Thrive Market CEO Nick Green says paying influencers in equity is the secret to avoiding venture capital

Startups are obsessed with venture capital, but Thrive Market CEO Nick Green says you are better off ignoring Sand Hill Road and handing your equity directly to influencers instead. Appearing on an advice-line episode of How I Built This, Green offered a specific, mechanical tactic for consumer brands trying to bootstrap their way to scale. Pay your promoters in stock, not cash.

Green built his organic grocery empire into a retail behemoth by leaning on hundreds of health bloggers to fund the early days. Now, he is telling the next generation of founders to run the exact same playbook. When Danny Walsh, the founder of a mushroom-infused coffee startup, called in to ask how a mission-driven brand should fund its growth, Green and host Guy Raz immediately pushed back on the premise that the company needed funding at all.

I think if you look at really successful businesses, there’s as many that have been ruined by raising outside money as made stronger.

Green argues that capital constraints act as a forcing function for intellectual honesty. When founders raise a million dollars, they almost inevitably spend that million dollars trying to reach new customers through paid digital ads. Those customers might try the product once, but they often churn immediately. The cost of acquiring them eats the cash, the metrics crater, and the business dies.

The equity barter system

Green’s alternative is essentially a barter system for your cap table. Instead of handing a venture capitalist 10 percent of your company for cash, only to give that cash straight to Meta for ads, give the equity directly to the people actually talking to your target audience.

If you imagine, you know, selling 10% of your business by raising money, you could take that, that equity and allocate it to influencers who can get the word out and have an audience and are authentic…

He noted that Thrive Market actively monitored its own customer files to spot organic influencer purchases. When a lifestyle blogger bought groceries, Thrive reached out to formalize an equity-based partnership. It is a highly defensible acquisition channel that avoids the low-quality traffic associated with standard internet advertising.

This is a refreshing dose of reality on a podcast that often glorifies the massive Series A funding round. But it is also a highly situational piece of advice. Paying influencers in equity works brilliantly if you are selling organic groceries or adaptogenic coffee, where lifestyle gurus command fierce loyalty. It is a much harder sell if you are building enterprise logistics software. Still, the underlying logic holds up. Rented audiences from social media ads churn fast, while trusted recommendations stick around.

Green’s anti-scale advice extended to the other callers on the episode. He told a symphony flutist who started a formalwear brand to ruthlessly slash her product variations. He advised the creator of an AI voice-cloning app for ALS patients to ignore mass-market advertising entirely, and instead manually cold-email 500 speech pathologists. The throughline is clear. Do not buy attention if you can earn it, and do not raise money to solve a problem that focus can fix.

If Green is right, the traditional direct-to-consumer playbook is backward. The goal is not to raise cash to buy customers. It is to trade ownership to the people who already have them.