How do you pay for your passion? Race car driver Aurora Straus became a financial grownup early on when as a young teen she wanted to get into the very expensive business of race car driving. Straus gets candid about how she leveraged LinkedIn and brownies to get the sponsorship money to make her dream come true.
Aurora's money story:
Aurora Straus:
Yeah. I mean, the unspoken elephant in the room in the racing world is that racing, particularly getting your feet on solid ground, requires a lot of track time. And a lot of track time requires exorbitant amounts of money. That is one of the largest reasons that racing is very much a family sport is because it's passed down from generation to generation because otherwise it's virtually impossible to, or very hard, I should say, to raise the funding to get involved.
I was blissfully unaware of this which I think was a very good thing when I started racing. When I was 13 my dad didn't want me to race cars, but he wanted me to become a safer driver so he put me in a stick shift Mazda Miata with him-
Bobbi Rebell:
Wait. Just to interrupt here though. The driving age in both states is 16, and you're from Cold Spring, New York. So how are you driving at 13? Because I know people will want to know that.
“Sometimes going the distance is “oh my gosh I notice that you are working at 10 or 11pm and I’m going to stay with you and I’m going to buy you some dinner.”
Aurora Straus:
Yep. Depending on the insurance policy at some private race tracks, you can start driving at 13. So I started driving at Monticello Motor Club which was about 90 minutes away from New York City. I loved it. Long story short, decided I wanted to do this for the rest of my life, and my dad said, "That's great, but you're going to have to learn a lot of business in very little time.
To his credit he and my parents have both completely changed my life, and not just because of the opportunities they've given me, but because of the business sense that they've taught me.
My first sponsor came to me when I was 16, and I raced in a semiprofessional series for two years. Since then I've raised, oh gosh, hundreds of thousands of dollars in sponsorship money to make my own career happen. And I've just gone through this crazy journey. I started my own LLC. I've had to raise my own money. I've had to track metrics for my sponsors, and I think I grew up very quickly, but I wouldn't take any of it back. Because I've learned more about business from race car driving than I ever will from a summer job.
Bobbi Rebell:
Tell me more about the process. How do you first start out getting sponsors? What is that like?
Aurora Straus:
Yep. Interestingly enough, LinkedIn. I spent a long time trying to navigate through friends of friends of friends, but then I started reaching out to marketing executives at companies that I thought would fit my brand really well. For me the most important thing about a potential new partner, a new sponsor for me, is that I am completely confident that I can deliver, and that it makes sense with my other sponsors and the brand I'm building for myself.
Right now one of my biggest sponsors is Richard Mill, a luxury watch brand, and that for example, doesn't necessarily go well with a mass market workout brand for example. So I'm very much about finding the right fit, making sure that I can deliver to the right companies. I pinpoint one company, and then I'll reach out to probably 100 or 200 people on LinkedIn depending on how big the company is. Generally out of 100 people I'll get maybe five or six to respond to me which is still a pretty good turn around rate all things considered. Then out of these six people responding to me, one person will actually give me their email, and I latch on to that one person for all it's worth. There's a good chance they might not be the right person to write me a sponsorship contract, but they might know the right persons.
So it's all about being scrappy. Race car driving is not as glamorous as people think it is, but I wouldn't give it up for the world.
Bobbi Rebell:
What are the costs associated? Where is the sponsorship money going? Although I hope you also can take some a profit. That's perfectly fantastic, but what are the costs that you have to cover as a race car driver?
Aurora Straus:
The largest cost is just supporting the car. The racing industry revolves around teams who travel from race track to race track all across the country, all across the world depending on what series, and that costs money. Transportation costs money. What my coach said to me, I think three or four years ago, was, "Every time you turn a race car on at a racetrack, you can expect it to cost at least ten thousand dollars," and that's if you're trying to save money. That's if you're on a budget, you're not using new tires, you're not using new gas. And I've found that that's pretty tried and true. That in general, when I'm going to a race track I need to expect to spend at least ten thousand if not significantly more than that.
It's the tiny things that add up over time. A set of tires is a few thousand dollars. We use very specific race fuel that takes a long time to develop that costs a few thousand dollars.
The transportation might be five or six thousand. Race support, because you have a whole crew of guys that are there to support your car. You do hot pit stops so when you're in the middle of a race they've trained for decades how to take a tire off and put a new tire on in a couple of seconds. Those are also highly skilled individuals that need to get paid for a highly skilled job. So it adds up really quickly, and I also believe strongly that I never want to have to cut costs on a team just because your relationship with the team as a race car driver is crucial.
In the same way that you're developing business relationships in, let's say, the venture capital or private equity world, you take people out to dinner, you establish friendships with them. It's the same thing in the racing world. Those guys are going to be the people working on your car at two in the morning to make it a tenth of a second faster, and it's really important that you establish a good relationship.
Aurora’s money lesson:
Aurora Straus:
I'd say there are a bunch of different lessons. The main lesson for me is relationships matter. I've had to develop relationships in a really nuanced way with professionals in the industry including manufacturers at a company like BMW who I'm working with now, or guys on my race team, or team owners, or engineers. Sometimes, and I this is I think true in any industry, going the distance isn't necessarily giving someone a huge bonus or telling them that you care about them or giving them good feedback. Sometimes going the distance is, "Oh my gosh. I notice that you're working at 10:00, 11:00 PM, and I'm going to stay with you, and I'm going to go buy you some dinner or bring you some bake goods."
“Sometimes the best business decision you can make is to turn away deals that don’t value you like you think they should”
The second advice I would give, and I haven't really touched on this yet, but the sponsorship world and the racing world is very male dominated, and I'm also very young. It's taken me a long time to realize that sometimes the best business decision you can make is to turn away deals that don't value you like you think they should. And I've lost some deals because of that where I think these people are trying to take advantage of me. They see that I'm an 18, 19 year old girl, and they think that they could get the sponsorship contract for less. And I've walked away, and it's been hard, but I've also grown, and I've also realized that I get better deals because of that.
Aurora's everyday money tip:
Aurora Straus:
Yeah. My one main tip would be if you have to butter up a potential partner or just make someone happy or in my case, make friends. Come up with one kick ass brownie recipe. I love baking. I stress bake, so during midterms and finals I will almost always randomly show up to my dorm with huge batches of brownies, cookies, what have you. But it also is a lot more personal. I mean, part of my habit of gifting brownies to race teams and to friends came from the fact that I was 16 years old walking into business meetings, and I can't exactly bring wine. That would probably even more inappropriate.
“I started my own LLC. I have had to raise my own money. I’ve had to track metrics from my sponsors.. I’ve learned more about business from race car driving than I ever will from a summer job.”
It also just became a habit that I realized it's more personal than a wine bottle. It shows that you put time and effort into the relationship, and also there's nothing that bonds people more than sitting down at a table together and just talking about how your day was and eating a brownie.
Bobbi Rebell:
What could be better? No one could dispute that. Brownies are always a win.
Financial Grownup Tip Number One:
Sometimes it's a numbers game. It's just a numbers game. You have to put in the effort, let the numbers add up, face the rejection, and keep at it. A lot of the time the rejection is just silence. So many times in my life I have not done as much outreach as I could have because it's so hard. Nobody likes to be rejected especially again, the silence. So I really take Aurora's experience and her results to heart. Reaching out to so many potential sponsors and employees at these companies on LinkedIn, it really was a big project, but she got it done. And because she kept at it and she played that numbers game, she got the results that she needed.
Financial Grownup Tip Number Two:
Aurora talked about her love of brownies and baked goods. That would definitely work on me. I've used the same technique on various projects. For example, when I was writing my book I sent the 30 role model contributors customized baked goods with their picture on them or the company logo, and I also them to their team members that I worked with. Basically, the gatekeepers, the people that control their schedules to make it happen. They're really important so I sent them also thank you baked goods, marked separately, so that they knew that I appreciated the role that they played in making the interview happen. Showing your appreciation is always a great thing to do, and no matter how healthy we all aspire to be, baked goods are always a good call. I hope I don't get any flack for saying that, but come on guys.
Episode Links:
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Aurora’s website - www.AuroraStraus.com
Girls with Drive website - www.GirlsWithDrive.org
Follow Aurora!
Instagram - @aurorastraus
Facebook - @aurorastraus