Tractor Ventures Co-Founder & Co-CEO Jodie Imam sits with us to discuss the Tractor Ventures growth journey, after Matt Allen spilled all in our previous article. Jodie details to Gaz Williams what the purpose of Tractor is, the importance of being present in the ecosystem, and her personal motivations in seeing Tractor fund many more women-led companies as the years go on…
Gaz: Jodie, welcome to Tractor-Talk. So obviously, I know a bunch of your backstory seeing as you and I would frequently turn up at a decent amount of events in Aus and NZ…but I would love to do it proper interview style today so we can share it in written form for once.
What’s the career background for you, before we lean into the Tractor trajectory?
No problems at all - I finished my marketing commerce degree and went straight into the corporate world, worked for IT and Telco companies for 3 ½ years, until I found the corporate life destroying my soul.
So I ran away to the fashion industry for nearly 10 years and built a business in fashion design. We grew to 25 stores with 100 staff all across Australia, plus Hong Kong, LA and London. After that, I was ready to start my life as a startup entrepreneur.
My first startup was called Occasional Butler - it was a platform marketplace for getting jobs done around the home and office back in 2012, when marketplaces weren't really a thing yet, especially for services. Built that from scratch, built the community from scratch, learned all the things the hard way, and eventually sold that to Airtasker in 2014, experiencing the exited founder life.
Not for long though, as at the same time, I started one of Melbourne's first co-working spaces called depo8 in Prahran, which my co-founder and ex-husband and I ran for eight years profitably, building organically over time to over 100 members, until COVID hit and we had to make the rapid, and brutal decision to shut it down.
Since selling Occasional Butler, have done a whole lot of work in the ecosystem, from mentoring to investing, to advising with the SBE Accelerator for women-led businesses. Started up Innovation Bay here in Melbourne, became a Startmate mentor, joined Wade Institute of Entrepreneurship as a mentor, lecturer and involved in the practical subject of the Master's Degree in Entrepreneurship. And then, 3 years ago…Tractor!
Joining the Tractor mission
It’s a great career story Jodie - ebbs and flows, some of those past business ventures also present in Tractor I note (past coworking residents now investors of Tractor for example).
So, let’s talk Tractor. Why?
Yes, it's funny! I look back and it feels like all the different things I've done in my career are all the perfect background to this role and Tractor. I met Matt Allen probably six years before we started Tractor.
He came along to the Innovation Bay events. He was always very supportive of all the things going on in the ecosystem. He introduced me to the Startmate community, and so we started bumped into each other a lot as we were running in similar circles. Then, we started advising together on different advisory boards for startups, and got to know each other even more.
So, when he was mulling over the idea, he thought of me as a component of the initial team to, I guess, really execute and come in and run the thing. So when he told me I thought ‘oh my god, this is so good, I wish this had been around when I was starting my businesses’ and as a bootstrapped founder, it really resonated and I wanted to join that mission of helping founders with different types of capital.
The evolution of a company…
And how has Tractor evolved since then in your mind?
I mean, right at the very start, Matt was at an Unyoked stay, we organised to catch up in Kyneton at this Unyoked cabin, and when there, we were discussing…you know, what I might be doing when we got started with Tractor.
I thought ‘I’m not fully sure - we will set up a CRM, track sales, grow the brand…’
Then, we launched with an AFR article talking about what we're doing, and the link on the website flowed through to my calendar.
Almost instantly, that calendar was filled with founders interested in finding out what this new type of capital was about. So I spent the early days with lots and lots of education, and still do to be honest.
And then, we started converting those early calls into investments. For founders, we got to about 10-20 founders that we were able to provide funding for. Before that, it just got too much for me to manage both - the advisory and support side at the same time. Enter Gaz Williams *audible hysterical laughter*
*Gaz distinctive laughter (Loud)*
I mean, right from those early days, there's been a lot of refining what we're doing.
We've now built a very large community of founders, with over 160 companies worth of founders that we’ve funded.
And we’re matching them now with growth partners to support their journeys, where we've been very focused on building up our loan book, which currently is at $60million in loans written to founders the last 3 years.
Has it changed? I mean, the team has grown to 20 people from the initial five of us. And we've had an organisational chart shift on the way as well. Originally, Matt was the CEO, I was the COO, Aprill (*note- our other Co-Founder, featured next) was the General Partner. That kind of wasn't really working out.
So we shifted it to Matt and I sharing the CEO role as Co- CEOs. Aprill stepped into the COO role. And we've literally just this week bought on our CFO to complete that C-Suite. We also, in the last year, bought on an external Board Director to help guide us on our future direction too.
The evolving market for Tractor
And what shift have you seen in market as the journey of Tractor has continued? In terms of hearing the market, perceiving the market, feedback etc.
I mean, in the last couple of years, we’ve focussed heavily on being face to face at events, hosting events, really getting to know founders and telling them about this alternative funding structure. We’re educating about different types of capital and when to use what types of capital.
In all those gatherings, definitely work, what types of capital and in that in all of those gatherings definitely there’s been a shift from, an interest or curiosity, to much more of a seriousness of when and how founders should use this funding, as opposed to ‘What is it? That’s intriguing!’
That's been a big shift that's come at the same time as a real downturn in equity markets and the VC world, so the timing has been good for our brand to grow in the market and help a bunch of founders access capital in a different fashion.
I’d love to talk lightbulb moments with you Jodie: what are a few you can remember in the short time we’ve been in market?
I think the last financial year leading up to June last year was a ‘holy shit, hold onto your hats’ time.The growth was phenomenal. That intersection of the timing in the market and our readiness to help. You know, we grew by…what was it 4,000% almost that year?
So, we were very much building the plane as it's flying. So that was definitely a memorable time. In that time, there were a lot of those lightbulb moments.
We had started with a bespoke advisory component as part of our initial loan offering, and that could no longer keep up with the scale. So, that was a situation where we an another idea we had to sunset, to come up with a more scalable way of providing that support, which we’ve now done by onboarding growth advisory partners.
And then, receiving recognition such as ‘fastest growing company’ leaderboard status in the AFR recently. We’re doing something right.
There’s definitely a market for what we do, na we still talk internally about whether we’ve found product-market-fit or not, while we’re still striving for excellence all the time. We probably haven’t found exact product-market-fit, but certainly with the recognition and the growth, it validates that there is a problem to be solved.
The People, The Culture
What's on top of your mind when you think about the team, the people building this mission, the culture that takes?
Especially at this point in the year, being early Feb, it’s just getting very aligned and focussed on short term goals as we set up strategy goals to address our Big Audacious Hairy Goals in the next five years. Making sure that in December this year, we can all feel accomplished and know that we achieved all we set out to achieve.
That’s the goal, the mission aspect. In terms of people building the Tractor, we have a very strong focus on staying as lean as we can. Our hiring policy has always been to hire senior people that, you know, can really straddle probably 3 roles in 1, as opposed to having to train and build up more junior people and that’s definitely been one of the key things that have driven our speed.
We work a 4 day work week, we have fantastic work-life balance, but the focus is staying lean and keeping that senior lens on things from our end.
Developing Leadership Skills
What about personally Jodie, if you don’t mind opening up, regarding how your leadership, or leadership style has developed? What have you recognised in your Tractor time specifically?
Because of the speed I’ve been forced to push out of my comfort zone as I challenged myself and was challenged, I then leant into my natural style of leadership.
Which is to lead by example, with vulnerability. So I've just been, I think, more and more open about all the things going on as a human as much as I can to build trusting relationships with everyone, and I’m trying to lead by example on that front!
Tech, and the scale it brings
OK, hard U-turn for a moment. The Tractor tech - tell us about it…
So, we started with a loan securitisation platform, which was initially what our technology was going to be, until we learned that it actually can be a lot more!
Now it’s on the path to being a complete end-to-end platform where companies interact and get funded by us initially, then interact with us right through to when loans are being paid out, access funds on demand, and the whole Treasury function behind the scenes.
So it’s very exciting, especially as we being in AI specialists and we really really lean into technology, as we do as much work as we can with the right amount of people in place.
A Tractor funding story of note
I asked Matta this one too- no favouritism, but is there a Tractor funding story that a great one, in your mind?
Well, I'll have to say Girls Get Off then. I love them. I love their mission. I love that we can help support a company that has so many barriers to operating because of the nature of their business, but what that unlocks for them, and the world, is very exciting.
And their type of business is…
An ecommerce business I guess really, focussed on product based sexual wellness.
The problems that keep founders up at night
We do love funding those sextech companies, that’s for sure.
Speaking of being kept up at night: what are some of the thoughts that are on founders minds, that they communicate to you as you roam the country, these events, these calls, these forums etc and meet many of these founders in person?
So yes, because I’m sort of the one out and about on the ground, the conversation is often about capital, and what the next bit of capital is, and how they’re going to get it, and how much and how that’s going to help them grow and scale, and sometimes survive.
Also, and this might be my personality, often the mental health challenges and the personal growth that's required and that struggle, and, you know, team culture building and the stress of having everything on your shoulders especially, so having founders so my founders that have those conversations is quite important I think, and healthy to have.
Importantly to me, I naturally gravitate to women founders, having been involved in the world of women entrepreneurship over the last 10 years. I'm excited that we can actually move the needle and actually invest in more women, through Tractor and then also personally, with my thesis for angel investing focussing on women. All the signs point to that being a wise decision.
That’s a strong focus for us at Tractor and we will always invite any woman founder to talk to us at any stage.
Storytelling when building a brand
What's the main storytelling tool that you use when it comes to funding? What's the specific mindset that you advocate for when thinking about capital?
Definitely the weighted average cost of capital and what capital they use at what time in the business and to think about capital over the whole lifetime of the business, not just that initial raise. I personally fell into that trap of just being very caught up in the initial raise, or the next raise or whatever, but it's to be mindful of all the capital needs of the business and what that would look like for dilution over time.
Purely so you are not stuck halfway down the track with not enough equity to attract more investment, and not enough of your own personal equity to attract more investment, which basically can kill the business.
So, it’s just thinking about using different types for different purposes. Selling shares, for example, to hire a salesperson is madness nowadays with companies like Tractor being able to provide non-dilutive capital for revenue growth.
What comes to mind when you think of the term elastic capital Jodie?
Well, that's being just flexible. Using capital flexibly, choosing options where you can have flexibility in the capital that you're choosing. So instead of being locked into some stringent metrics, based on a lot of equity coming with high expectations. And so, it’s flexibility that springs to mind.
The future for Tractor
And what does the future hold? What’s on the immediate roadmap for you?
Our path to profitability. We're very, very close to cash flow neutrality and an infinite runway and that's exciting and then from there profitability, so that we have the control to make the decisions that we want to make for Tractors growth going forward.
Connect with Jodie Imam on LinkedIn