Ep 32 – A Recipe for Reinvention


Disha Gulati is the co-founder and CEO of Here Here Market, an online marketplace leading the restaurant-retail-transformation and providing consumers nationwide access to chef-driven products. Prior to this, she was the head of global analytics for Mondelez International, a fortune 100 CPG company. 

Disha comes with over 20 years of experience in business strategy, innovation, and analytics. She spent her corporate years as a management consultant for Deloitte Consulting and as the Vice President of Corporate Innovation for 1871, one of the largest tech-incubators in North America.

Disha has her MBA from the Booth School of Business. She currently lives in Chicago with her husband and toddler son.  


What do you do when your cherished startup idea vaporizes right before launch, the world shuts down….and you’ve just had a baby?

How do you deal with the hand you’ve been dealt, and still make it work as a business?

What do you need to know, and how do you adapt in the midst of a maelstrom of change and uncertainty?

In this episode, Disha Gulati, cofounder and CEO of Here Here Market, talks about how she turned her entire startup on a dime when the pandemic destroyed their original business model, how she learned to find an attractive new market by turning disaster into opportunity, how she uses data to constantly find her way, and increase the value of her offerings to her customers, and much more.

Episode Highlights

  1. How a new venture is born – right alongside a new baby
  2. How to survive when your business model vaporizes overnight
  3. How to find opportunities to serve your market in the midst of calamity
  4. How to iterate your way to sustainable revenue streams
  5. How to leverage customers’ micro-behaviors to nail your value proposition
  6. How to tap into market behaviors to find new revenue opportunities
  7. How to use the industry leader’s strategy to develop your competitive strategy and advantage
  8. How to use non-scalable processes to build scale
  9. How to build a two-sided marketplace
  10. How to find the core metrics that are crucial for your revenue growth
  11. How to find, test and roll out new value propositions
  12. How to use data to stay one step ahead of consumer needs and actions
  13. How to optimize your service model to simplify operations
  14. How to blend art, science and instinct for effective fundraising

Links and Resources

Here Here Market: The boutique food marketplace that Disha co-founded

Interview Transcript

Shubha Chakravarthy: Good afternoon, Disha. Thanks for joining us today. It’s really awesome to have you.

Disha Gulati: It is my pleasure. Thank you for having me on!

Shubha Chakravarthy: You have had a pretty interesting journey, from corporate America down to entrepreneurship. What brought you to where you are today?

Disha Gulati: I feel like I’ve tried a little bit of everything. I started my career in consulting. I spent over 10 years as a management consultant working for Deloitte and I was at an inflection point, being a career consultant.

I was headhunted by a company called Mondelez International, which is one of the largest snacking companies in the world. They operate in 80 countries, and I got to see how billion dollar brands like Oreo cookies work across the world, all the way down to visiting the beloved Cadbury factory in the UK and seeing how one of the most popular chocolates in the world are made.

I got to visit India and go to like the mom-and-pop stores. It was all around at that time. There was a big emergence of direct-to-consumer brands. Lots of interesting stuff happening in the CPG world, in the food packaging world.

Once again, I had the itch at times, and it felt like I was in this ivory tower where we aspired to do a lot of transformative things but by the time it boiled down to the regions and to the brands it was very watered down.

I had the opportunity to meet some amazing folks from Gordon Food Services who run an innovation studio here in Chicago for Gordon Food Services, which is the third largest food distribution company in the United States. They were starting to build their innovation studio here in Chicago called Relish Works.

They were starting to incubate white space ideas in the hospitality space in the future of food space sustainability – everything across the food supply chain, right from the farm to the table, and hopefully meandering through the restaurants.

They were looking for experienced operators to take these ideas, spin them out as their own companies, within the Gordon Foods portfolio. So that was a super interesting opportunity to shift gears once again. That is kind of my journey to Here Here Market.

Shubha Chakravarthy: That is fantastic to hear. What does Here Here Market do?

Disha Gulati: Here Here Market is an online marketplace that is leading the restaurant-to-retail transformation, specifically for chef-driven products.

What that means is that we are starting to connect chef runners who are starting to either diversify their revenue streams or exclusively wanting to move into consumer-packaged goods.

We are helping them find markets, identify the right product and the market fit, and help them manage, scale, and grow their businesses.

Shubha Chakravarthy: It is clear that there is a lot in your background that is starting to put the dots in place, but what was the trigger that made you say, “Geez, there’s an opportunity here that I can do something about!”

Disha Gulati: Interestingly enough, it wasn’t something that came out of market research, it actually came out of necessity. When I first started as an entrepreneur in residence with Gordon Food Services, we were working on a very different business concept and this was in late 2019.

We were hoping to build a platform that would help restaurants with their group dining needs. It would involve everything from discovering the right restaurant for your group dining needs, which could be totally different if you are trying to host a corporate dinner versus a fun girl’s night out versus your dad’s retirement party. The vibe is different, and the budget is different.

So, discovering the right kind of restaurant is hard. Making reservations for a large party is certainly something that still is very analog, so it is hard to do it online.

They still make you call the restaurant and play phone tag with the events team and whatnot. Then in many instances splitting the check leaves a bad aftertaste in your mind.

So, we were trying to optimize this entire vertical value chain between discovery, reservations, and the payment. We built and launched an MVP platform in February of 2020 and then what happened in March of 2020? I kid you not, but group dining became illegal across the country.

I mean, I never thought I would say those words, but here we were! I think it was March 15th when in Chicago Mayor Lightfoot said, “Okay, starting tomorrow, restaurants are to go and you cannot congregate more than four people or two people” – I forget what it was.

My team was just like, “What are we supposed to do?” This is our entire thesis.

By the way it was March 15th, so I was 35 days postpartum. I was actually on my maternity leave when all of this was going down. So, the team gave me a call and were like, “What do you want us to do while we wait for the restaurants to open back up?”

Nobody knew how the next year would unfold. So, we were in a holding pattern for a little bit of time, but we said, “You know what? We have the resources, we have the capability, and we have the team. Why don’t we just help our restaurant partners in any way we can?”

A lot of restaurants started to diversify their revenue streams. One of the paths that they took was to enter the consumer-packaged goods industry.

Here in Chicago, a lot of restaurants started to can their most popular sauces or sell their seasoning blends or sell their jams or preserves or shelf stable pasta, whatever the case may be. People got really creative.

What was really cool about it was that a lot of these culinary creators, a lot of these chefs, and restaurant operators already had a built-in audience. They already had a fan base that they could start their journey with, get feedback from, and things like that.

What they also quickly learned was that even though they were making these incredible products that had that and they were receiving great feedback from their concentrated fan bases, they knew very little about growing their businesses.

They knew very little about the front and the backdoor, about customer acquisition, direct to consumer marketing, and everything on the back end with fulfilment and logistics. Not only did they know very little, what we also learned is that they didn’t want to do it. These amazing, talented chefs just wanted to make food!

So, we started to help them on a very ad hoc basis. The more chefs and restaurants we helped, the more came out of the woodworks and said, “Hey, we are doing the same thing. Can you help sell our products? Can you help set up our e-commerce operations?”

So on and so forth, six months into that, we took a pause and we said, “It feels like there are a lot of grassroots holes in the market or something that is happening that we didn’t anticipate as we entered this industry. But it is certainly happening. There is certainly momentum behind it, both from the supply and the demand side.”

The chefs were very motivated and small CPG creators were also motivated to go directly to the consumer to build something and we are seeing success with that.

From a consumer perspective, 9 out of 10 consumers want to buy small, local, and direct, but the problem is discovery. Where do you find this talent? In a non-pandemic world, you would typically find some of this talent in your local farmer’s market.

But again, you would be geographically constrained. So, there wasn’t really a place online, if you think about it, where we could convene the supply and the demand. We could connect the true fans that were across the country to these chef creators.

That is when we said, “Stop. What we need to do is to build a marketplace.” That is how Here Here Market came together.

Shubha Chakravarthy: What inspired the name?

Disha Gulati: I get this question all the time, it is a celebratory homage. It is kind of like people coming together over an incredible meal or drinks or celebrating something. So, that’s one.

When we initially started the market, we thought we were connecting local culinary talent with local audiences because typically the fan bases are local. You go to your neighborhood restaurant and the neighborhood loves it and it is written up in Eater and other people come, but it’s fairly local, right? People aren’t flying in unless you are Noma or something.

So, that’s what we were doing, and we thought Here Here would also emote that, the localness of the marketplace. However, what we very quickly learned is these chefs and culinary creators have fans all over the country and it wasn’t always that they found that following by names.

So, it isn’t like people were looking for a particular chef in Chicago. We have Stephanie Izard on our platform and people are forever looking for her. She is on TV and all of those things, but people were just looking for better products.

People were looking for a better chili oil. People were looking for a better miso. People were just looking for a better granola. When they would type that in, these guys would show up. That was the value we were adding in terms of optimizing on search keywords and things like that. People would be like, “Oh my goodness. A chef has this amazing restaurant in Chicago!”

Chicago is a tough food market, but it is also a very innovative food market, so this has to be legit. So, a lot of our sales, interestingly enough, and I’d never thought about this before we started here, the market come from the suburbs and from small town America because we are spoiled living in a big city where there is a Whole Foods and a Trader Joe’s, and many specialty stores are blocks away.

But there are towns and cities in America where that is not the case, or it is not convenient or the hospitality industry isn’t as vibrant. There aren’t as many fairs or famers’ markets, or whatever, but these folks are also wanting to recreate those restaurant experiences at home.

We started Here Here with this local kind of emotion, but quickly it became more of a national play than local.

Shubha Chakravarthy: I love the story. You addressed a lot of the things that I wanted to ask you about. So, let’s go to another critical part which is funding. How did you fund and how did you think about funding in the earliest days of your operation?

Disha Gulati: As a founder, we are always fundraising. Let me tell you, it never gets easier.

We were fortunate in the early days to have Gordon Food Services as a strategic investor and that is kind of what got us off the ground and going.

But that said, the training wheels came off quickly. So, we went out there and we filled out the round with other VCs and angel investors, with more angel investors than VCs because we were just we were so early in our journey.

We also participated in a few accelerators and programs that came with a check. So that also helped us in our growth trajectory. I will tell you that funding was easier during the pandemic when we were still figuring out the business than it is right now.

Shubha Chakravarthy: “Just enough to get you going.” It sounds like you had all the resources you needed. The product market fit feels like it was somewhat forced on you just because you had to quickly turn the battleship on a dime.

You had to adapt to what was happening in the pandemic and you did that by serving one of your biggest partners, which is all these restaurant folks, especially because you had to change everything and start from scratch.

How did you figure out the right business model that was going to be effective later?

Disha Gulati: I think a lot of that was testing and learning, and just not being bound by a playbook. The birth of the marketplace was so organic, initially we said, “Okay, we are going to help with distribution because one of the things that the creators were struggling with is getting the product out the door. How do they ship it? What are the details there?”

We said, “You know what? We can actually create economies of scale. If we are shipping on behalf of all of you guys, we can get everything in one box.” It is a unified card experience for the consumer.

Amazon has trained everybody or spoiled everybody to be like “No shipping costs and everything in one box.” So, this concept of “I would try new products, but I have to go to 10 different sites and pay shipping 10 times” was a non-starter for the consumer.

Shipping costs are typically also in e-commerce one of the bigger reasons why carts are abandoned. So, that was the first thing we tried to solve and on the flip side, the creator’s working in their kitchens. The creator has this whole other kind of business that they are focused on, which is very day to day, like running a restaurant.

So, they didn’t want to run out of the kitchen three times a week, go to a UPS store, and send out their order. That is where we started and it is interesting because we, Nick and I, my co-founder and I, always talk about this in the sense that we didn’t think we were getting into a warehousing or a fulfillment business, but here we were.

We literally learned on the job. Initially when we started, we were ordering boxes on Amazon, and we were like, “This doesn’t feel right. There has to be a better setup, a cheaper setup than ordering boxes on Amazon”.

So, slowly we kind of learned, we tested, and we said, “What else do we need? How do we set up this warehouse? What can we build that doesn’t necessarily need to scale, but we can test with?”

So, that was the first problem that we alleviated for our creator. The next thing was that they wanted our help with attracting the right consumer and helping convert their traffic into sales because they have an online presence, and they are all micro or fairly established influencers in their own right.

They could bring the audience to their social media platforms. But then the question was, “How do you take it from there to a transaction and then how do you actually get them to convert on the transaction?”

So, that was the next thing we focused on.

Shubha Chakravarthy: And how did you crack that?

Disha Gulati: Everything is testing and learning and taking baby steps. I come from a data and analytics background.

We started with “How much traffic is coming to the site? What is right for our stage of the business with as many creators we had and as many products we had? Once the traffic was on the site, what percentage of that traffic was actually converting? Was that the right percentage of traffic that was converting? If the percentage was low, was it low across all of our creators? Was it low for some of our creators? Did the quality of traffic differ in terms of sales for certain creators versus other creators?” The answer is “Yes.”

These were all levers that we had to pull, and it was like an onion. You have to peel and be like, “Okay what is this layer telling me? It is telling me that I can get the traffic to the site, but I’m having a hard time converting it. I’m converting the traffic, but it is not for the right creator” or “I can incentivize the consumer to make the first purchase, but they are not coming back.”

So, these were things that we were starting to unravel.

Some things that we specifically focused on, for example, was the repurchase rate. If we bought the right consumer to the platform who was a foodie, who followed at least one creator or knew of at least one creator, one restaurant, they would come back and make another purchase.

So, that was kind of what we focused on. I think we did a fairly decent job because the repurchase rate on the marketplace today is 1.8, meaning 80% of our consumers who’ve made a purchase in the last 12 months come back and make another purchase. That is a metric we truly focused on, and you can’t really have that metric for every single user that comes to the site.

So, you have to identify who your segment is. But we also learned that when a consumer follows a creator and comes to the site, they are more loyal and tend to have a bigger basket size or a bigger transaction set than somebody that saw an ad for his market.

Shubha Chakravarthy: There is a lot of stuff there to peel back. Let us unpack it one at a time. First is the business model. So, clearly you are a marketplace, and you had a couple of different choices.

Subscription boxes are all the rage. You had the subscription option or you had the pure e-commerce where the consumer would come here when they have a need and then hopefully they’ll come back again.

What was the factor that helped you decide in favor of the pure e-commerce versus something like a subscription box?

Disha Gulati: We do have subscription options available as well, by the way. Both models can coexist and that is what we are focusing on right now. So, we started with individual transactions because we were also trying to see what the product market fit for these products was.

Also, I personally think that there is a little bit of subscription fatigue in the world. To subscribe to products that you have never tried before or been exposed to before is a little bit of a harder sell.

Food is so tactile. For example, one of the things that we have learned is when we do pop-ups and customers come to our popup and talk to our creators and buy their products, they have a higher repurchase rate and more loyalty with the platform because they have tried it and they have met the creator or they understand the story and they know what they are getting into again.

That is harder to do when you are a digital first platform.

So, we wanted to start on the transaction side, and this is the thing – we are a marketplace, but what sets us apart is that as a creator when you come in, you set up your digital storefront, and off you go.

We work very closely with our creators to say, “Hey, this is how you are performing within your category. This is where you kind of sit in the price distribution of your product versus your competitor and these are the trends that we are seeing in the market. These are the sales patterns that we are seeing on our platform as well.”

So, that is the kind of information we are giving for them to first find their product market fit before we roll it all up into a subscription. That said, we feel like we have been in business for 17 months. We are at a point where we believe that for the right products and the right configurations of assortments, we have successful subscription options.

In fact, we were on the Today Show last month for our subscriptions, which was quite neat. Of course, it was our bestselling month for subscriptions, that day and that month. But it showed us that there is a market for certain assortments that can be put on subscriptions. So, that is actually the next project we are working on.

Shubha Chakravarthy: Congratulations! Sounds like you are really hitting a lot of high notes on that. So, a lot of little nuances that you would never think about if you are not in the industry. That was pretty enlightening.

It sounds like this pop-up model is a big part of giving people human feel for who you are and why Here Here Market makes sense.

To what extent is that a part of your retail customer acquisition model. Can you talk more broadly about how you are thinking about customer acquisition? It is a two-sided platform, I get it, but how does it work on the retail side?

Disha Gulati: The popups are something we have tried, and we will continue to do opportunistically. For example, if you are in Chicago, we currently have a three month residency in the John Hancock Center, where we have teamed up with World Business Chicago to showcase some of our emerging culinary creators on the busiest retail block in the city.

So, opportunistically we will do popups. It is not core to our strategy because like I was saying, a lot of our fan bases and audiences are national. The issue still remains that you have to try food to truly understand it and fall in love with it, especially because a lot of our creators are trying to do things differently.

These are not your run of the mill condiments or run-of-the-mill snacks. We have these amazing snacks called Nemi snacks, which is cactus sticks. They are so good, but honestly, if you saw them online and if you didn’t know what they were, you likely wouldn’t order them. So, how do we get you to try them before you buy them?

One of the things that we are going to launch in Q2 of this year is what we call our sampling program. Much like purchasing on Sephora, for example, when you get your checkout and you say, “Hey, you qualify for these three samples, which one would you like to pick?” – that is the kind of program we are working on with our creators for these emerging brands and these emerging tastes, if you may.

Shubha Chakravarthy: Let’s turn to the creator side. What is your ideal creator profile? How do you go about acquiring these creators?

Disha Gulati: We have a geographic approach in terms of acquiring creators only because what we have learned is that the creator community – the culinary community is geographically driven. So, if you can penetrate the nucleus of that community, the network effect is real, and it starts to run itself very quickly.

As we think about acquiring creators, we think about it by market impact. 40% of the creators that are on our platform have come through referrals or inbound interests, straight up non incentive referrals, meaning, “Hey, I enjoy working with you guys and on your platform so much. Here’s another buddy of mine who’s a chef at so-and-so restaurant or is starting to launch their own product line, would you consider talking to them?”

So, as we think about acquisition we think about it from a market perspective, and of course now we’ve built some proprietary insights into who our ICP(ideal customer profile) is and what kind of products they have, what kind of social following do they have, what is their general footprint, and how can they incentivize their fan bases to come onto the platform.

That is how we work when we think about our creators. We put them in three buckets, either they have a product, and it is fairly mature, and they are looking for another distribution channel or a more strategic partner. What we offer on Here Here Market is very turnkey in terms of the distribution, the marketing services, and all of those things.

The second group is folks who have a product but haven’t found their product market fit yet. The world pushed them to can their most popular salsa. “Okay, I’ve canned it. Now what? I’ve figured out the labelling, I’ve figured out the FPA compliance, and I’ve figured out the food safety issues, but the only place I sell it is in my restaurant or on my website. So, where do I go from here?”

Helping them figure out how to commercialize their product right is the second category of creators we work with, and we have a set of services that we provide for them.

Then the third category is complete white space where we will have impact. We are working with a couple of chefs here in Chicago right now who are like, “I get it. I have to diversify into products. It is the most natural thing for me to do as a restaurant operator or a hospitality group. I think I can make these 10 products. Where do I start? Which one should I make? Can you lead me through this entire journey?”

So, we have a separate set of modern wall services that we offer to these creators where we help them in even thinking through what is their product that they should be launching and why that is the case? What is the search volume? What are the sales trends or patterns for the last year telling us what is trending in terms of ingredients and so forth.

No two creators are the same, but we can largely categorize them in one of these three categories.

Shubha Chakravarthy: I think to me the main things that stood out is number one, where you are taking a very strategic approach to how you are selecting, nurturing, and bringing out these individual creators. That was the first big insight I took away. It is a very data driven, as well as the strategic exercise so that you are very intentional and conscious.

The second takeaway was just how you segmented these creators in the sense, “What value are you bringing to the table?” Then secondly, how do you then support them in the way that makes most sense for you, as well as the highest value added for them? So, that was very instructive.

All of this is very complicated operationally leave alone logistically, which is we’ve talked about.

How did you figure out the economics? Obviously you don’t want to go into the proprietary stuff, but can you walk me through the thought process and the strategy behind figuring out how to make the economics work?

Disha Gulati: Honestly, it is not rocket science. The traditional go to market for CPG products is through a distributor-based model. So, typically a CPG brand will sell to a distributor at 40% discounts, and then they tack on additional fees for slotting for promotions and if it is expired, they return the product to you.

It is a very cost-prohibitive exercise and there are no guarantees that you can actually get into the bigger stores. Even if you get into the bigger stores, there’s no guarantee that you stay there and the upfront investment that is needed to make your way there is large and sometimes unattainable for these creators.

Some small brands want to remain small by choice, but many want to grow, but it is hard to grow through that traditional model. Our economics just made sense for the creator as well as us, right?

On the marketplace, they get to set their price. So, if they want to set a price that considers our commission, they are welcome to do so. If they want to set a price that is competitive with others in their category and somehow work in the commission in their margins, they are free to do so as well. We never pressure them to be like, “Your price needs to be A, B, or C.”

We can guide them, we can direct them, and we can tell them what’s happening in the market but the end of the day, they are free to list their products at whatever price they like. We have actually never had anyone decide not to be on the platform because of the commission that we charge.

Shubha Chakravarthy: So, a lot of these chefs, and perhaps this applies to other artisanal creators as well, they are not business people fundamentally, they are creators. They are experts, they are craftsmen.

To what extent do you offer support in terms of thinking about things with the business lens and saying, “Here is how you think about pricing.”

I mean, if they run restaurants, clearly they run businesses, but it is a different business than CPG. To what extent are you finding that you need to help them and how do you actually help them maximize their own economics?

Disha Gulati: To the extent they want to be helped, right? Some are pretty set fast in their beliefs and their pricing models and where they want to sit in that category – meaning they want to sit at the top of that category. “Your chili oil is the most expensive chili oil.”

We will say that to them and we will say “It’s not moving” or “It’s hard to put the most expensive chili oil in a basket because then the collective cost of the basket is inflated and the basket doesn’t sell well.”

So, we will bring these data points back to them, but at the end of the day, it is for them to decide, and honestly, it is a balance, right? If the creator can’t tap into a fan base, into an audience base that is willing to pay that premium because the ingredients are premium ingredients, or the chef has national fame or recognition, and he thinks he can charge those prices, more power to you.

To the extent they want to be helped, we will provide some of our insights which are built in, but we are also working on a service which will help our creators set the price and or evaluate where they stand within the category.

Shubha Chakravarthy: You have been extraordinarily articulate about the business model and that is a huge help. Let us turn our direction and focus slightly into the fundraising side. You mentioned earlier, briefly about having gotten off to a start and then you also mentioned this comment that fundraising never stops for an entrepreneur.

So first off, help me understand how you are viewing the entire fundraising journey from the time you started.

What are the milestones, the gate posts that you need to cross in terms of when you get certain specific series of funding and how you’re thinking about that?

Disha Gulati: The most obvious advice, which I’m sure if I heard it, I would roll my eyes too, is to go as far as you can bootstrap, delay fundraising as much as you can. That is hard to do with some businesses that either require a lot of R&D or in our case is a consumer-focused business because there is a certain path to profitability that you don’t get on day one.

There is my disclaimer but other than that it is so true.

One is, when you say you are always fundraising, it is never too soon to start building relationships. It might be too soon sometimes, in my experience to pitch your business with fundraising.

So, you have to get smart about who you are pitching to and at what state of the business because sometimes you just get one shot at that fund or at that relationship or that person. Of course, in the earlier days, I would start with friends and family and angel to the extent you can.

I would also say, it is not uncommon to have your pre-seed rounds made up of investments from accelerators and incubators.

I wouldn’t do too many of them. I would be careful about the terms you are accepting. Everything is negotiable. Almost everything is negotiable. So, see if you can negotiate the terms even with programs, that is the advice I would give from a pre-seed perspective.

But I can’t stress how much on the need to be frugal, the need to be lean and the need to build things that don’t scale. If you were an experienced operator like Nick and I are, there is this innate need to set up process to build things that will last a while but you just have to make the right choices and say, “I know what I’m setting in place is cheap and dirty and likely won’t even last us for the next six months”, but this is what needs to happen.

Sometimes you are moving fast, and you are just throwing money at the problem and hoping you will figure it out and sometimes you do that, but you have to create the right balance.

So, the need to always have an eye on your runway is important because it creeps up on you.

So, I would say start building the relationships. Even if you are a founder who doesn’t have many VC relationships at the beginning of your journey, even if you’re like, “Hey, I’m just working on this deck. What is the need and what am I going to say to this angel or this VC?”

Take the meeting, set some kind of a relationship that allows you to send them a note later to follow up and say, “I read this article, it really resonates with me and what we are trying to solve for. I thought I’d share it with you. You are in the industry. Can I put you on my investor updates?”

You might not have any investors, but you might have an update newsletter, right? Some of the conversations that we had in our pre-seed round didn’t really get to provision there, but now we are picking them back up because they have seen us grow in the last 12 to 14 months.

So, this is why I say as a founder, you are always fundraising for the right partnership. You might open up around that which you were thinking was done so that’s what I would say, “I think we are not there yet”, but at some point then you say, “Okay, how long do I want to rely on outside capital? When am I going to be back?”

It is definitely a numbers game. I did not believe this. I think I knew it, but I didn’t fully internalize it till I had to hit these numbers and some level of success. It is truly a numbers game.

So, create your target list, you have to run it like a process. You have to have a minimum of 100-125 conversations to see some S of Success in your in the fund process.

Shubha Chakravarthy: When you talk about it being a numbers game, I’m assuming you are talking about the fundraising process itself, that you need to treat it like a job interview or a job search process where you have to have a very big number of initial targets for you to have any kind of viable probability that you are going to hit one or two that are going to work out.

Disha Gulati: That’s right.

Shubha Chakravarthy: This definitely resonates, that you don’t get more than one shot at many of these investors. They are all time strapped and they don’t want to waste time if within the first X number of minutes, they don’t feel that there’s a fit.

I have a couple of questions there. One, how do you make that judgment call to say that this is the right time?

Then secondly, for those who don’t have a starting network, what did you find effective to start building this?

Let’s say I start from knowing zero VCs and zero angels. Where do I start building that?

Disha Gulati: To answer your first question about knowing the time. You kind of don’t. I think by the time I had my 50th conversation, I was like, “Okay, I know in the spectrum of early state where this VC stands and what my ask should be of this VC. Is it just guidance and advice? Is it needing a check?” and this truly holds very true.

When you ask for advice, you get a check and when you ask for check, you get advice. It is so true. I think that comes a little bit by experience with trial and error.

If you are earlier, you have to do the research on the VC and see what their average check size is, what their minimum threshold is in terms of how much revenue you need to have. Even within that, what is their portfolio and who have they invested in? What stages have they been on?

You can arm yourself with that information, but then after that it is a little bit of fill out the conversation. I have not found a science or a model behind that. I would say you should do your homework and then make your best gut call there.

Second question is, if you are starting out with no network, that actually is more easily fixable today than it has been in the past. Align yourself with the epicenter of startup activity whether that is in your industry or the genetic nucleus in your city or in your industry.

For example, in Chicago, one of the bigger ones is 1871. I actually worked for 1871 for 12 months before I jumped in to this venture. The reason for that was that I needed to build this network. I was coming from consulting and corporate. I didn’t really know any VCs to be honest. I didn’t have a peer network of other founders that I could lean into to learn from. So, that experience gave me a glide path to successfully start the business.

I shouldn’t say successfully, as it just gave me a glide path to have a certain set of resources that I wouldn’t have had, had I not spent the 12 months at that incubator.

I get that not everybody has that luxury, but I think there are enough networking events and enough activity going on in these types of incubators where you could align yourself to the right quorum, to the right group, and start building your network.

I’ve said this before, accelerators are a good way to do it as well but be choiceful about the accelerators you sign up for. But that is another way to do it because then you become one of them and you are then a part of that group and then they take it upon themselves to help you out.

They will open some doors and always be networking. So, if you talk to an angel for example, and not the right fit, or even the right fit, then you say, “Hey, do you know other angels that also invest in this space?”

If a VC says no to us or that we are too early for them then we will ask and we will say, “Hey, do you know others who invest in our stage of the company?” The best introductions come from other founders, especially founders who are already in their portfolio. VCs, I’m told, hold those introductions in very high regard. That is another way to crack that orbit.

Shubha Chakravarthy: That is great advice. Is there one thing that you can mention about being careful about which accelerator you go to. I know we can talk for hours, but what is one thing you would ask?

Disha Gulati: The two things to be considered are, is it an effective accelerator? Will it actually add value and accelerate your path, as the name suggests?

For that, I would actually talk to prior portfolio companies. “You have been through the program, what was good? How did it materially help you accelerate your trajectory?”

The second thing I’ve seen a lot is the very sharky terms. So, that’s the other thing and it really depends on what stage you are in. It might be okay for you, or it might not be depending on how much money you have already taken in and things like that.

To the extent you can negotiate, I would negotiate, and I would be very careful about the terms. There are also accelerators out there that you can pay to be a part of. As a founder, I have not found that to be appealing,

Shubha Chakravarthy: You bring up a very good point, which is these terms and being able to first of all understand what you are giving and what you are getting, that is a big part.

Then secondly, being able to negotiate effectively what that exchange looks like is an even more important part.

My first question on that is, how did you get familiar with all the ins and outs and the terms like the cap table and the term sheet and all that stuff? What tips would you give to other founders who may not be as conversant?

Disha Gulati: I would say, get yourself a good lawyer, so that they can truly break down what the terms mean and how they would impact you. Not today, but four months from now, or 14 months from now, how they impact you at your next fundraise milestone. So, definitely get yourself a good lawyer.

There are a lot of templates out there, and there are classes you can go through. I believe YC or somebody has a whole course on understanding cap tables and things like that. Venture Deals is a great book to read.

But, I have an MBA from Booth in Finance and I thought I knew what was happening with these terms, but you just cannot know it all. I was like, “Wait, why don’t I fully understand this? I learned it in school.”

That is why I say, get yourself a good lawyer.  They have seen many versions of these. Then, to the extent you can use standard paperwork and contract paperwork and contracts do that. So don’t make it extra nuanced.

Shubha Chakravarthy: It sounds like a lot of that pressure gets taken off once you delegate it to the lawyers, at least from negotiating your terms because they will take care of making sure that you don’t get taken to the cleaners.

Disha Gulati: You don’t delegate it. What they do is they explain to you, “If you know this term materializes, this is what will happen”, or “This is what will happen. Is the outcome acceptable to you or not?”

You are like, “Okay, am I willing to take this outcome, even if there is a 10% chance of this outcome happening,” So, at the end of the day, you have to make those calls, but at least they can break it down and explain.

Shubha Chakravarthy: This is fair, and here’s my question to you. I don’t know if you can opine on it or not.

Let’s say they give you the choices and you are like, “Okay, I can make an objective assessment and say this is better than this other outcome.” One part that I’m having a problem understanding is where some of the biases come in.

How do you figure out what is happening, and which is normal for the industry?

Had there been no bias in question or no deviation from the norm, for lack of a better word, versus something that you are given as a set of terms that perhaps are not as equitable as they might have been otherwise? Is the lawyer any help in that?

Disha Gulati: Yes. The lawyer will tell you what they are seeing in the market. If you get yourself a good lawyer, I don’t mean like they have to come from a fancy firm, just somebody who is steeped in the start-up world and has seen enough term sheets or safe notes or things like that.

At the early stage, I think it is pretty standard. So, folks can easily point out if there is something that’s non-standard or untraditional or if someone’s trying to seek something in for various reasons, whether you are a naive founder.

Biases can come from your experience, it can come from your pedigree, it can come from your gender, from anything as you know. I think at the early stage, it’s easy to smell that out. The later it gets the harder it is to be honest.

The valuations folks were getting 12 months ago for companies our size are not the valuations we’re getting today. Is that bias? Are they just macroeconomic conditions? It is hard to tell.

So, I think it is a combination of both. Maybe I’m a female founder and a first-time founder. It is hard to tell. This is why I say you’ve got to get yourself a team and a lawyer for sure, but also advisors.

We have a set of advisors that we always go back to when we are doing the raise. We will be like, “Does this sound right?” In our case we have services, for example in our court. So, we always go back to their CVC arm and we’re like, “Does this paper sound right?” We go back to our lawyers.

We are also a part of an accelerator that Morgan Stanley runs. We are so fortunate to have that kind of brain power and think tank behind us to give us some very candid answers.

Whatever your board of directors is, or board of advisors is for this type of stuff, build it and get feedback from people before you send anything because sometimes I get it, the need and desperation for money is high, but don’t sign up for something where you give away most of your company.

Shubha Chakravarthy: One more question on the fundraising and the pitching itself – there is some research, some of it has been called into question about the preventive versus the promotional tilt in the type of questions that founders get asked. What was your experience talking to any kind of investors?

Disha Gulati: Lots of preventive questions, I would say. So, I am a female founder, and my co-founder is also diverse. He comes from the LGBTQ community and many times the resistance we get is not the same resistance a serial entrepreneur or say a white man would get.

We see it and it is true and it is real, and you just have to fight through it. I think we are getting better at it but it exists.

This is why less than 2% of funding goes to female founders every year. That number hasn’t moved in the last five years since I’ve been tracking it.

Shubha Chakravarthy: One other quick question on that, and then we’ll move on really quick to some of the more personal issues. There is this whole question around financial projections, models, and all of that stuff. You come from a very data driven – financey type of background.

I’m assuming that you are pretty comfortable with it. What I will ask you is, in what way have you found it most effective to use the financial models that you have developed and how do you leverage them strategically, both in your fundraising and pitching as well as potentially to set strategy and manage your own business?

Disha Gulati: It is essential for any business to have financial models both from a higher level, like the three-year plan, and all the way down to a monthly plan. For example, “This is what my marketing plan needs to do, and these are what the drivers are, and this is what my spend looks like.”

You kind of have to run your business by those models. Otherwise, it is very easy for the train to get off the tracks.

This is all science, but the art is presenting the right model to the right audience for the right reason. So, what is the model and what is the financial information you give to a VC that is still having initial conversations with you versus when they are moving into due diligence and they are wanting to look under the covers versus, somebody who you are taking the investment check from.

There are different complexities and different granularity of models that you need to have for those, and honestly, you don’t have to recreate the wheel.

I kind of started from a blank page, but I had enough templates and enough reference models to take into account because at the end of the day, we are in market business. We are an e-commerce business. There are many out there who can take inspiration.

The other thing is running your business on a monthly basis, even a weekly basis. We do your checking weekly with metrics and projections and it gives our team some idea otherwise what are they moving towards? Just doing better? How do you quantify what better looks like?

If we didn’t have it, I think they would feel really lost as well in terms of like, “What is it that they need to get to in the next quarter, the next year or things like that?”

So, of course it makes sense for us to have it from the sense of the general health of the business, but it also helps with moving the business forward.

Shubha Chakravarthy: As you go deeper into the conversation, is there a general rule of thumb in terms of what is appropriate to share at what point in the conversation?

Disha Gulati: Again, I don’t know if there is a rule out there, but earlier on when we have the initial conversation, it is like a slide that highlights some of the key numbers and the traction we’ve had and what we are aspiring to do in the next two years.

Once they start to look under the covers, there is a high-level model you can provide. Some say it needs to be hard coded, some say that you can give them some assumptions to play with.

This is where you have to use your founder’s spidey senses to be like, “okay, this VC is really serious and let’s just get to it and give them the model.”

Especially if you are really confident with the model, then you are like, “Here you go, play with it. It is strong. It is healthy. We know what we are doing.” That is what I would say.

Then finally, once they are in your data room, they probably want to see everything.

Shubha Chakravarthy: Fantastic. Moving now to the softer side, this has been a pretty interesting journey for you from the day you started right before the pandemic hit.

What have been some of the internal challenges that you faced and had to overcome as an entrepreneur and what did you find helpful in keeping you afloat and keeping you motivated and energized?

Disha Gulati: My goodness, where to start? This journey is a tough one. In the same given day, you will have had the most exciting conversation, as well as like the most depressing conversation. The highs and lows are crazy.

You have to learn to still your mind and your own self-talk, and you have to figure out how to validate success along the way because otherwise the success is whether the company lives or dies or whether you get VC money or not.

These are arbitrary goals that just get put in front of you. To be very honest, you don’t control all of those levers for the outcome. So, to then hold yourself to that bar, mentally, it is not a healthy thing.

You are going to always be in a very dark mood.

Shubha Chakravarthy: What are those internal validation methods?

Disha Gulati: This is what you have to say to yourself, “What are the successes you’ve had along the way?” For us, whether we live on to see another day in the last 17 months, we have built something in terms of a marketplace that has close to 200 creators and 800 products.

We have done over half a million in revenue. Nick and I started with a piece of paper, and we said, “Hey, I think we should build this marketplace.” I mean, these are things we should be very proud of.

We are conversations with the James Beard Foundation about playing a role with the James Beard Awards this year. It is one of the premier organizations in the hospitality space and here we are, this itty-bitty little startup who has a seat at the table and it is something we didn’t think was even possible 12 months ago.

I think you have to remind yourself and your validation has to come from within as opposed to externally. I think that is one of the biggest changes I have had to make in the way I think about it, especially in this world of entrepreneurship.

There are a lot of smoke and mirrors, like a lot of “fake it till you make it” ideas. If you go on LinkedIn or social media and see people going, “I did this and I closed this and I was here and this happened.”

You have to stay straight to your course and be like, “Good for them. I’m sure that is helping them get places” because how many I’ve seen somebody go, “Oh my goodness, we were on CNBC yesterday and then two weeks later, we shut down the company.”

So, you have to kind of adjust your emotions as it comes to how other founders in your cohort are doing or how other companies are doing and how they closed around or didn’t close around. Maybe they closed around, but the terms were horrific. What is the point?

So, the biggest lesson that I’ve had is, “How do you internally keep yourself motivated?” When I have rough days or down days, I think about two things. One is, “Would I rather be doing something else than this?”

The answer is, “I’d always be doing this than whatever I was doing before because this is way more fun, and this is what I wanted to do. I wanted to start something, I wanted to experience that.

The outcome of this experience is not just black and white. The outcome of this experience is everything I’ve learned along the way. I’ll become a better operator, a better person, and a more empathetic person than I was before.”

So, you have to remember that.

The second thing is to have the right support structure around you. It is so important to have the right partner, spouse, family, or whoever gives you that at the end of the day, the validation that the path you picked, the journey you are on is worth it.

That is the people you need to align yourself with and not the people who are like, “What are you doing? Why would you ever choose to live the life of an entrepreneur?”

There is a mixed bag even with family emotions that come along the way. So, I would say your manage your own self-talk. No one else can make or break how you mentally feel.

Especially as the leader or the founder of a company, it is very important for your attitude to be right because whatever is reflected on your face is reflected on the team. We are a small team, so you can’t really hide and the second is when you go home at night, you need to have the right support.

Shubha Chakravarthy: Let’s come back and talk about what have been some of the highlight moments that made you light up and say, “This is exactly why I’m here. This is exactly why I’m doing what I’m doing.”

Disha Gulati: Of course, the James Beard partnership is fantastic. The fact that we were on the Today Show, that’s national. I had people calling me that I haven’t spoken to in years, like “I saw Here Here Market on the Today Show.” That was a win for us.

Late last year, we made it into the Morgan Stanley Accelerator Program, which is very competitive. They take 5 out of 2,500 companies that apply each year.

It is an accelerator that truly helped guide us through some of our growing pains in the last six months. So, that to us has been phenomenal and we feel lucky and fortunate to be a part of that program.

Honestly, what keeps us going is when we get to talk to our creators and our creators talk about how much value we have added to their journey, to their businesses, and the exposure they are getting through us and the consumer base that they are building on Here Here Market.

Even the press they are getting through us, because again, it is easy to promote a collection of creators and a collection of products than it is to just take your one product and pound the pavement. We were in the Food Network holiday list in December, and we were the number one gift on their gift guide.

Shubha Chakravarthy: That is amazing! Congratulations!

Disha Gulati: Thank you! We’ve had a lot of highlights but what makes us is our creators. They just have such incredible product and such incredible stories to tell that it is easy to amplify that.

Shubha Chakravarthy: To conclude the last couple questions, what is it that you know today that you wish you knew when you started this journey?

Disha Gulati: I feel like every entrepreneur starts with some naivety and ignorance. I feel like if I knew exactly how this sausage was made, I don’t know if I would’ve started the journey.

But now that we’re on the journey, it’s totally worth it and I’m so glad to have done it. I don’t know if there is anything I would say I would’ve done differently because even the things that we didn’t do right, even the mistakes that we made, it is a test and learn process, right?

So, I don’t know if I could have built a startup with zero errors, right?

The only thing I would say is that, when you are a small team, the people really matter. We have been lucky to have a great team and I’ve been lucky that Nick and I like work together but be very choiceful about the people that you choose to take on the ride with you because that too could be a mental and financial drain, honestly.

Shubha Chakravarthy: Anything additional that you’d tell other entrepreneurs who are just starting out?

Disha Gulati: The struggle is real but honestly, I don’t think I’ve done anything more fulfilling than what I’ve done. I’ve worked for 20 years of my life, and I’ve not done anything more fulfilling than what I’ve done in the last 17 months. So, if you have the opportunity and the circumstances are right, take the leap.

Shubha Chakravarthy: Thank you. Is there any question that I wish you wish I’d asked you, but I didn’t?

Disha Gulati: No, you asked me a lot.

Shubha Chakravarthy: Of course. I’ve been accused of that before but let me tell you that this has been an amazing conversation.

Thank you for being candid. Thank you for being thoughtful and very helpful in terms of the experiences you shared, the perspectives you offered, and the lots of guidance and lots of value you provided.

So, thank you so much and we’ll be really excited to see all the heights that you and Here Here Market reach.

Disha Gulati: Thank you for having me Shubha! This is such an amazing platform and I’m appreciative of everything you’re doing with spreading the word around financial wellness and access to funding and capital for founders, especially female founders.

Again, we have got to do something to make the change.

Shubha Chakravarthy: I agree with you, and you are the stars that make it possible, so thanks for that!

Disha Gulati: It takes a village!

Shubha Chakravarthy: Awesome, thank you!