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Ms Romanow founded five businesses before turning 33 and has since been featured in Forbes ‘Millennials on a Mission’ list and named one of the 100 most powerful women in Canada. From caviar to her company Clearco, Ms Romanow spoke exclusively to Express.co.uk sharing what life looks like from the seat of a Dragon.
Ms Romanow saw her thoughts drifting to business and entrepreneurship whilst she was still studying to be an engineer: “I quickly discovered I wasn’t going to be a very good engineer.
“By the time I finished university I did a little research project for myself and figured out that worldwide supply of sturgeon caviar was down by 95 percent because the world had overfished the Caspian sea.”
This sparked her interest in the luxury caviar industry, turning down job offers to open a fishery on the east coast of Canada.
Unfortunately, the timing was against her as six months into her first business the 2008 recession hit: “I found myself being 21-years-old selling the world’s most unnecessary luxury product so I realised that the world doesn’t owe me very much.”
With deep resignation, Ms Romanow went to work in a traditional job for a large retailer when ecommerce was first starting, but traditional employment just wasn’t meant for her either – she left a year later to start an ecommerce business which became the publicly traded company Emerge.
“From there I built another app that was early in the AI space that Groupon bought in 2014.
“After that, I got a phone call to join the cast of the Canadian version of Dragons’ Den at 28-years-old. People would ask, ‘Aren’t you excited?’ and I was terrified. I was the youngest person there, I was the poorest person there and as a result of that experience I made the transition from entrepreneur to investor very differently.”
But this was not the end to her time as a market disruptor, as, without alerting the show prior, Ms Romanow made a legendary offer in the den that had never been seen before.
Speaking about the founders, Ms Romanow said: “When you look at it they were using the most expensive capital which is always going to be equity. Once you give up equity in your business you never get that money back. I remember talking to Andrew, we put our heads together and thought there has to be a better way we could do this.
“I came back on the show the next day, I didn’t ask anyone, and thought I’m just going to throw out a different deal type: I’m going to give you the $100,000 that you’re looking for but instead of taking 10 percent of your business that I’ll have forever I’ll have 10 percent of revenue until you pay back the capital plus six percent.”
This shocking offer left the founder questioning whether it was just a normal business loan, to which Ms Romanow explained that there was no fixed payment timeline, compounding interest or personal guarantee and most importantly no debt on the business: “If you don’t pay me back I’m not going to bankrupt your company. It’s a true revenue share.”
“That was the very first Clearco deal,” she said, referencing her latest company.
“In the last two and half years we’ve invested $2.5billion and so we make six percent on our capital. We’ve scaled the team from 50 to over 520 people. We have expanded into Canada, the UK, Australia and the Netherlands with many other countries that are coming so it’s been an exciting and wild time for us.”
Clearco, Ms Romanows latest venture, offers fast and affordable funding for ecommerce start-ups and while its figures speak for itself, it also has a unique selling point in the way they vet potential start-ups.
There is no pitch, no telling of the founders story or inspiration or how they started, the only thing founders have to do to apply for Clearco funding is show them the business.
Clearco only looks at businesses apps, websites and metrics as Ms Romanow strives to see VC funding stop being dependent on who the founder knows.
She said her mission is that: “Everyone that has a dream and good metrics can get access to capital. I don’t think the world is structured that way, I think the world is structured that when you know the right people you get the right capital.
“40 percent of VCs went to Harvard or Stanford, if you went to Harvard or Stanford it’s not hard to raise money for your business because you know the right people and it’s not because this industry was developed to be evil it was developed to be a human-to-human industry,” she explained.
“Because we’re just looking at those stats, when we look back at our portfolio our 5,500 founders look very different. More than 30 percent of the businesses we’ve funded in the UK have been founded by women. In VCs, 2 percent of capital goes to women. A third of our businesses are lead by POC founders and that to me is the mission.
Ms Romanow said entrepreneurs are potentially the best problem solvers for society, adding: “The number one thing that holds entrepreneurs back is access to capital. If you don’t solve the capital problem you don’t get very far. It doesn’t matter if you’re building a billion dollar company or something small that’s going to uplift your family and community.
“It’s hard to run a company this size as it was to run a fishery. You don’t know it all and you just have to have confidence in your ability to solve problems and figure it out.”
She shared some advice for founders looking to pitch to investors, whether it’s from a Dragon with a £112million net worth or an interested family member with some spare change.
“If you want to pitch to an investor the first thing you have to do is be prepared for a long process. Every time we try and go raise money we pitch 100 investors, if you want to get the best team you need a lot of people at the table. It’s an extraordinary amount of work crafting your story and getting everything ready. This last round we probably spent around 200 hours putting together a pitch-deck before Christmas last year, then we decided the story isn’t compelling enough so we spent another 200 hours after Christmas redoing the pitch.
“You have to try and get competitive offers at the same time, so you’re doing four to five meetings a day which means you have to take your eye off the ball and you should look for what you want to be the best long term partner for you. A VC is a marriage that’s not sexy at all. There’s no way to get out of it really once you’ve done it so you have to be very careful.”
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