Why is it so hard to find funding for women entrepreneurs?
And what superpowers will it take to change that?
You know the problem: Startup financing is demonstrably biased against women and minority owners, even though women start businesses at TWICE the rate of men. Women receive only 3% of venture capital and 5% of bank loans. Only 11 African American women TOTAL in the US have received Venture Capital exceeding 1 million dollars. This despite statistics showing that women-led, venture-backed companies are less likely to fail, use less capital, and had 12% higher annual revenues than those led by men. The unequal opportunities for women, including the lack of financing for women entrepreneurs, causes the US to lose out on trillions of dollars in annual GDP.
In response to this systemic problem and corresponding opportunity, several of us women entrepreneurs (Mara Zepeda, Paige Hendrix Buckner, Genevieve LeMarchal and I) created the XXcelerate Fund, a revolving loan fund and peer mentoring program for women founders with growth-stage companies. We are piloting the Fund and wraparound programming in my home state of Oregon, with plans to expand nationally.
You’d think it would be easy to attract funding for this from impact investors! Guess again.
Would you be surprised to learn that one funder pushed us (an organization led by all women, including a 3/4 POC board of directors, with a pipeline of 100% women, 55% of whom are POC) on inclusion goals, but not the men applying for the same program? Or that another proudly stands for changing business as usual in the name of equity but asks us to first show 4X our requested investment before they can come in, “because that’s just the way it has to be”?
So, how do we crack this nut? Or where do we get the superpowers needed to crack it?
Looking for your suggestions and ideas!