Apparel Company Sistahs of Harlem has Creativity, Buzz, and Attitude to Spare
The Pitch: "We run a women's clothing line that has a point of reference. Our clothes are about conscientiousness, caring, and awareness--all with a sense of fun--and each collection is inspired by powerful female figures, such as Bessie Coleman, the first black female pilot. We have something for everyone, but our typical clients are metropolitan women who range from age 15 to 50 and are eclectic and socially conscious. The tags on our clothes inform our customers that we make all of our garments in the United States. Each tag also includes biographical information on the inspirational female figure behind a given collection."
Company: Sistahs of Harlem
Owners: Carmen Webber, Carmia Marshall
Location: New York City
2005 Revenue: $28,000
2006 revenue: $32,000
Investment Needed: First, $250,000 to fund five trade shows in 2007. Then, $5 million to hire a production manager and a salesperson, pursue deals with chains such as Target (NYSE:TGT), and open a retail store
Clientele: Shoppers at five New York City boutiques and 100 regular custom clients, including singer Erykah Badu
Recent Buzz: Mentions in Nylon and Vibe magazines, guest spots on the Style Channel's The Look for Less, and their book, T-Shirt Makeovers
Get sales help ASAP
It might make more sense for Webber and Marshall to raise $300,000 in a first round and hire a salesperson now. Then they'll have someone to handle sales when they start raising their next round of funding. As for their pitch, the hang tag concept is cool, but the "point of reference" idea doesn't mean anything to me. Webber and Marshall need to find words that will resonate with their target audience--maybe something like, "We provide funky, unique active wear that women can dress down or wear to a black-tie event." When you go to an investor who is not very hip, it also helps to draw analogies, such as, "We're what Anthropologie is to hipsters."
St. Helena, California
More experience needed
I'd advise the partners to start off by borrowing money from friends and family who want to be part of their brand. Then they should approach individual angels with experience in the retail industry. Investors will look at the product, the market, and the team. Webber and Marshall seem very creative, and that's good. But they need executives or advisory board members who have experience building retail brands. They should keep in mind that, when investors hear a pitch, they want to know what a company does in very simple terms. The "something for everyone" part of this pitch worries me; it makes me think the company is going to be unfocused.
Managing Director, CommonAngels
What do you stand for?
If the Sistahs of Harlem can identify one garment they're known for and build a strong following around it, they can go to investors armed with a proven product, an established brand, and the ability to execute creative ideas. At that point, they may be able to raise between $3 million and $5 million in venture financing or private equity. First, they must define their target customer very narrowly. They've done well building a lifestyle brand, conscientious production methods, and word-of-mouth marketing. But their 15-to-50 target age demographic is far too wide. What 15-year-old wants to be seen in the same "fashionable" attire as a 50-year-old?
Principal, Texas Pacific Group Ventures