I'm never going to do something that I inherently feel is wrong for the business. I'm protecting their business as much as it is my business. You have to find investors who really trust and believe in you because when it gets hard, and it does get hard, you want to be in a position where you can call them and ask for help. Rather than trying to hide everything and you can’t speak to them because you're scared that they might fire you if you tell them the truth.”
“The vast majority of the time, you're raising a lot of money and the investor is betting on you. You have to make sure that you are performing.”
“I think what people forget, is that you raise a lot of money on a certain valuation, and it dictates your path of growth. People often think that most founders will get that money in their bank and they’re suddenly millionaires. What actually happens is that founders may go on holiday for two weeks and then it's crazy because you have to hire all these new people and implement all of these new processes that we've grown over 100% every single year.
Everybody in the company needs to be really comfortable working in a completely different business every six months because what works today won’t work in six months time. You have to completely change workflows. It’s super exciting because you can do more, launch more products, get in front of more people, invest in things that are really meaningful to you but it definitely does come with a high expectation. You need to be confident you can deliver those things before getting money.”
“I’m married to my co-founder. The combination works so well because we’re incredibly different. I make decisions super quickly and I always have a clear understanding or a gut feeling. Whereas Charlie is one of the most considered people you'll ever meet. He has an incredible boss, an incredible listener and will think about how we’re actually going to make it work.
We wouldn't have got involved really with each other in this capacity if we didn’t think we’d be the best partner for each other. Throughout the years, we've had to implement silly rules such as not talking about work at the table. It’s invaluable to have a partner that you wholly trust.”
“Raising money feels like a big thing but I think it's bad that so much focus goes on founders raising because it's not indicative of a good business. There are so many companies that have raised so much money that essentially tank because they're not driving the business forward in the right way. The biggest things that we celebrate are our customer reviews. If you’ve had IBS for five years and you take a product that works, it really does change your life. We all share customer reviews on slack and we’re very much a team that celebrates together. I think that's what drives everybody at The Nue Co. I know we’ve spoken about retention and conversion rate but ultimately we’re really helping improve people’s day - thats the most meaningful thing for us.”
Raising money might historically be more challenging for women but Jules Miller has now raised over $35 million in total.
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