You learn how they did it, why they did it, and get exposure to (1:04) the world of exits. It’s a world occupied by a small few, but accessible to many. On this episode (1:10) of the exit, I sit down with Melrose Wild.

She’s a fantastic entrepreneur and investor. She’s the (1:17) CEO of Permaculture Capital and now Decision Society. This is a really great conversation (1:23) where we unpack all aspects of inclusion in the C-suite for women and all different types (1:30) of approaches to achieving that inclusivity.

And I think that there’s so many cool and important (1:36) knowledge pieces in this conversation that you’re going to want to listen through to the end. (1:42) Because not only does Melrose talk about the importance in data backing women being in the (1:48) C-suite, and how it is more profitable, and how having more people making decisions at the (1:54) C-suite is so vital. All the different backgrounds and thought, beliefs, everything coming to the (2:01) C-suite is vital for profitability.

And I love the data that she brings to the table here. This (2:07) is a fantastic, deep conversation about how we can really level the playing field and get more (2:13) women involved in business. Not only because it is just inclusive and really just how we need to (2:20) grow the overall pie of every industry, but it’s also just how we supercharge businesses based on (2:27) the data.

It’s proving to be more profitable. So, without further ado, sit back, relax, (2:33) and here on the exit, join my conversation with Melrose Wild. (2:37) All right.

I am here with Melrose Wild. And she is the founder and CEO of Permaculture Capital (2:56) and Decision Society. How’s it going, Melrose? Great.

How are you? Nice to see you. (3:02) So kicking things off here, before we get into your successes with Permaculture Capital (3:08) and everything, let’s talk about your background. What got you into business? (3:12) Yeah, so I have always loved business.

My first business was when I was 12. I had (3:17) a jewelry company. I sold beaded necklaces in middle school.

And I loved… And when I played (3:24) with my dolls, I grew up not with a ton of kids around on the street I grew up on, (3:29) because I grew up on a lake. And I would just set up stores and sell them to all my stuff, (3:32) sell things to all my stuffed animals. So I’ve been doing business since I was like 5. (3:36) But real business, I got into a long time ago.

I’m trained as a fashion designer. I went to (3:46) college for fashion design. I worked out of college for a year and was like, (3:50) oh, this isn’t as artsy and creative as I thought.

Started a clothing company. Years later, (3:56) I ran my own business, doing consulting for companies in the fashion space for many years (4:02) while I was professional modeling. I lived in 6 countries.

I’ve lived in 14 cities. (4:09) And I had a clothing company for 6 years. And that created a lot of problems and showed me (4:19) a lot of things that were wrong for women in business and fashion in general.

(4:26) So when I walked out of fashion, which I never thought I would do, (4:30) the whole world was open to me and I found my way into finance. It’s a long story, but (4:36) I’m here now and I love it. It was a weird ride.

But we can talk about that another time. But (4:43) made my way from fashion into real estate, real estate into placement agent work, placement agent (4:49) work into a large institution, institution to private equity, private equity to opening my own (4:55) shop. Very cool.

Very cool. One of my favorite things about getting into investing and really (5:04) backing entrepreneurs and getting involved on the investor side is having a thesis and having (5:11) things that are important to you that you can power, basically. You have the ability to (5:18) supercharge your core values and things that you value.

So what are the couple things that (5:25) Permaculture Capital, you guys focus on specifically when you’re doing investments? (5:30) So when I was at a large institution, Wirehouse, I worked with a pretty amazing wealth manager who (5:38) had about a billion dollars under management with about 50 matriarchs. And I was specialized in (5:44) alternatives. And one of the things I noticed when I was trying to show people alternatives was that (5:49) there were really very few female-led alternatives and none of them tracked sustainability.

(5:55) And there was a real window, a real hole there. But I didn’t quite know how to fill that. It (6:01) seemed like a really daunting thing that I wasn’t quite prepared to go out and build.

(6:06) So I jumped ship from there and went into a large private equity cannabis fund. And I realized there (6:15) that we really need to not only track and offer alternatives on a Wirehouse level, (6:21) but actually inside of funds, we need to be looking and digging into companies deeper. (6:27) And so I had this idea to start my own firm and offer three services.

We do full-stack investor (6:34) relations. We go out, we fundraise. We will also run sustainability planning, which is where we run (6:41) an SDG report and problem-solve for red spots or blind spots, help implement KPIs.

And then we (6:48) problem-solve. And instead of greenwashing, we’re actually solving problems early on in companies (6:55) so that we can market the work we’re doing, not just metrics because we bought carbon or bought (7:01) plastics crediting. We’re actually trying to solve for a lot of those problems.

“One of the biggest problems that comes up when you run the reports is inclusion. And one of the biggest problems I have when people come at me to raise money is that there aren’t women in the C Suite.”

(7:06) One of the biggest problems that comes up when you run the reports is inclusion. And one of the (7:11) biggest problems I have when people come at me to raise money is that there aren’t women in the C (7:15) Suite. And I got really burned by somebody last year, who ended up costing me over $60,000 because (7:22) they couldn’t close capital, CC’d my contact list, did a lot of terrible things to me and didn’t (7:27) apologize for it.

And it made me realize I’m operating as the only female voice in echo chambers (7:36) where losing $60,000 to most guys isn’t going to ruin their lives and ruin their businesses. (7:42) And so I just don’t even want to work with companies that don’t have female inclusion. (7:47) So we started recruiting.

If a company was open to it, we started going into my network (7:51) and asking women if they might be interested in going and working at places that don’t have (7:58) any women in the C Suite. And most of the women didn’t want to because they knew that they were (8:02) going to be going into echo chambers and that they were basically just pinkwashing. And pinkwashing (8:07) is a term I’ve kind of coined where it’s like, you’re putting a woman into a echo chamber, (8:13) you’re not listening to her.

So we tried to place really overqualified women, women with exits, (8:18) women who have had 20-year careers. They still don’t want to go do it for any amount of money (8:23) because they’re successful. And they’re like, why would I put my energy there? (8:27) That’s why we ended up building Decision Society.

We just need a place where operators can go (8:33) and work on what they’re passionate about and female founders can get what they need. So (8:39) we now have three verticals, investor relations, sustainability, planning, and inclusion (8:44) through Decision Society. And it’s a lot, but it’s actually targeting that whole (8:49) ecosystem that I was wishing I had at the institution.

(8:53) Nice. Very nice. I like the name too, just because people don’t really (8:57) often realize how many decisions and how rapidly you need to make them (9:01) in a business.

And I think it’s so accurate to kind of use that word in the society of people (9:10) that have to make decisions with unknowns all day, every day. It’s a good, it’s a really good. (9:18) As a small business operator running my clothing company, it was very lonely.

I contracted a lot (9:24) of people and I needed help making decisions. I needed a partner, I needed partners, and I (9:28) just couldn’t find them. I couldn’t find the right people to trust.

I didn’t know how to make (9:33) agreements with them. I didn’t know how to give away equity to them for their help without (9:38) over-diluting myself. I was so lost in the decision-making process.

(9:43) But I also didn’t want to name something just for women because (9:48) BIPOC and LGBTQ plus are in the same category of nightmare when it comes to (9:54) starting and fundraising for companies. So I don’t want to limit us to just women down the line. So (10:01) having a society of decision-makers and empowering people to become decision-makers (10:06) later is really the goal of that vertical.

Yeah, for sure. And I’d love to know a success story, (10:14) like maybe unpack a quick story, a notable one that we can talk about with putting a (10:21) woman in the C-suite and it changed the trajectory. It just kind of rocketed everything.

(10:26) Yeah, well, we’re pretty fresh. But what I’d like to do with this question, (10:33) instead of answering that right away, which we can answer that later. But what I want to (10:37) do with this time might be to discuss why we need women in the C-suite and why we need women (10:43) in business.

And it’s because the data is irrefutable now that not only do women invest (10:52) stronger and build companies with less resources that actually have better profits, but Catalyst (10:58) did a research project that they have since taken down, unfortunately. But I do have it. I can share (11:05) it with you for your show notes.

They did this huge research project and they looked at tons of (11:10) different resources and I’m happy to share it, as I said. But they found that earnings before (11:15) interest in taxes, internal rates of return, marketing value, operating profit margins, (11:20) stock returns, stock returns in recessions, they all have major metrics around better performance (11:27) because women are involved. Things like for EBIT margins, 25% more likely for gender diverse (11:34) teams and 28% more likely for gender diverse boards.

Organizations in the top quartile for (11:41) ethnic and cultural diversity among executives were 36% more likely to achieve an above average (11:47) profitability. At the other end of the spectrum, companies that didn’t have inclusion were 20% (11:53) less likely to experience profitability above the industry standard. That study alone is one of many.

(12:00) If you get an internal rate of return in a study of private equity firms in Europe and North (12:06) America, researchers discovered that buyout teams with at least one woman produced an average of 12% (12:12) higher in IRR compared to all male teams. The presence of gender diversity also contributed (12:18) to a reduced average of capital loss ratio of funds by 8% to 10%. There’s a ton of these, (12:25) and so when you start actually collecting data and looking at performance metrics, (12:30) to me, inclusion isn’t something that I have to balance out with profitability.

It’s actually (12:35) going to drive more profitability. Having more than just one voice that all sounds the same in (12:42) a company is incredibly empowering for your bottom line and your numbers. Women have been forced to (12:50) and build with a very small amount of resources.

When we do get resources, we go hard and we fail (12:58) less. For me, those numbers mean that we have to be doing it. Now, trying to do it within the VC (13:06) model and empowering women to do it is the reason we created Decision Society because (13:11) as a professional fundraiser who works with Series 7 and 63 licenses under a broker dealer, (13:17) who goes out into the marketplace and tries to raise capital for women, (13:20) I actually think it’s a waste of time.

I think it’s demoralizing and it actually is a waste of (13:27) our energy as founders. You could hire someone like me to go out and do it, but you’re going (13:32) to drain resources to pay a retainer and you’re probably not going to have a ton of success. (13:37) It’s why we’ve built Decision Society is to get women out of the very broken and abusive VC model.

(13:43) The VC model is not built for women. And I would dare to say that when we get the numbers back from (13:49) 2024, women will have had less than 1% of the fundraising because 30% of funds haven’t even (13:55) made a check this year and it’s already May. So I promise you the people that are not getting (14:02) investing are women.

And even with a male co-founder, like in the last 2 years, (14:06) you were still only at 16% of the money. So it’s just a bad model. It’s not built for us.

(14:11) It’s keeping us out. And then the worst part is when you go out to raise money as a woman, (14:16) you’re raising money for operations. You need marketing, you need financial organization and (14:23) projections, you need compliance, you need operations, you need technology.

(14:28) And you raise all this money and you go out and you hire somebody and they’re a bad actor and (14:34) they damage your business. And now you just gave all this equity to these VCs who didn’t place those (14:40) operators. So the system is very disjointed.

And when we fail, it’s really hard for us to get back (14:45) up, especially with bad actors. And there’s a lot of bad actors in operations. A lot.

(14:52) Do you own an online business? You can find out what your business is worth in under 3 minutes (14:58) with Flippa’s Intelligent Valuations Engine. If you’ve ever wondered what the value of your (15:04) business is or who would buy your business, Flippa’s Intelligent Valuations Engine can help. (15:11) Flippa uses key details that you provide, including business model, category, age, (15:16) page views, and compares all that data to thousands of similar businesses that have sold (15:22) on Flippa’s marketplace to give you an accurate and instant valuation.

This is key if you’re (15:29) looking for an exit. As the leading global platform to buy and sell online businesses with (15:35) the largest community of buyers in the world, and more historical sales data than anywhere else, (15:41) Flippa will provide you with an accurate indication of the price that your business (15:46) could sell for. And it’s all instant and free, which is a kicker here that can’t be passed up.

(15:55) Whether you own a SaaS business app, e-commerce store, blog, community newsletter, plugin, (16:01) and any other type of digital asset, Flippa can help you understand the value of your business (16:06) and support you on your exit journey. So get a free valuation on your business today (16:13) at flippa.com slash exit. Once again, that is flippa.com slash exit.

(16:20) That really answers why it’s needed, why getting women in the C-suite is needed. (16:28) So I always like to really have great examples because people listening to this, (16:34) both women and men that are operating companies right now, they’re scaling, they’re either (16:39) getting ready for an exit, whatever it may be. And they’re thinking about an executive team, (16:44) maybe to either replace themselves or hiring is a huge topic that people are always interested in.

(16:51) So when it comes to an example of how this can work really well, because you’ve defined the why (16:58) it’s needed, what’s a good example? Okay, so for example, we have a CPG company. (17:05) Women tend to start CPG companies. We see a lot of problems with the consumer markets, (17:11) and we try to fill them.

So I’ll start with CPG because you’re probably a lot of female (17:15) CPG operators would be listening to this. But at an earlier stage, the things that we’re doing (17:22) are a little bit different to what we’ll do later on. But we really are trying to be a one-stop (17:28) success shop for women who are founders.

So what they do is they come to us, (17:33) and we put them up in a portal. We include them on a newsletter. We also run research.

(17:39) Um, we will help them find operators on a time trade for equity. Now, what that means is that (17:48) an operator can come into our portal, look around at all the different sectors and different ideas (17:53) and companies. They can shop there and invest there as well.

But really, if they’re looking (17:57) and they think, Oh my gosh, I love this CPG company that addresses sleep and pain (18:04) and tinctures for beauty. I would like to work there. I wonder what they’re looking for.

You can (18:10) see what they’re looking for. And now if you want to work for them, we do check your background. (18:17) We do make sure that you’ve either had exits or that you have had career success or that you can (18:23) prove that you can hit certain metrics.

We serve as an intermediary who creates a negotiated (18:29) contract where we release equity to you as you hit certain metrics with your operations and your (18:35) performance. If you need funds to build something, it’s different. We would pay for the funds or the (18:40) company would pay for that, that actual process that requires funding.

Your time to build is (18:46) actually accruing and you’re, you’re getting equity released to you over six months, 12 months, (18:51) 24 months. We then just make a decision as a group. Are you going to join the company as a (18:58) partner in this operation, CTO, CMO, CFO, COO, CCO? Or are you going to cash out? And when you cash (19:07) out, you get paid time and a half.

So whatever you were making at your last company will pay (19:11) you time and a half for that amount of time, whether it was 3 months, 6 months, 12 months. (19:16) So you know coming out that you’re going to get it. Yes, there is a risk that the company is going to (19:21) go under.

But we don’t see it that way. We see that if you’re actually doing your job and hitting (19:26) those metrics in order to get the equity, that we’re going to be able to go out and fundraise. (19:31) Now when we get to a Series B doing this, or a Series A or B, then we don’t have to actually (19:38) worry as much about your equity being diluted by people that are just giving you money and (19:43) not helping you.

And then you can go actually go into your Series B and later stages, (19:48) much higher motivated. So you have a lot more skin in the game. As it goes later and you’re (19:52) going to exit or IPO, we as women, we’ve been forced to sell our businesses because we have (19:58) VC investors who are large equity holders and they force us to sell our companies.

(20:03) But when you talk to a woman about why they’re starting a company, most of them have the same (20:07) 5 responses. Every once in a while, you’ll find someone like me who really wanted to sell their (20:11) company for a couple hundred million dollars. But for the most part, you’ll get women who are like, (20:16) I’m trying to build a company for the generations behind me so that they can work in a non-toxic (20:22) workplace or work in a place that’s solving for this thing.

Very few women want to get (20:28) sell their company and then be banned from the industry that gave them purpose. (20:33) And then most of them are actually just trying to get income for life and solve problems and (20:38) help people. So the VC model, the investor model doesn’t always work if the women are not trying to (20:44) sell in 3 to 5 years.

So if they can hold on to more of their equity, we can actually spend those (20:51) times replacing equity partners versus trying to IPO or sell if it’s not the right fit. (20:58) Because a lot of times you’ll sell and you’ll get acquired and they just dismantle your company. (21:02) I mean, that’s a lot of private equity.

So if you’re going to sell to private equity, (21:07) you have to be really careful who’s buying your company because all that work you just put in (21:11) might just go into another toxic company. If you’re going to IPO, what’s going to happen? (21:17) How are you communicating to your investors? What’s going to happen when you have quarterly (21:21) reports and you have to show numbers? So it’s all these things really matter for having the (21:26) right financial operators, having the right operators. So I just am trying to find people (21:31) who are passionate and like to operate with the companies that are doing those things.

(21:36) And this feels like the right way to do it as we grow and change. Maybe we’ll have education (21:40) around operations later. But right now, we started with a newsletter.

We’re running a (21:46) lot of research projects right now. And we’re going to be a portal where people can come. (21:51) And it doesn’t have to be just women operators.

We’re open to fractional operators. In fact, I (21:55) think what I’m learning is most of the fractional operators that we’re getting aren’t women, (22:01) because women don’t have the luxury of having made a ton of money in their career unless they’ve (22:05) exited. So they’ll probably be one out of every five operators that we place in these companies (22:10) will be women.

So it’s not just for women from an operations standpoint. But you do have to (22:16) work and prove that you can do the operations because we’re no longer paying for people who (22:21) say they can do things that don’t do it. Yeah.

And I think a great emphasis here is on mentorship (22:28) for people listening to this just beyond just the platform that we’re talking about, (22:34) but just in general. If you’re running a company, having a mentor that’s gone through something (22:39) that you want to aspire to go through is the best education. It’s the best way that you can (22:45) figure out what you want to do, what you want to achieve, and learning from someone is the source.

(22:50) The real problem with mentorship, like when I was looking for mentors, (22:54) none of them looked like me, sounded like me, smelled like me. They were all men. And they were (22:59) it was demoralizing raising money for my company.

I was talked down to, I’ve been talked down to in (23:05) every job until I started my own company. But it’s not just being talked down to, it’s being told, (23:10) why don’t you go and do this instead? Or why don’t you just get married? Or why don’t you, (23:15) why don’t you, why don’t you instead of how can I empower you? What do you need besides cash? (23:22) Maybe you need better accounting. Let me show you how to do better accounting.

Or let me sign you up (23:27) for the Harvard prep core classes or some anything. But when the mentors don’t look like (23:33) you and they and they often want to sleep with you, it’s a it becomes really problematic. You (23:38) know, the other thing with mentorship that can go really awry is, is that you can not like I don’t (23:47) think people structure the setup, right, right.

I think you have you really want to make sure that (23:52) you’re asking them for a set amount of time and putting the meeting in your calendar every month. (23:56) Otherwise, you don’t get that, that flow that’s coming in and men, people mentor because they get (24:01) a lot out of it too. It’s not just for the mentee.

So you really want to make sure you’re finding the (24:06) right person. Unfortunately, a lot of women who have had a ton of success in business have just (24:12) been emulating their male teachers. And so they’re not actually coming to the table with those natural (24:18) female instincts, like, you know, nurturing before selling or, or just caretaking for everyone in (24:26) your organization or the mother instinct.

And you don’t have to have kids to have the mother (24:31) instinct. In fact, I think a lot of women who haven’t had kids who are doing businesses, (24:36) think of their businesses as their babies. But that mother instinct doesn’t lie.

And it’s a real (24:41) those things that can be seen as, as super female can be super powers if you allow yourself to use (24:49) them and feel them. But as with anything, you know, you have to be careful because as we know, (24:54) with fire, it can either heat things up or burn things down. So if you’re going to go into those (24:59) deep female qualities to run business and try to find women mentors who have used those things, (25:05) it’s just a smaller group of women that have been successful at that.

So we have to be careful of who (25:10) we’re emulating in business. Yeah. And with Decision Society, specifically on the fundraising (25:18) front, for people listening, how, how are you guys really approaching that when somebody’s (25:25) joining and they’re trying to actively raise around? Is it more of like a, a mentor kind of (25:34) program or what’s the structure like for them? We, we, if someone’s at a seed raise, like, (25:40) because I work through a broker dealer.

It’s really hard to raise early stage money right now, (25:45) but really almost a waste of my time. I hate to say that. So I’ll send the seed or the idea phase (25:54) out to referral partners and I’ll try to loop them back for a series A or series B or beyond.

(25:59) But I’ve actually really created Decisions Society to move the needs of my female founders (26:05) into Decision Society and try to get them operational help. The funds that I’m raising (26:10) for and the companies that I’m raising for are hosted in an investor portal on our website. (26:16) You have to be accredited to enter and you have to have some kind of trackable name.

Like if you (26:21) can’t just like apply and like have a password sent to you, we actually do backend due diligence (26:26) checking to make sure you are who you’re saying you are in order to go into our portal. Once you’re in (26:30) our portal, you can view by sector, all the different things we’re offering. We have about (26:35) 20 clients right now and, and you can go to your doc, the docs and, and you can get decks and you (26:41) can see marketing videos.

So I’m kind of putting it into a place where you can go and explore (26:46) and we can cross market. We also create a fundraising strategic partner list. (26:51) And we reach out to strategic partners who are in my wheelhouse from six years of talking to (26:56) investors, as well as new partners.

And we just call and talk about them. Unfortunately, (27:01) it’s taking me a while to get three or four women who have their series seven and 63 licensed. (27:08) So I’m the only one who can solicit materials.

So if anyone’s listening and has a series seven (27:13) and 63, I would definitely love some partners in the outreach, but it’s hard for the women, (27:19) you know, we were so degraded in the process of raising money that I just don’t know if it’s (27:23) great use of our time. Yeah. Raising money is, (27:26) is very, very skewed and difficult.

And everybody that I’ve had on the podcast that’s talked about (27:34) just the imbalance that’s taking place currently is, is pretty, pretty wild. The numbers are (27:41) staggering. So I’m, I’m hopeful that everything that you’re pushing can eventually help even the (27:48) playing field for, for women listening, currently operating and just in general, (27:54) but that takes us to the finale.

Knowing what you know now, what would you tell Melrose 10 years ago? (28:00) Oh, gosh. Well, what I’m building didn’t exist 10 years ago, which is why I’m building it. (28:07) I guess I would have said, why are you building this company? And, and, and why do you need money? (28:12) And if you need help with operations, if you need to scale, you know, how can you find the, (28:20) the right partners? You know, I just became an expert in institutional finance essentially, (28:25) because I was so perplexed by the problems I faced.

And I could tell that it wasn’t just me (28:31) or the sector, which it was both of those things. I definitely needed to have better (28:35) systems in place. And I, you know, retail was dying in 2015 when I went out for capital, (28:40) but do you want to pivot or do you want to problem solve? If you’re going to pivot, (28:46) what do you, what problem are you solving for future generations that can give you purpose (28:50) and you can have an insatiable curiosity.

If you’re going to push and you’re going to try (28:54) to raise capital, why are you raising capital? Where’s that money going to go? (28:58) And is there a better way? Would you rather give your equity away to partners who can prove that (29:05) they can advance your business or to VCs who are going to just take a shot in the dark with you (29:12) and not give you a ton of resources, try to find accelerators, try to find programs that will take (29:17) equity, but help you, you know, hopefully we’ll go out. Hopefully we create a fund of funds for (29:22) the investor portal and we raise a fund for operations down the line. And it’s every day, (29:27) it gets closer and closer because we’re so frustrated with the process.

But (29:32) what I would have told myself 10 years ago is, is what I did tell myself, which is, (29:38) unfortunately, this life purpose I’ve had to design amazing clothes didn’t fulfill me enough. (29:43) And it was, I did need to pivot. So you have to decide if you’re ethically aligned with what (29:47) you’re doing, if you’re curious enough about what you’re doing, or if that thing you’re doing is (29:52) just a passion hobby that you should do on the other side.