Jessica Ewing, co-founder, and CEO of Literati called the founding of her company the summer of the pivot.
She pitched so many different versions to investors including Etsy for authors, a curated enterprise book service for businesses, the first data-driven publishing house and others.
“You name it, I pitched it,” Ewing said. “It just kept getting crazier, crazier and crazier.”
Investors were not interested in books at that time, Ewing said.
“I might as well have popped into these meetings with a horse and buggy,” she said.
Ewing talked about her entrepreneurial journey with Lanham Napier, co-founder of BuildGroup, last Thursday at BuildGroup’s conference held at the Hotel Van Zandt in downtown Austin.
Ewing eventually decided to focus on children’s books. She founded Austin-based Literati in 2016 with Kelly Carroll. Literati is a subscription-based children’s book club aimed at children from birth to 12-years-old. Literati charges $9.95 a month for a curated box of five books. Parents have seven days to return the books they don’t want in a pre-paid envelope and they pay retail prices for the ones they want to keep.
In October of 2019, Literati received $12 million in Series A funding.
Ewing, a native of Michigan, comes from a long line of entrepreneurs. Her father and grandfather were both entrepreneurs. She went to Stanford University where she studied mathematics and artificial intelligence and when she graduated, she joined Google. She became a senior product manager.
In her mid-20s, she found herself in a bit of a dilemma.
“I was climbing a ladder, but against the wrong wall,” she said. “I just had a deep sense of unease that I was in the wrong city, in the wrong job, about to marry the wrong person.”
“It looks so good on paper, all of it, and my parents were so proud, but it just felt all wrong,” she said.
She decided she needed to change.
“The journey of entrepreneurship really begins when you are willing to break from the pack,” Ewing said.
Her first step on her entrepreneurial journey began when a friend at Google encouraged her to do an outdoor survival course. She signed up to do a 28-day course with the Boulder Outdoor Survival School, Ewing said. That experience gave her a tremendous amount of courage. It took her a year and a half, but she quit her job at Google to become a writer.
“I spent five years trying my hand at writing a novel,” Ewing said.
Life seems like a series of odd coincidences, but often when you look back at your life’s trajectory, there is an arch that suddenly starts to emerge kind of like a very well written novel, Ewing said.
That’s where Literati started, Ewing said.
When Ewing finished her novel, she entered the world of literary agents and publishing houses. She had to write handwritten letters to contact them. She thought there had to be a better way to organize the world of publishing through technology. She felt motivated to build something. The first version of the platform was to connect writers with publishers and agents, and it was called Excerpt, Ewing said. She put a lot of time, energy and her own money into creating it. Ewing built it from Austin because her brother lived here, and she moved to Austin to write her novel.
Ewing went to Silicon Valley to try to raise money for her venture.
“It was just a bloodbath,” she said.
She thought her background would attract investors. But very quickly she got shut down so fast.
“I didn’t understand the size and scale of what Sequoia would want to back,” she said. Sequoia, based in Menlo Park, is an early-stage venture capital company that has backed Apple, Google, Oracle, PayPal, YouTube, Instagram, and others.
Every day, she woke up and pitched her startup. She had a team at that point counting on her. She got so much feedback that she learned from every rejection and all the advice.
“It was so many no’s, but it was so many helpful tips, tricks, intros,” she said. “My definition of a great investor is not someone who writes me a check but someone who leaves me a little bit better off from having known them.”
Napier asked Ewing for tips for entrepreneurs looking to raise money.
The number one tip is you must be resilient, Ewing said.
“You have to be willing to change and grow,” Ewing said. “I wasn’t used to rejection before I started raising capital.”
“It’s really tough on your ego and it starts to sow seeds of doubt on yourself and your business,” she said.
Entrepreneurs must know what problem they are trying to solve, and they must really, really want it, Ewing said.
“You have to get used to the idea of rejection and reframe success,” Ewing said. “And you also have to try not to take it so personally.”
Literati is starting in kids’ books with plans to move into other areas as well, Ewing said. Literati is built around its community of people who love books, she said.
“It’s about being part of a community that is trying to raise your child in a world that has become very transactional,” she said. Literati is not going to compete with Amazon, it’s creating value in a different way, she said.
Literati wants to help parents raise a generation of readers who grow up with print books. It provides an analog experience that is an alternative to computer and mobile phone screens, Ewing said.
“I really, really believe we need to build technology that serves life and not a life that serves technology,” she said. “I still believe that books are these magic objects that carry a lot of value in the world.”