Welcome to the F3.
Female Forward Finance.
I'm your host, Jill Faherty Lloyd, a financial advisor at
UBS Private Wealth, and I'm on a mission to help
women have agency with their capital.
The F3 is the space for real conversations about money,
power, and everything in between.
You'll hear from experts, entrepreneurs, and everyday Janes about the
choices they're making when it comes to their wealth.
These are critical conversations because women are earning, building, and
shaping what comes next in the world, and it's time
we own every bit of our power.
In this episode, I speak with Cate Luzio, the CEO
and founder of Luminary, about scaling with intention, mastering your
numbers, and knowing exactly when to say yes
or no to a sale.
Whether you're years from selling
or weighing an offer
right now, this conversation is packed with candid insights and
actionable advice for founders who want to
exit on their own terms.
Let's dive in.
Before we dive in though, I want to talk a
little bit about an idea.
Imagine if you will, a three legged stool.
If one leg was missing, the stool would topple over,
right?
Similarly, when planning to sell your business, you need to
focus on three key areas.
You want to maximize the transferable value of your business.
That's leg 1.
You want to maximize your personal financial wealth, that's two.
And you want to have a plan for your what's
next?
And that's three.
Today, I'm particularly excited to host Cate Luzio, the founder
and CEO of Luminary, a gender inclusive Global B to B
and B to C professional education and networking platform driving impact
for individuals and enterprise organizations through its engaged, diverse community
and robust suite of tools, resources and services designed to
support all phases of a person's professional and personal journey.
And like many entrepreneurs, Cate is growing her business for
an eventual exit.
Welcome, Cate, I'm so happy to have you here.
I'm so happy to be here Jill thanks
for having me.
It's my pleasure, I would love to start by you telling
us a little bit about your background and what forced
you or caused you or made you want to start
Luminary.
I think I didn't know it, but I always had
an idea of what community meant to me just starting
out, not just my career.
But when I was little, I
fell into finance.
I was recruited into finance.
I was working at a startup.
This is back in the late 90s, and I got
recruited into finance and it was never something that I
had a plan for, but I ended up loving it.
I loved, I really did,
I truly loved working.
Majority of my career, almost 20 years was in corporate
banking.
Love the client side, love the people development side, but
like many of us on the side of my desk,
I was mentoring others, not just women, but a lot
of women just because they saw me as a senior
woman.
I was building community inside the company through our
networks, our women's networks, our ERGs.
And at the same time, especially as I, my last
couple of years, I was watching this explosion, if you
will, of small business owners, entrepreneurs, founders that were seeking
capital, seeking support, seeking resources.
And yet a lot of the conversations that I was
having with both my clients as well as the people
inside the organization, and then sort of again, outside these
business owners, fundamentally they were seeking community.
They were seeking people to bounce ideas off.
They were seeking mentorship.
They were seeking education so that they could invest in
themselves, whether that was their professional development, their skills,
their businesses.
And so in 2018, after a very pivotal conversation with
one of my amazing mentors, who's still a mentor, he
said, what do you want to do with the rest
of your life?
Because you can do whatever you want.
And here I was 42, thinking, but this is what
I do.
And it had never occurred to me because I am
a traditional Gen Xer,
I think,
it's just the next thing, the next thing,
the next thing.
And there's nothing wrong with that.
So let's be very clear.
But I took a step back and thought, what do
I want to do?
And one of the other things that he said that
I'll never forget was you want to have impact in
everything that you do.
How do you do that in your job?
And so a few weeks later, not that long later,
I wrote a business plan and that eventually became Luminary.
8 months after writing that business plan, we launched the
physical side of the business, which is in New York
City.
So it was a very compressed time frame as far
as writing the business plan, saying I'm getting out of
this thing that I've loved for almost 20 years and
never say never, I probably will find my way back.
But launching this business and deciding that I'm going to
do it on my own, I used my own capital,
and there are lots of reasons for that.
Well, let's go into that because there are many forms
to finance a business in many different ways.
And I meet many different women who have built businesses
through, you know, revenue, through grants, through
friends and family, through angel,
through venture, right?
So tell me why you decided to self fund?
So #1 I had the capital available, right?
And that that's a privilege.
And that's a privilege of, of working for, you know,
20 plus years and saving money and putting that money
work to work for me in the form of
lots of bonuses.
And so, but I worked really hard for that.
Two, when I did my financial projections, which I put a
exclamation point behind that because I think a lot of
people start businesses and think this is a great idea.
We'll just see what comes in.
No, you need financials and you need financial projections.
And so one of the reasons I did that was
to see how much money upfront would I have to
put up if I wanted to do this on my
own?
What was the runway of that capital?
And then if I ever decided to raise, what did
that actually mean?
The second reason I did those financial projections was I
also wanted to see, could I create a business that
was self-sustaining and that was profitable and how long did
I realistically think that that was going to take?
The third is I didn't want to wait and we
know how long it can take for the fundraising cycle.
Now in 2018, that was a pretty good cycle.
There was a lot of cash in the market.
It was pretty cheap, but I am not, until
you know me a little,
I'm just not someone that can wait when I see
an opportunity.
And so I thought, I'm going to strike while the
iron is hot,
I'm going to use my capital and then if I
know what I think, I know if I decide to
ever raise, it's going to make it that much easier.
You'll own more of the company exactly, and you'll have
to sell less of it.
Exactly.
And I will hopefully have and and I do have
a profitable sustainable business that the revenue that we generate
one yes, of course some of that goes back into
my pocket, it goes into my employees pockets and it's
able to reinvest in the business like our acquisitions.
I want to talk about the acquisitions because if we
go back to this notion of the three legged storm
and maximizing the transferable value of your business, I think
there was a moment that you shared with me where
the light bulb went off on how could I, how
could you, Cate, maximize the value of luminary?
Yeah, You know, I was watching all of these other
founders and I have the again, I think it's I
don't know if it's luxury or the privilege.
Because of what I did for many years and because
of the the network that I had to tap into
and the skills and the resources, was I did not
want to be in a place where I was constantly
proving
but also just building for the sake of building.
So we, I talked to a lot of founders.
I use the example of my friends over at the
Glow Recipe who have built just an incredible business and
they did it very differently.
They did that.
They bootstrap for, I like to call it stiletto strapping
because for women it's harder for lots of reasons.
Dancing backwards in heels.
And they went the private equity route and I watched
a couple of other peers, let's call it peers in
our category.
And I just knew I wanted to build it differently.
I also again going back to this idea of profitability,
you know, in 2018, no one was talking, no one
was really even talking about profitability until probably the last...
2022. Exactly when you couldn't raise.
When you couldn't raise anything.
And the other thing that I saw was, one, I
was approached about potentially selling the business.
And two, I had already done our first acquisition and
realized that was extremely accretive to the business and I
could continue and we do continue to build organically.
But then why would I go out and build all
of these things if they're already in the market?
And could I build a business a different way by
buying and bolting on?
And that became our strategy.
So you bought... how many acquisitions have you done?
We've done 3.
You've done 3 and you have been approached to sell
the business.
Why did you decide not to sell?
Well, first I will say for anybody listening that that
thinks, well, I don't know if I ever want to
sell or I don't know if I can sell or
I don't know if I can require... take every
meeting.
You know, it's really important to understand your options.
For me, I will say when I started the business
back in 2018, we really formally launched in early
2019.
I didn't think I would ever sell a business.
I thought I'm going to build this and it's going
to be my legacy.
By the way, you can have legacy lots of different
ways and I've figured that out over the last
six years.
But as we started to build and we looked around
and saw many of our peers were not doing as
well.
By the way, I wish they all were doing
well.
We need them to be in this category.
I decided that maybe this was a business that could
grow to sell and doesn't mean I'm going to be
out of that business.
But when I was approached, and this wasn't that long
ago, I really just said let's have a conversation because
what is that going to do?
It's a great learning opportunity.
And as business owners, as leaders, we should always be
learning.
You never know it all.
And if you do know it all, then you shouldn't
be in the business anymore because you're not challenged.
And I took it as a great learning opportunity.
We ultimately decided with the potential acquirer that the numbers
didn't make sense for lots of reasons on both sides,
and there was a different path that we wanted to
go on, and I think they wanted a different path
as well.
And we parted as friends.
But I learned a lot and I will pull on
that experience probably for the rest of my life because
of what I learned in that process.
And the other thing that it prepared me for was
to have even deeper discussions going forward with other potential,
whether we're requiring or we're being talked to you about
funding, which we get quite regularly now.
Well, one of the things that's critical for founders, particularly
as they're starting to scale business, actually has tremendous value,
is to build a team.
I love it, right?
And I think that was something that was a great
experience for you as you went through the process, even
if it was in the mental arithmetic around does
it make sense to sell?
So how did you go about finding your team members
and who were on them?
Yeah, and this is so critical again, whatever stage you're
at, you know, I've said since the the day
I started talking about Luminary, you have to have a
banker that you trust.
We'll talk about financial advisor in a second, but a
banker that understands your company and the needs of your
company and how you're going to grow the company, an
accountant and a lawyer.
All three of those people that are an extension of
your team are there to help you and protect you.
The 4th person, especially if you are thinking about if
you have raised, this is I think an
absolutely must have and or if you were thinking about
exit, you need a financial advisor.
And I will tell you when I started to think
about this, it was my lawyer that told me, hey,
have you already started talking to your financial advisor
about if this moves forward?
What does that mean for you?
It was so pivotal because that was the last thing
on my mind.
I was focused on the business and the growth of
the...
What are we?
And it was so eye opening.
So I really appreciate that our lawyer, and
he's great, said you know, go talk to a financial
advisor.
And so even though we didn't move forward, it was
super helpful.
And now I will not have any conversation about the
business and proceed to the business without pulling in
my financial advisor.
Yeah, that's the second leg of the
stool right?
Exactly.
Maximizing your personal financial with having the agency of knowing
what your number is.
And if you know that it costs you, oh I'll throw out $1,000,000
a year to run your lifestyle, you got to make
sure that you exit with an enough money to put
in the bank that can generate that type of cash
for you.
So you're singing my song.
And I do think, Jill, I think people often
think, well, it's not that time yet.
There's no time like the present to also
just educate yourself on the process.
So it doesn't hurt anyone to have that conversation and
to learn.
And I think even before you are thinking about an
exit, talking to a financial advisor about how much is
your take home, what's your distribution every month?
Because I think for people that leave corporate and they
go from a bi weekly salary to I'm not getting
paid maybe in those early days, to how much do
I take, how much do I take home?
Understanding what eventually you want your lifestyle to be, how
much you want to save for retirement, because most small
business owners and founders don't all of a
sudden start an IRA.
They're focused on putting the money in the business.
So I think having those conversations earlier is really important.
Well, I think maybe your background in corporate
banking helped you look at, OK, understanding your business cash
flow, but this experience helped you think about your personal
cash flow.
100%, 100% and it was definitely taking a backseat and
no longer is.
Yeah.
So even if you are not selling your business, but
you're building your business, you also need to be thinking
about what am I building outside of the business.
Exactly.
You don't want to wake up 10 years into the
business and say there's no value.
There's no, maybe there's there's value for the
business, but there's no personal value for you as the
founder.
What are you going to do with the business?
What if you don't want to run it anymore and
you're not going to be able to sell it?
And when I talked to founders, a lot of our
founders in Luminary community, a lot of them are in
that place.
I'm just kind of done with running my business.
What are my options?
And so I think the more we talk about this
out loud, the better.
That's how all three of these acquisitions happened.
It wasn't because I proactively approached someone.
It was because a, somebody I know in my network
approached me and said, hey, I'd love to introduce you
or I think there's an opportunity.
Would you like to be connected?
And I think as a founder, having a financial advisor
there to run models for you about different outcomes is
extremely helpful, right?
This scenario, I clear this.
In this scenario, I clear this.
But I have a paycheck for X number of years
and I've got rolled equity and...
Exactly.
So what do each of those look like relative to
vision that you have for the life that you want
to live and you want your children to live and
the legacy that you want to leave?
Absolutely, absolutely.
And maybe you want to sell and go
on and build your next company.
That is not me.
But, I don't want to build another company.
I know that of myself, but I don't whenever this
journey ends, whatever that looks like, I won't be sitting
on my hands.
I'll be doing something different.
It's just I know that this is probably, I'm not
a serial entrepreneur and I'm OK with admitting that
because a lot of my founder friends are, they love
it.
They love the build and I like the operating
the business.
That's where my skills I think are the most utilized
is operating the business.
You introduced this idea of what you'll do
next, and I call it the what's next
leg of the stool.
Most entrepreneurs that I meet are not done, and that
doesn't mean that they have to become a rinse and
repeat entrepreneur.
In my experience, those who are the most engaged with
what they're doing end up meeting other founders and having
opportunities to invest in other companies with the capital that
they've cleared on the exit.
Or they've become some... a really powerful philanthropist and can
lean into the causes that they care the most about.
But let's go back to the cause of today, which
is Luminary, right?
I often say that when women gather, magical things happen.
And when you gather women entrepreneurs around a table at
Luminary, what are they talking about?
Most people will say, oh, is it always
just about access to capital?
That's definitely a conversation, although I think the conversation is
changing.
I think because of the market and because of
just what's happened over the last couple of years.
I feel like there are a lot of founders,
in particular women and women of color that are saying
I don't want to
dilute myself to the point where I don't have the
business because even if I sell, what am I going
to make on that?
I think they've had some stumbling in a
fundraising cycle and say I don't want to go through
that again.
Can I do this on my own?
Or they're looking at different, new different kinds of funding.
And I spent a lot of time just in
my groups educating people on how they can use different
types of funding.
I spoke at an event last week on Angel investing.
And I'm an Angel investor in a number of companies.
So there's lots of ways.
I think that the thing that's coming up a
lot right now is the middle.
The messy middle?
Yeah, the messy middle of being in the journey.
So a lot of younger, not younger meaning age wise,
younger entrepreneurs, meaning the age of their business.
They're still focused on that like really early stage building
out their social media, you know, product market fit.
And then we hear, and we hear a lot from
them.
And then we hear from a lot of those that
have already exited or they're well into their journey.
There are so many founders that are in the middle
of it.
They're like, but I don't know how to get from
here to that exit or from here to I want
to acquire something and they're looking for guidance.
And where they find that, I think in particular Luminary,
is from their peers, right?
It's from this storytelling, listening to others.
And this is why it's so important for for podcasts
like this to exist and for the stories that we're
telling, people learn from them.
When I was diagnosed, just very quickly, with breast cancer
a couple of years ago and after they got the
cancer out and my breast surgeon, I said I would
love to have you come and talk at Luminary.
Just about one in eight women get diagnosed, etcetera, etcetera.
She said
people don't listen to doctors, they listen to their friends,
they listen to you.
So you have to use your platform and you talk
about it.
And I realized in that moment that she was right.
They, people listen to each other.
They want to hear a story that they can connect
with.
Then they want to ask questions.
So when I look around this table and not just
entrepreneurs because Luminary is a very big mix of
professionals, they want to hear from each other.
The other thing I think that they're looking for is
therapy.
It's hard.
I'm, given the environment we're in right now and
with tariffs and again, the economy and...
Difficulty raising capital.
All of it.
I think people feel a little bit like whiplash
from 2020, like, wait a second, we're going through another...
and you just got to remember like this is a
cycle.
We go through these every couple of years and I
remember when I built my original business plan, I built
in a recession just in case.
I didn't know a global pandemic was going to happen.
But so you have to also be ready to adapt
to that, that uncertainty.
And it's not easy.
So surround yourself not only with great people, but surround
yourself also with those four people I talked about
earlier, your banker or your accountant, your lawyer and your
financial advisor because they are an extension of you and
they are going to be somebody to tap into for
great advice.
I love that the members of Luminary want to learn
from one another and having a seat at that table.
I'm wondering what they're not talking about that might concern
you or that might be helpful to them in your
opinion.
The numbers.
OK, that's yeah.
You know, I think most, I'm generalizing, but because
I teach this every month at Luminary through a business
plan boot camp when I will do a show of
hands and there could be, my last one
we had over 600 people on it, all genders.
I said how many of you have written a business
plan or a deck?
98% No.
What?
No.
Yeah.
Well, I'll get a lot of like sort of I
have some things I have to refresh and then probably
worse, it's like 99% don't have when I asked do you
have financials or financial projections sort of, but most no.
And so I think I use the analogy, in January,
the bill that you do not want to open is
your credit card bill because it's right after the holidays
and you know, you likely overspend, right?
So you don't want you kind of put it to
the side.
I think a lot of business owners don't want to
look at their numbers every month because it tells a
story and it might not be the story they want
to be told.
So and then you fall back on the things
that you're good at.
Most people say, well, Cate, well, you were a banker,
so this just comes naturally to you.
No, I'm not, I don't,
I'm not running a corporate banking business anymore.
Did I learn how to build strategic plans and operate
a business?
Absolutely.
But I also had millions of dollars at my disposal
on people that helped me build that business.
It wasn't on the back of my, you know, on
mine.
So I think a lot of founders don't want to
take a hard look at their numbers.
What kind of advice do you give them to get
started?
So the first thing I tell people is you don't
need to come from finance to do this.
The first thing to look at is your expenses.
So whether you're already in business and lots of
the people that we work with are or
you're starting out as do you, do you have a
good handle on your expenses?
Forget revenue for a second, because that's great.
You have revenue, but if your expenses far exceed your
revenue, doesn't work.
I would say 75% if not more
don't... they think there's a number in their head and
then they go back and I make them write it
down like every single expense they can think of on
a monthly basis.
And then we go through the exercise, OK, now add
20% for the things that you don't know that
are coming.
And by the way, if that doesn't happen, great.
You get an extra, get a little bonus for yourself,
and then you amortize them over the year.
And you can see it, especially when I'm teaching it
live, the light bulbs going off. Wow.
Or oh, I'm underspending and this is where
I can spend more or I can hire somebody.
If you don't have a good, if you do not
have a good handle on your numbers, you will not
succeed.
And that's personal, too.
So everything you're saying is ringing so many bells from
me because as you know, I work exclusively with women.
Now, sometimes women are married to men or they have
sons or male business partners.
So it's not at the exclusion of the men.
It's to help women have agency with their capital.
And many women, I'm not saying all, many women say
it's not my bag or he has to do something.
I can't completely emasculate him.
They, they're giving up their power when they hand
their financials to their partner or their spouse.
So I hear, I hear that it's not my thing.
I'm not good at it.
But when I do end up in a discovery conversation
with somebody to understand what they're spending, 95% of people
have no idea.
Yeah.
And when they think they do, they're off by a
large sum.
Right.
So I love that you're putting the 20% down that
you don't know, it all aligns very closely
with your personal financial management.
And both of those things need to be watched.
Those are the first two legs of the stool.
For anybody out there that has bootstrapped
stiletto strapped, you know, the way you manage your
money from before you started to when you start your
business, especially if you're, you know, putting your own capital
in it.
It's a, it can be a shock
to the system, But if you don't, and my
team knows how focused I am on expense management.
And those are the levers that are the easiest things
to pull when your cash flow dips or you have
something like a global pandemic hit your business.
That's the first thing that we did.
As soon as it was even making the airwaves,
my then-COO and I looked at all of
our expenses, our vendors.
We started calling our vendors saying, do you have, just
in case this happens,
do you have a payment plan?
My landlord was the first call I made.
And I will say all but 1 of 19 vendors at the
time worked with us.
But if you don't have a good handle on your
expenses, then that's why I think a lot of people
didn't make it.
Obviously it was a terrible time.
I think also when you take other people's money, it
becomes much easier to spend than when you are looking
at your own money every day and saying how am
I using this dollar versus that dollar versus well, I've
got somebody else's and I'm going to go hire a
bunch of people.
And that's what we've seen a lot of people over
hire because it's not necessarily their money, but you gotta,
there's goods and bads to taking any kind
of money and you just have to know what you're
walking into.
I'm having so much fun in this conversation, but I
think let's bring it back to in your experience, having
started this business, having scaled this business, having, looking to
an exit, having gone through an offer, having decided that
that offer isn't, you're not ready for that.
Having really focused in on your personal wealth,
what would you say are the top three things you
would advise female entrepreneurs to think about and take action on?
Yeah.
So I think I'll go back to the
acquisition piece.
When I started Luminary 6 1/2 years ago, did I
ever, was that like in my strategy?
No, but so you've got to be open to ideas,
you've got to be open to meeting.
So regardless of you think you're too small or maybe
that doesn't, maybe it isn't the right fit, take the
meeting, just take the meeting and then you make the
informed decision.
But the top three things that I would say that
anybody, again, going back to knowing your numbers, they
are the key to your success.
They will be the key to your success.
What's your plan not just about pivoting, but how are
you adapting?
How are you looking at the landscape?
How are you listening to your customer, building relationships, like
we've said with your critical partners, including those four
that we mentioned?
And then you know, I always say that this
sort of bonus is your ROI on your own time.
Why do I say this?
The more public you become in building a
business, small, medium, large and the goods and the bads,
the more people reach out to you and they want
your time.
So be very deliberate about your time and ask thoughtful
questions before you even give up your time.
I now have an office hours once a month because
I was getting inundated with women in particular on LinkedIn
saying I'd love to have a coffee chat.
Pick your brain.
Can I, the worst phrase in the world, pick your
brain.
And so I created an office hours.
And so then anybody can kind of join and they
get a little bit of my time and it's 90
minutes a month.
And then I have specific people if they come through
a warm introduction, I will never turn down because there's
a reason behind that.
And then protect your time at all costs.
Well Cate,
thank you so much for your time today.
I'm so grateful for your insights and if folks want
to learn more about you or Luminary, where can they
go?
Luminary, you can just go to weareluminary.com, that's our website.
We are Luminary on Instagram and just search for Luminary
on LinkedIn.
And for me, you can find me on LinkedIn.
That is my preferred platform, always Cate with a C Luzio,
and if you do follow me on Instagram,
you're going to see lots of cats, my nieces and
nephews, my outfits of the day.
If you're going there for business advice, I would suggest
you go to LinkedIn.
And don't ask to pick her brain.
And do not ever ask to pick anyone's brain.
Thank you again, Cate.
And if you are a female founder and you need
some help thinking through what your number is, please feel
free to reach out to me at jill.lloyd@ubs.com or on
LinkedIn.
Jill Faherty Lloyd. Thanks again for joining and onward.
This podcast is presented for informational purposes only and should
not be relied upon as investment advice or the basis
for making any investment decisions.
It does not constitute an offer to sell or a
solicitation of an offer to buy any specific product or
service.
UBS does not provide legal or tax advice and we
would recommend listeners to obtain appropriate independent professional advice.
Some of the views and opinions expressed may not be
those of UBS Group AG or its affiliates.
UBS Financial Services, Inc offers investment advisory services in its
capacity as an SEC registered investment advisor and brokerage services
in its capacity as an SEC registered brokerage services in
its capacity as an SEC registered broker dealer.
These services are separate and distinct, different material ways, and
are governed by different laws and separate arrangements.
It is important that you understand the ways in which
we conduct business and that you carefully read the agreements
and disclosures that we provide about the products or services
we offer.
For more information, please review the client relationship summary provided ubs.com/relationshipsummary.
UBS Financial Services Inc is a subsidiary of UBS Group
AG and is a member of FINRA and SIPC.