When Poshmark was first rallying investors, Sun said she realized traditional fundraising routes weren’t going to cut it; lenders weren’t connecting to the vision of her business, and it was difficult to break past stigmas associated with women-owned companies. At Fortune’s Most Powerful Women Summit on Monday, Sun spoke about Poshmark’s trial and errors in fundraising, and how she pivoted.“We had to do things a bit differently,” Sun said. “The typical pitch was not enough.”She initially raised “a lot” of private capital for Poshmark, then decided to take the company public in January 2021 with an initial valuation of more than $3 billion. But that phase didn’t last long once Sun realized she couldn’t grow the company the way she wanted to while being public. Just a year and a half later in October 2022, Poshmark was acquired by South Korean internet company Naver Corporation for $1.2 billion and went private. She said navigating these different money-raising efforts was tough—especially as a woman business owner. She described going through “lots of different financial structures,” and that “every single one kind of sucked, especially when you’re trying to sell a company based on a mostly female experience.” Most of the investors she tried to lock down didn’t look like Sun. They were primarily white men, looking to throw cash at a type of project and leadership they’re more accustomed to working with. When she would try and level with them on the business promise of Poshmark, they would often defer to other women in their lives, thinking the online shopping industry is outside of their purview. “Most of the people you’re talking to have no idea what you’re talking about. Zero idea,” Sun said. “Then they would go and say, ‘Let me talk to my wife about this,’ and she might not even know. That’s a challenge, when the people that are making the decisions don’t really understand the pain point that you’re solving.”So Sun got creative, and revamped the way she approached fundraising. She recognized that if they could get investors to meet customers where they are, then maybe they could connect to the vision of Poshmark. Instead, they’d throw community events called “Posh parties,” traveling to new cities and bringing dozens of workers and customers together. At these events, people would meet one another and strategize selling on the platform. “Magic” happens at those events, Sun said, like 100 best friends who have never met, coming together. Investors joined in, and experienced the power of the company. “Whenever we go we’ll say, ‘Hey potential investor, come here. Come just witness the light that are on these customers’ faces,’” Sun said. “And when we get them to that event they’re like, ‘Okay, we don’t understand it, but there’s something going on there.’ And that’s usually how we’ve convinced people we have something special.”Recommended newsletter The Broadsheet: Covers the trends and issues impacting women in and out of the workplace and the women transforming the future of business. Sign up here.
