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You never know what is going to happen when big ideas and big money collide.

As we learn in this episode, pitch meetings can be pretty unpredictable. A simple word or phrase can change everything on a dime — sometimes for the best and sometimes for the worst. Our contestants also get a lesson in long-term success from investor Marc Randolph, who has this to say: "Customers shouldn't come and go, they should come and stay. So look for ways to turn your customer base into a community with social media, in-person events or inviting customers to join an advisory board. You will not only gain valuable insights, but you will turn your customers into your no. 1 fans."

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News
Transcript
00:00 Welcome to the elevator.
00:03 Today, three VIP titans of the industry decide the fate of rising entrepreneurs.
00:10 I'm ready to make money, so let's get this thing going.
00:12 You're in, you're out, I don't even know what just happened there.
00:15 I surprise myself sometimes.
00:17 Going up.
00:19 Oh my God!
00:21 I know there's a pony in there somewhere.
00:23 Determined to prove their greatness in 60 seconds or less.
00:27 I'm in, I'm going to outbid all of them.
00:29 You're out of time, young man.
00:31 This is Entrepreneur Elevator Pitch.
00:35 Presented by Amazon Business with support from State Farm.
00:44 Meet our board of investors.
00:46 Kim Perel, serial entrepreneur and tech CEO of 100.co.
00:52 Mark Randall, co-founder and first CEO of Netflix.
00:57 Logan Stout, keynote speaker and best-selling author of Grit Factor.
01:10 Hoping to make dieting easy is our first entrepreneur with her healthy food ordering app.
01:27 Going up.
01:30 Hello, Lucy.
01:33 Welcome to the elevator.
01:35 Your pitch begins in 3, 2, 1.
01:42 Hi, my name is Lucy Allaire and I'm CEO and founder of Guiltless to Go.
01:46 And we're building a revolutionary AI-powered app that's making healthy on-demand ordering easy.
01:51 With my background in weight loss, health and fitness, I know firsthand challenges people face when it comes to ordering healthy.
01:58 They have no idea how many calories they're consuming.
02:00 They're confused about diet type rules.
02:02 And they don't have time to meal prep, cook or shop.
02:05 But with our app, we'll take the guesswork out of it, allowing users to easily filter, search and order from nearby grocery stores and restaurants by diet types, ingredients, allergies, calories and prices.
02:17 We'll use large language models and apply our own patentable AI technology to current partner infrastructures, giving us access to over 1 million grocery stores and retailers nationwide, giving us the ability to scale fast.
02:29 We're still pre-revenue, about to alpha launch our alpha version, asking for $500,000 for 7%.
02:37 So hit that button to learn more how users can order smarter, eat healthier and guilt less.
02:41 Guys, I actually thought that was a pretty good pitch.
02:45 She was very clear in what her offering was, what she wanted and she left me actually wanting to learn more.
02:51 Well, I was left wondering more too. Like, for example, I was wondering how is this differentiated from every single other food ordering service out there?
02:59 You all know my background. I'm excited about this. What I'm not excited about is where I think they are.
03:06 You guys want to vote?
03:07 Let's do it.
03:08 Let's do it.
03:16 Attention, Lucy. Your pitch has been approved.
03:25 Yes!
03:26 Hi.
03:27 Welcome to the boardroom, Lucy. We are thrilled to have you here.
03:31 You did a great pitch and we unanimously voted you up.
03:35 But we still have a few questions that we want to ask you.
03:37 Thank you for voting me in.
03:39 What differentiates you from all the competition out there?
03:42 Our main competition out there really is focused on serving the masses.
03:46 I mean, they might have a healthy section and do that a little bit, but their main objective is serving everybody.
03:53 And we are going to be the first on-demand platform that is focused on health conscious and doing it better than anybody else.
03:59 So, Lucy, I don't know if you see this expression, but it's not one you want to see during a pitch.
04:04 In other words, I'm confused.
04:06 What does it do? Is it literally just go on the app, pick the food and it gets delivered to you?
04:11 Yeah, so it's kind of got like the filtering functions of a Yelp meets a DoorDash or an Instacart made for health conscious users.
04:19 But anyway, users would basically download the app for free, put in their zip codes.
04:23 They'd be able to, it's a two-sided app.
04:25 There's a restaurant side and a grocery side.
04:28 And they'd go into their easy health conscious filters, pick their diet type, keto, low carb, paleo, vegan, vegetarian.
04:36 I own a personalized health and wellness company.
04:38 We're the world's only genetic-based personalized health and wellness platform.
04:40 I'm confused on how you're different than Uber.
04:42 So if Uber Eats wanted to come out right now and do this, right, what would stop them from doing that?
04:47 So one thing we're doing is we're applying PadMobile AI technology to give an estimated calorie count to every menu item.
04:53 So Uber Eats and those companies, they only give the calorie count for the items, for the restaurants that show the calorie counts.
05:00 We're going to give an estimated calorie count to every menu item based on the ingredients and assumptions to be made and how it's cooked.
05:06 And also the AI is creating specifications, modifications to menu items done for the user.
05:12 So this would be a perfect marriage with ID.Life, my company.
05:15 Flawless.
05:16 I thought it was, I go onto this app, boom, I know what my macros need to be.
05:20 I click in this stuff and boom, all these options pop up near me, utilizing AI, that I can go.
05:25 But then you're telling me there's drivers.
05:27 Are they delivering it to us or what is it?
05:29 I'm confused.
05:30 Yeah, so on the app, we'll have it filtered like that.
05:33 You, at the end, you'll decide if you want the quickest or fastest delivery.
05:37 And based on that, it'll give you your driver partner, delivery partner.
05:41 I have a simple question here, and this could be just a fundamental understanding of how this market works.
05:47 Do you have to go out and sign up these restaurants and these stores yourself?
05:50 Is there an API that gets plugged into?
05:52 Yeah, we're applying to an API partner.
05:54 We have an executed partnership giving us access to over one million restaurants and grocery stores nationwide.
05:59 So we have the supply side established.
06:01 And the patent pending technology differentiator is the predictor of missing nutritional analysis that's not available otherwise?
06:12 Yeah, it's one of those is basically how we're going to apply an estimated calorie count to every menu item on the platform.
06:19 And the classic model is you take a percentage of the order?
06:23 We're only doing, in the beginning, transaction fees.
06:27 So we're only going to be, you know, we're going to price test, but like two to five dollars more than the traditional.
06:32 I know there's a large market of people who want to eat healthy.
06:35 Are they interested enough to use a specific proprietary app to order from?
06:40 And will you still share away from the other online ordering apps that people are right now accustomed to using?
06:48 I think that's the big bet here.
06:50 I mean, I actually think I would use something like this.
06:53 It's so easy, and I use the apps all the time.
06:56 But my concern is the big guys are just going to come in and knock it off.
07:01 I look at us being a tool to every weight loss, health and fitness coach, doctor out there, like a niche.
07:11 I actually really like what you're doing, but I think the strategy, in my opinion, should be what's the partnership strategy with some of those fitness and wellness companies?
07:19 Because that's where the money's at, not from the advertising.
07:22 It's their ability to use your technology.
07:25 For me, it's a little too early. I need more clarity.
07:28 For that reason, I'm going to have to pass for now.
07:32 In a few minutes, you might come back in.
07:34 I'm waiting for you to put your money out and then maybe I'll bid you.
07:37 No, Logan has a good point, which is you're almost too soon, but not by much.
07:44 What I really am curious about is how much do people really say this is something I have dreamed of and I have to have?
07:52 And it's really hard for me to make a judgment of whether that's there or not.
07:56 I'm going to pass.
07:58 I do love what you're creating.
08:01 I think that your business has yet to find itself.
08:05 And for that reason, I unfortunately am going to pass.
08:07 We appreciate your time. Thank you so much.
08:11 And looking forward to seeing you continue to grow.
08:13 Thank you.
08:14 Good luck.
08:15 Good luck.
08:20 Lucy, wait a second.
08:22 I have an idea.
08:23 Everything I said before is true.
08:26 For a $500,000 investment, for 7% of the company, you're too early.
08:31 But I think you're close to being able to prove your premise or not.
08:36 So I'd be happy to write a check for $25,000 at the existing valuation.
08:41 Absolutely.
08:47 Let's do it.
08:48 Wow.
08:49 Wow, out of nowhere.
08:50 Another deal.
08:52 I'll be your first customer now.
08:54 Thank you, Lucy.
08:55 We're going to do business if you figure this out.
08:57 Let's do it.
08:58 Congratulations.
09:00 I feel so excited that I just landed this deal with Mark.
09:06 One minute I thought I wasn't going to have something.
09:09 Next minute he calls me back in and I know it's not what I came for.
09:12 But a check is a check and I'm super excited to be working with him.
09:16 I'm super excited to be working with him.
09:17 Customers shouldn't come and go.
09:22 They should come and stay.
09:24 So look for ways to turn your customer base into a community.
09:27 Whether that's with social media, in-person events,
09:31 or even inviting customers to join an advisory board for your business.
09:35 Either way, you'll not only gain valuable consumer insights,
09:39 but you'll turn your customers into your number one fans.
09:44 Entrepreneur Elevator Pitch is presented by Amazon Business.
09:49 For every organization at every stage of growth.
09:52 Next in the elevator, two entrepreneurs who plan to propel the food industry
10:02 with their energizing gut-friendly snacks.
10:05 So I, like many women, have had an unhealthy relationship to food.
10:10 And in the process of creating a lobby and bringing more products out to the market,
10:16 I've been able to heal my relationship with food and not fear food
10:20 and view it as fuel and something to look forward to and love food again.
10:25 And that's what we're really excited about here at a lobby is to elevate our consumers
10:29 to feel their best so they can live their best.
10:31 [Music]
10:42 Going up.
10:43 Hello, Michelle and Nikki.
10:48 Welcome to the elevator.
10:51 Your pitch begins in 3, 2, 1.
10:58 Hi, I'm Michelle and I'm Nikki and we're the founders of a lobby.
11:02 A lobby was born out of our personal struggles as both fitness trainers
11:06 and corporate professionals who needed low sugar, gut-friendly snacks
11:10 that could satisfy our sweet tooth and keep us full for hours and all without the nasty additives.
11:15 So we created a line of dessert cashew butters unlike anything you've seen before.
11:20 They're naturally colored by superfoods, gut-friendly and 10 times less sugar than the natural competitor.
11:26 We're also expanding our product line into adding on an innovative high-protein dessert in Q1.
11:33 We're primarily sold online and on Amazon.
11:35 Perform strong in the fitness and office channels including Lifetime Fitness and EconOps
11:39 and just secured our first purchase order with Costco.
11:42 We've done $1 million in lifetime revenue with a lean team and a focus on capital efficiency.
11:47 We brought on top CPG advisors, built a fast-growing online community
11:50 and have gone viral on TikTok multiple times.
11:52 We're raising $250K on a saved donate.
11:54 We'd love to have you join us to spread our mission to make healthy snacking fun and functional.
11:58 Whoa! Under the wire at the last second.
12:03 I loved it! They nailed that pitch.
12:05 Too bad they have no energy.
12:07 What's most exciting for me about this is it's digital first.
12:11 I mean they've done a million dollars, TikTok, social.
12:14 They're crushing it. Good for Amazon.
12:16 I love to see that because retail's hard.
12:18 So being able to really land digital first and build up a great consumer base, good for them.
12:23 Well, we've heard the pitch and the question is have we heard enough to decide whether we want to bring them in?
12:28 Let's vote.
12:29 Let's vote.
12:30 Hello, Michelle and Nikki.
12:42 Your pitch has been approved.
12:46 [Screams]
12:48 [Screams]
12:52 Yes!
12:53 Nikki, Michelle, congratulations.
12:56 Welcome to the boardroom.
12:58 We're so excited to be here. Thank you so much for bringing us on.
13:00 I think it was Biggie Smalls who said never get high on your own supply.
13:05 And one of the things I love about that pitch was hearing it's a digital first company.
13:10 So that means I get to geek out.
13:13 So tell me, CAC, lifetime value, average order size.
13:17 First, would you like to try the product while we're sharing the numbers?
13:21 No, no, no. I want to try the data first.
13:23 Okay.
13:24 That's tastier.
13:25 I do want to try the product while he wants to sit over here and talk about RAP and whatever he's doing.
13:29 One thing at a time, young man.
13:32 You got it. Cost to acquire a customer, $30.
13:34 Extremely low right now on the market.
13:36 Lifetime value, $120.
13:37 What was your other question?
13:38 Average order size.
13:39 Average order size, $50.
13:40 Cost margin?
13:41 50%.
13:42 Yeah.
13:43 Okay.
13:44 We sell online both D2C and on marketplaces, including Amazon.
13:48 And that's been doing extremely well for our channel because we strategically formulated products that are shelf stable so we can ship them very easily.
13:55 We aren't extremely reliant on retail as if we were a frozen or a beverage product.
14:00 So million in sales.
14:02 When did you guys start the company?
14:03 So how long of a period is that over?
14:05 Yeah, yeah.
14:06 So initially we launched January 2020 under a different product name, product company.
14:11 That first year we did 75K.
14:13 It was all online.
14:14 And that was more of our beta incubation year.
14:16 Then in 2021, we did $150,000 in sales.
14:20 Doubled our growth.
14:21 Doubled our growth.
14:22 And then in 2022, when the world started opening up.
14:25 We, after finishing formulation in 2021 of our, these cashew butters here that you see here, we launched those January of 2022.
14:31 Would you like to try the product?
14:32 Please may we try the products.
14:34 I mean, I'm drooling over it.
14:37 It's so rare to find healthy snacks.
14:40 Snack usually means it's bad for you.
14:42 It's like, okay, I'll just have a few snacks.
14:44 I'm excited about this.
14:45 Until we feed Logan, we're not going to get a word in edgewise here.
14:48 Exactly.
14:49 Thank you.
14:50 Thank you so much.
14:52 So we have chocolate fudge, blue vanilla frosting, which is naturally blue from blue spirulina.
14:57 And we're sampling them with banana.
14:59 Is one of you the CEO?
15:01 I'm the CEO.
15:02 Okay.
15:03 Yes.
15:04 And Nikki is the COO and CFO.
15:05 And you all are 50/50 partners?
15:06 70/30 because I started the company originally and then brought on Nikki very quickly on.
15:14 But it started with my personal story, having eating disorder in my early twenties.
15:20 I struggled with having a healthy relationship to food.
15:24 Most of it was driven by being afraid of food because I had a lot of food intolerances.
15:28 Gluten, dairy, soy, sugar, alcohol is everything that it's in a lot of our packaged foods.
15:33 It's delicious.
15:34 Just so you know.
15:35 All organically, naturally derived?
15:37 So they're all ingredients that you can pronounce.
15:39 Everything is non-GMO, mostly organic.
15:41 We use creamy cashew butter.
15:43 That's the creaminess that you're tasting and the natural sweetness as well too.
15:47 We have superfoods that give them their color and we naturally sweeten them with monk fruit and dates.
15:52 So they're low glycemic, but they won't upset your stomach like sugar alcohols do.
15:55 Okay.
15:56 So you asked for, if I recall, $250,000 at stake.
15:59 What valuation?
16:01 Six million.
16:02 Free money.
16:03 You're raising a million.
16:04 You've already raised $500,000.
16:06 You have enough cash through the end of the year.
16:08 But you need the other $500,000 to get through 16 months.
16:12 Correct.
16:13 I like the flavor.
16:14 I'm interested.
16:16 But I feel like there's some tweaks to your business that we can talk about, perhaps.
16:20 I'm willing to offer $100,000 at a $5 million valuation.
16:28 Okay.
16:29 Thank you for that offer.
16:30 Thank you for the offer.
16:31 I'm a big investor in a lot of CBG companies, and I love what you guys are doing.
16:34 And I love seeing the passion.
16:36 And honestly, I would love to invest $100,000 at the current valuation.
16:40 Thank you.
16:41 Thank you.
16:42 I like what you're doing, but I don't think I can do better than where you sit with Kim.
16:48 What's that supposed to mean?
16:49 Well, you're low balling them.
16:51 Yeah.
16:52 I'm going to bring more revenue to them in 24 hours than you can even imagine.
16:57 Ladies, I totally understand where you're at.
17:02 I'm an entrepreneur at heart.
17:03 I have 20 years in digital advertising.
17:05 I understand D2C.
17:07 I understand retail because I'm working in companies right now.
17:11 Logan obviously has some expertise.
17:13 I've got 65,000 people that rep ID.Life products, clean, organic, and naturally derived products around the country that we can drop.
17:24 Guys, I've heard a lot of dreams a lot of times.
17:27 Someone tells me, like, a rose bush and I get a rose.
17:29 I've heard it all the time.
17:30 You have $100,000 at a $5 million pre-valuation on the note.
17:36 And Kim, you have also $100,000, however, matching your $6 million current valuation.
17:43 What do you think?
17:45 Can we have a minute just to discuss?
17:48 [Music]
17:56 Kim, love to do a deal with you.
17:58 I love a woman on business.
18:01 Love it.
18:02 Thank you so much.
18:05 Lots of snacks coming for you.
18:07 Thank you.
18:08 Congratulations, ladies.
18:09 Congratulations, ladies.
18:10 Good luck.
18:11 Thank you.
18:12 I don't want to hear it.
18:14 We feel so excited.
18:16 We are fangirling so hard.
18:17 We came in really hoping to get a deal with Kim, so this was such a joy to get to work with her.
18:22 Yeah, it's really hard to get women investors onto our cap table.
18:25 And especially as women entrepreneurs, it's also hard for us to get funding.
18:29 So it felt so incredible to get Kim on board as our investor.
18:32 She believed in us and we were so excited to have her.
18:35 So it was just a mutual excitement.
18:38 [Music]
18:43 Our final entrepreneur is fortifying software to enhance cybersecurity at an accelerated rate.
18:50 [Music]
19:01 Going up.
19:04 Hello, Ian.
19:07 Welcome to the elevator.
19:10 Your pitch begins in 3, 2, 1.
19:17 Hi, my name is Ian Eiberg.
19:19 I am the CEO of NanoVMs.
19:21 NanoVMs runs Linux software faster and safer than Linux.
19:24 Linux is, of course, the most widely deployed server operating system in the world.
19:29 Every single tech company is heavily built on it, as are most of the world's major corporations.
19:34 Unfortunately, Linux is about 30 -- well, it's north of 30 years old.
19:38 It has severe security issues that haven't been resolved.
19:41 And it was built in a time period before virtualization and before all the public clouds.
19:45 So we fix all this.
19:47 We have four patents issued.
19:48 We have four more filed.
19:49 We have grants from the United States Air Force, the Department of Energy, the National Science Foundation, and DARPA.
19:58 Investors today include Initialized Capital, L2 Ventures, which is Joe Montana's fund, Bloomberg Beta, HackVC with Ed Roman,
20:06 Rongulo with Gula Tech.
20:08 We have about a 500K allocation open right now at a $25 million cap.
20:13 Let's chat.
20:15 That was interesting.
20:18 I would agree.
20:19 Interesting is a good word for that pitch.
20:21 You know, I've never believed in knocking someone's knees out to lift yourself up.
20:26 And it's like you spend so much time bashing Linux.
20:29 Yeah, but I disagree with you.
20:30 I think you have to establish what the problem is.
20:32 And a lot of people use Linux.
20:34 It's very, very widespread.
20:36 And he's saying, really, he's got a better way.
20:38 So that's fairly compelling right there.
20:40 And actually does get me in a nerdy sort of way to perk up a little bit.
20:44 He's raised a lot of capital before.
20:46 And he cited some of the notable investors, which is impressive.
20:49 But the question I ask is, how much has he raised?
20:52 I'm not sure I understand what he's doing.
20:54 And I don't just mean he didn't explain it in 60 seconds.
20:57 I think if he spent 60 minutes, I still may not understand what he's doing.
21:01 That's concerning, Mark.
21:02 Are we ready to take this to a vote?
21:03 I'm ready.
21:04 I'll go.
21:05 Let's do it.
21:06 [MUSIC PLAYING]
21:08 Attention, Ian.
21:16 Your pitch has been approved.
21:21 Welcome, Ian.
21:28 Hey, guys.
21:29 Hey, everybody.
21:30 How are you doing?
21:31 Doing great.
21:31 Yourself?
21:32 Doing well.
21:33 Well, congratulations.
21:34 Welcome.
21:35 I should note that two of us voted you in.
21:38 One did not.
21:39 So we'll have a little bit of convincing to do.
21:41 And so you're asking for $500,000 at a $25 million valuation.
21:45 Before we get into numbers, can you please help us better articulate what it is you're actually offering into the marketplace?
21:51 So our software basically provides much more security, much more performance.
21:57 So we can run 200% faster on Google, 300% faster on Amazon, for instance.
22:02 And how can you do that, but the mothership can't?
22:05 It's actually one of the problems.
22:06 There is no single one company behind the whole mothership.
22:09 OK.
22:10 There is no Microsoft.
22:11 There is no Google behind it.
22:12 This particular operating system, like many, were written for actual real computers.
22:16 So like a 286, a 386 back in '93.
22:19 That's very different from the future that we live in today, where you're an engineer at Uber or Airbnb or a company like that.
22:26 You don't have one database.
22:28 You don't have one web server.
22:29 You have thousands of them.
22:30 And they each have thousands of engineers themselves handling these essentially fake computers.
22:37 What's the barrier?
22:38 Why is it so much more powerful and so much better?
22:42 Why isn't it being more rapidly adopted?
22:44 That was my deal.
22:45 If Linux is so bad, we want to spend all this time bashing them.
22:48 I mean they've got to know they're bad.
22:50 And they've got all this money and manpower.
22:52 They don't have a lot of money because they're not a company.
22:55 It's an open source project.
22:57 There are companies like Google and IBM and so forth that pay into it.
23:01 But there is no PM for it.
23:03 You're definitely on to something.
23:04 Obviously, your pitch I thought was very good.
23:07 I thought it's interesting to see the great support you have from the investors already.
23:11 What lost me, to be honest, because I was the one that did not vote for you to come up, was only because in the end, to be honest, you were kind of lackadaisical about like if you want to maybe invest, I might want you to and then maybe we'll chat.
23:24 It was so kind of rude and off-putting.
23:26 What's the better model here? Like Red Hat or something like that?
23:30 Every single vendor out there is selling a solution that's to prevent computers from getting hacked or scanning for systems that are already hacked.
23:39 And they're not really focused on the actual problem.
23:42 The actual problem is the operating system is inherently built for hackers to break into it.
23:46 You're convincing people to basically say stop patching, start from scratch with a more modern solution.
23:52 What I want you to do for me, this is the piece I'm missing, is to project at some point in the future when money is pouring in and tell me how that happens.
24:02 So today, our actual financial customers who are different from our end users, they could be VPs of engineering, director of infrastructures, titles of that nature.
24:11 And, you know, especially with, say, our package repository, those are licensed on a per seat.
24:17 So right now it's at a $7 per seat, but when you go into a company who has 300 engineers or 2,000 engineers,
24:24 you know, that starts adding up to a couple thousand dollars minimum per month that you get at that one company.
24:31 Ian, honestly, I was skeptical on your pitch. You were still let into the boardroom and I'm still confused.
24:39 So at this point, I pass.
24:44 Gentlemen, have you heard enough to make an offer?
24:47 I've given up. So, no, but I'm not going to keep digging at it.
24:53 This is potentially really, really interesting, but I cannot get my hands around why or what.
25:00 And I would need that to come in on a $25 million valuation. I pass.
25:06 We keep prodding for clarity around this and I'm struggling to get it from you.
25:12 And I don't know this space like my friends do well enough to keep moving on in this conversation.
25:19 If I had enough ammunition, I was going to go get them and say, I invested in something.
25:24 Let's go do this together. And they would do it. But you're not a failure until you quit. Right.
25:29 But you're going to fail to win. That's just how life works.
25:32 There is no deal today. We appreciate your time.
25:36 Thank you for your time. Good luck, Ian.
25:39 I think the investors missed out on an opportunity. Yes.
25:44 You know, you talk to a lot of investors and usually they are looking for a reason to say no because they talk to people like me 20 times a day.
25:52 And they have to say no for some reason to some people.
25:55 Sometimes I have a whole Excel sheet filled with no's. So I'm kind of used to it.
26:00 So it's quite OK.
26:06 While three entrepreneurs were able to secure a high flying deal.
26:11 One was sent back down with nothing to show.
26:17 Whether it's a new innovation or a new way of living life.
26:22 Anyone could be 60 seconds away from rising to greatness or fall from glory.
26:29 Tune in next week as entrepreneur elevator pitch continues.
26:35 I've been practicing something.
26:37 My wallet quick draw.
26:40 Oh, I give up.
26:41 And to apply for the next season, go to entrepreneur.com/elevator pitch.
26:47 Investors personally styled by celebrity stylist Kim Bollefe.
26:52 [Music]
26:56 (whooshing)

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