Women aim to solve problems men don’t see, they invest in and elevate the people around them, they build inclusive cultures that foster innovation and collaboration, and, along the way, they deliver outsized returns for investors. And that is why we need to do these five things — and more — to empower women to become founders, and successful ones.
As a part of our series about “Why We Need More Women Founders”, I had the pleasure of interviewing Lynn Loacker.
Lynn launched and leads Davis Wright Tremaine’s Project W, an initiative with a single-minded goal of helping women build and lead the next generation of billion-dollar companies. Drawing on her 35+ years of experience as an M&A and corporate finance lawyer, a leader at law firms and nonprofits, and an angel investor, Lynn works with a devoted group of women at DWT who share a vision of a future where more companies are led by women. Project W tackles the problem of lack of funding and access for female founders through programming that includes the Women Entrepreneurs Boot Camp (WEB) for seed-stage tech companies, the Emerging Food Brands Lab for seed-stage packaged food companies, the SaaS Launch Lab in partnership with Microsoft’s venture fund, M12, for pre-seed SaaS enterprise companies, and the Tech Equity Hub, a 12-week accelerator for pre-seed tech companies founded by Black and Latinx female founders.
Thank you so much for doing this with us! Before we dig in, our readers would like to get to know you a bit more. Can you tell us a bit about your “backstory”? What led you to this particular career path?
When I graduated from college, I had no role models of women who were in business or professionals. My father owned a small business, and my mother was what was then referred to as a “housewife.” The professionals I knew — professors, bankers, doctors — were all men, relatives or family friends. When I started college in the early 1970s, I had no exposure to women with full-time careers. As a result, I chose to go to law school more or less by default. My goal was to have a life-long career that would enable me to be independent and, at the same, would allow me to demonstrate that I could hold my own and excel in a world that, at the time, seemed dominated by men. For me, law was the way to do that.
In the past few years, my career path has branched into new directions. I no longer actively practice law but instead have been focused on empowering female founders through Project W and by investing in companies founded by women and in funds managed by women. My younger self would have embraced the opportunity to be a founder, but that option was not remotely within my frame of reference. Although founding a company is a path not taken, I am experiencing the journey vicariously through my work with female founders.
Can you share the most interesting story that happened to you since you began your career?
I have been privileged to have many interesting encounters in my career, but this one describes an important “ah ha” moment for me. When I began my effort over ten years ago to meet women entrepreneurs, I attended a number of meetups of women in tech. One of the first turned out to be attended almost exclusively by programmers and developers, most of whom were half my age. Despite being the odd woman out, I enjoyed mingling with and meeting this engaging and smart group of women. Winding up a conversation with one young woman, she looked at me and asked: “How can I help you?” I was stunned. In all my professional interactions at industry gatherings — mostly with male bankers and lawyers — no one had ever asked how they could help me. This young woman’s casual — but clearly heartfelt — question introduced me to the extraordinary power of women helping women. Since then, I have seen that happen time and time again. It is what motivates me, and it is the engine behind the work we do at Project W.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
I was already well into my career when I made a series of mistakes that my colleagues found amusing and I found terribly embarrassing. In the early 1990s, I was leading what became the first deal in a series of transactions financing professional sports facilities. On that first deal my ignorance of professional sports was on display to the all-male team of lawyers and bankers with whom I was working. During the course of that transaction, I made numerous gaffes, referring to half-time as intermission and the locker room as the dressing room and, most egregious, observing that the Dodgers resided in Brooklyn. I learned two lessons. First, cultural fluency (in this case, sports stuff) matters. Second, if you are really good at what you do, you can move on from your mistakes. After that first deal closed, I was hired to work on more.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?
In the first few years of my career as a lawyer there were two senior partners — both men — who had a significant impact on my professional trajectory. Neither were mentors in the conventional sense. They didn’t give me career advice or share life lessons. Instead, each of them gave me really difficult stretch assignments requiring me to take on lead roles in novel transactions and, when I nailed those assignments, they became my most vocal advocates within the firm and with our clients. By giving me such career-defining opportunities, these two supporters raised my profile, instilled self-confidence, and emboldened me to tackle matters outside my comfort zone and frame of reference, all of which helped propel my professional path.
Is there a particular book that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
“Personal History,” Katharine Graham’s stunning memoir that was published in 1997. Graham tells her story with great vulnerability and candor and in doing so reveals what a remarkable woman she was -making the transition from wife and socialite to very successful business operator and developing into a courageous leader who was prepared to take enormous personal and professional risks in furtherance of her company’s mission. I read the memoir immediately after it was published, at a time when I was getting substantial traction in my law practice. I was bringing in significant clients, I was developing new practice areas, and I was leading large deal teams. However, I was also dealing with imposter syndrome and was second-guessing most of the decisions I made. Graham’s story came at exactly the right time and inspired me to be more self-confident, bolder in my decisions, and less concerned about how I would be judged.
Do you have a favorite “Life Lesson Quote”? Do you have a story about how that was relevant in your life or your work?
“Ginger Rogers did everything Fred Astaire did but backwards and in high heels.” It’s not clear to whom this quote should be attributed although it has been iterated on many occasions, most famously by Governor Ann Richards. The quote is a vivid metaphor for the gender equity gap. But it also speaks to how women rise to the challenge with skill, determination and incredible grace. A good reminder to all of us, whether a lawyer or a founder. Women do it differently, and we do it better.
How have you used your success to make the world a better place?
Women leading major companies have the ability to be incredible agents of change in their industries, in our society and in the world. I am deeply invested in fostering that change by helping female founders — and particularly women of color — build the next generation of billion-dollar companies. Women with diverse backgrounds and experiences see problems begging for solutions and envision innovative ways to address those problems. Women also build companies differently, investing in their employees, cultivating inclusive and collaborative cultures, and serving their customers with empathy. The trickle- down effect of women leading companies has the potential to be transformational, creating wealth for the women leaders and their employees (as well as their investors) and improving the lives of the communities they serve. With that in mind and with the support of my law firm, I founded and now run Project W , which has accelerated over 100 female founded companies. Our newest initiative, the Tech Equity Hub, aims to unlock the potential of ten pre-revenue tech companies founded by Black and Latinx female founders. Those founders are innovating in education, healthcare and commerce to address some of the most intractable problems faced by underrepresented communities. Without a doubt, these remarkable women will leave the world in a better place.
Like women in business, women in the arts are underrepresented, underrecognized and undercompensated. Yet women are producing some of the most innovative and cutting-edge artwork, music and theater, often pushing the boundaries between art and technology. Through my quarterly salon — Women + Art — I bring together an eclectic group of women of all ages and backgrounds who make and consume art and who envision how art through a female lens can tell unique stories, inspire change, and spur innovation.
Ok, thank you for that. Let’s now jump to the primary focus of our interview. According to this EY report, only about 20 percent of funded companies have women founders. This reflects great historical progress, but it also shows that more work still has to be done to empower women to create companies. In your opinion and experience what is currently holding back women from founding companies?
Broadly, two things: access and flexibility. Ironically, for an ecosystem that prides itself on being on the cutting edge, the startup world is replete with conventions. You are expected to start your company in college or shortly after graduating, collaborating with future entrepreneurs in your close circle. You take your idea through an accelerator that, until recently, often required you to be physically present. You hang out around people who can introduce you to venture capitalists.
That is not the path most female founders — particularly women of color — have the ability or privilege to follow. Female founders don’t have the same access to resources, mentors and networks of influence that their male counterparts do. And, while there is an increasing number of successful female founder role models, many women still can’t envision people who look like them running multimillion dollar companies.
Flexibility is also a problem. The optimal time to start a company often coincides with when a woman is immersed in parenting. Or it comes at a time when she lacks the financial safety net to quit her job and work full-time on a new venture. On the other hand, if she waits to start a company until her children are on their own and she has gained some financial security, she will likely face the double-whammy of gender and age discrimination.
Can you share with our readers what you are doing to help empower women to become founders?
Although a good deal of our focus at Project W is empowering women who have already thrown their hat in the entrepreneurial ring, we also provide programming and resources for women who are investigating an idea they may want to develop into a business. We have communities — like our FinTech Women and Women Owning the C-Suite — where we bring together women executives at established companies with women who have just started their businesses or are contemplating doing so. Our 1:1 With Black Founders initiative paired mentors with over 120 Black women who had just launched or were considering launching a business. And our monthly newsletter aims to inspire women to take the leap by introducing them to successful female founders and business executives and by providing a wealth of resources to help them on their entrepreneurial journey.
This might be intuitive to you but I think it will be helpful to spell this out. Can you share a few reasons why more women should become founders?
- They can change the world.
- They can dance backwards in high heels.
Ok super. Here is the main question of our interview. Can you please share 5 things that can be done or should be done to help empower more women to become founders? If you can, please share an example or story for each.
- Make room for moms.
Female founders fundraise and build their companies while they are pregnant, breastfeeding or on childcare duty. Building a company is hard enough, but doing so as a mother takes exceptional resilience, determination and management skill, all qualities investors look for in a founder. Despite the challenges, female founders are undaunted by the prospect of balancing work and family, seeing those demands as less of a barrier to success than men do. Female founders who are mothers turn challenge into advantage by honing the skills they need to become effective CEOs — delegation, prioritization, focus and emotional intelligence.
However, female founders who are moms don’t always have the luxury of showing up the way male founders can. For instance, Kristina Bergman, who founded Integris Software, participated in a panel discussion in our Seattle office with her baby in a snuggly, and Kim Gamez, founder of Mi Padrino, stepped out of our Women Entrepreneurs Boot Camp in April 2018 to breastfeed her newborn. There were undoubtedly numerous other occasions when Kristina and Kim had to navigate motherhood and entrepreneurship. But doing so hasn’t been a barrier to their success. Kristina had a successful exit selling her company to OneTrust and Kim went on to raise a seed round shortly after the boot camp.
Takeaway: If a female founder shows up to a meeting with her baby, don’t write her off. Consider it a sign of strength and a barometer of success.
2. Fund the female funders.
Venture funds sit at the top of the capital chain in the startup ecosystem, but less than 3% of venture capital is invested in female founded companies. So long as only a minimal amount of venture capital is invested in companies founded by women, female founders will continue to have an uphill battle accessing the funds necessary to build successful businesses. One way to turn on the venture capital spigot is to increase the number of venture funds managed by women. Women VC investors are twice as likely as their male counterparts to invest in companies with female founders and three times as likely in companies with female CEOs. More capital deployed by women VCs means more capital invested in female founders.
Yet only 5.6% of U.S. VC funds are led by women. And of the women-led VC funds, 90% are considered emerging managers (generally, first-time fund managers). As emerging managers, women VCs face formidable challenges. Raising a first fund is incredibly difficult, taking months to raise a $20 million or $30 million fund. Most first-time fund managers raise their funds from limited partners that are high net worth individuals and small family offices, not institutional investors.
Institutional investors hold the power of the large check but often operate under self-imposed restrictions on percentage ownership limitations or minimum investment size requirements, constraints that prevent them from investing in emerging managers even though emerging managers tend to outperform established fund managers. That doesn’t have to be the case, however. MassMutual recently used an innovative structure to catalyze a first-time fund focused on investing in underrepresented founders. With an initial investment of $5 million and a commitment of up to $5 million more to match new investments from additional LPs, MassMutual is fueling this emerging manager’s fundraising efforts and increasing their ability to make impactful investments in underrepresented founders
Takeaway. Seriously ramp up investment in women VCs and that will have an amplifying downstream impact on investment in female founders. This is not philanthropy. Because female founders have been found to outperform their male counterparts, the knock-on effect to LPs in women-led funds means higher returns.
3. Disrupt industry/fit bias.
Female founders typically raise less money, obtain lower valuations for their companies and retain less equity than male founders. And these disparities are even more pronounced if the female founder is operating in a male dominated industry. For example, a female founder is likely to experience significantly worse funding outcomes if she is building a fintech company rather than a fashion tech company.
At the earliest stage of a business, investors bank on the founder and her ability to bring a great business idea to fruition. Focusing on the experience and expertise of a founder will help eliminate bias arising from industry stereotypes.
Consider Tiffany Hosey, who has built a solution to streamline the supply chain and project management process in the construction industry. Tiffany ran her family’s construction company for seven years and holds a Class A contractor’s license. It took an outsider — a woman — to identify some of the intractable pain points in the male-dominated construction industry and develop a technology solution to address them. Or, Dr. Sandra Johnson, founder of the fintech company Global Mobile Finance. Sandra has 25 years of experience at IBM as a technology leader and as Chief Technology Officer (for Central, East and West Africa). She is a master inventor with over 40 issued and pending patents. And, as the first African American woman to earn a PhD in engineering, she is a “Hidden Figure.” Sandra built geeRemit, a unique relationship-driven remittance platform, to raise the standard of living for the people of Africa. Her incomparable combination of experience and expertise is driving Sandra to solve a huge problem and access an enormous market opportunity.
Takeaway: It’s the founder’s experience and expertise — not her chosen industry — that determines success. And it often takes someone who is not the stereotypical founder in a male-dominated industry to see through entrenched ways of doing things and develop break-through solutions.
4. Invest in Black and Latinx female founders.
Black and Latinx female founders get only a fraction of the miniscule amount of venture capital invested in women. They also usually start miles behind other founders on their entrepreneurial journey. Without the financial safety net that permits a founder to quit her job and spend full time on her company, without the friends and family funding that provides the runway to launch, and without the connections that provide access to resources and networks of influence, even the most brilliant and intrepid Black or Latinx female founder can’t easily bootstrap her way to a thriving business. Yet, despite these roadblocks, Black and Latinx female founders are identifying large-scale pain points and devising innovative solutions to problems that are waiting to be solved. And by doing so, they are building companies with the potential to tap into enormous market opportunities and to address pressing needs in underserved or underrepresented communities.
The ten Black and Latinx female founders in our Tech Equity Hub are doing just that. Among other things, they are building social emotional learning tools for urban schools, improving health and equity outcomes with access to safe and healthy food, using inclusive AI to deliver culturally competent dermatological care, empowering Black entrepreneurs with resources and exposure to thrive, providing prenatal care to address the high maternal mortality rates among Black and Latinx women, and creating new ways to foster cultural language learning.
Takeaway: Unlock the power of Black and Latinx female founders by supporting one or more of the many organizations that help these founders convert their enormous potential into impactful businesses, such as Black Women Talk Tech, digital undivided, Visible Hands, Women of Color Connecting and our own Tech Equity Hub.
Recognize that women aren’t less risk adverse, they just build better.
Starting and building a company is an inherently risky endeavor. Women are often held back by the misconception that they won’t build successful businesses because they are too risk adverse. However, more male founders see risk of failure and the need for financial security as a significant barrier to success than female founders do.
It’s not that women shy away from taking on risk. They just manage risk better — a phenomenon that was well documented after the Great Recession and continues to play out through the COVID-19 crisis. There is also a wealth of research that reveals that gender diversity on Boards and in C-suites results in better financial outcomes. The same is true in the startup world, where recent research indicates that female founders deliver better financial outcomes than their male counterparts.
But why is this the case? Among other things, women are found to be more open to change and more committed to investing in innovation. They also invest in their people and their corporate culture. No one could have said it better than Jennifer Hyman, co-founder of Rent the Runway, when she announced the company was providing the same benefits package to all company employees.
Takeaway: Women aim to solve problems men don’t see, they invest in and elevate the people around them, they build inclusive cultures that foster innovation and collaboration, and, along the way, they deliver outsized returns for investors. And that is why we need to do these five things — and more — to empower women to become founders, and successful ones.
You are a person of great influence. If you could inspire a movement that would bring the most amount of good for the greatest number of people, what would that be? You never know what your idea can trigger.
Inspired by our 1:1 With Black Founders initiative: The 30-Minute Mentor Movement.
If every MBA candidate and every operator, product developer and sales manager at a large tech company volunteered 30 minutes of their time to mentor an underrepresented or aspiring founder, the impact could be profound. Companies that have committed to diversity efforts could sponsor the build-out and maintenance of a website on which mentors and mentees could register, and those companies could provide the talent to develop the technology that would match asks and offers.
Much of our work at Project W is focused on mentorship. We occasionally hear from accomplished men and women in the Project W community that they have nothing to offer as mentors because they lack domain expertise, they have no entrepreneurial experience, or what they have to offer is too specialized or not the right fit. But our experience tells us otherwise. Consider this feedback we received from a mentor who has never founded or run a business but, instead, has a career in government service and government affairs: “As trite as it may sound, I think I’ve gotten as much out of the experience as I’ve given. And what [my mentees have] gotten from me in return is plenty of confidence building, which I think has made a big difference.”
The value of what is given and received in a mentorship relationship cannot be underestimated. And, if we can amplify that many times over the impact would be incalculable.
We are very blessed that some very prominent names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US with whom you would love to have a private breakfast or lunch with, and why? He or she might just see this if we tag them.
With great respect for all the accomplished and inspiring people in the world, I have already had my bucket list meal — with Justice Ruth Bader Ginsburg — who, since I was a young lawyer, has been my hero. Through her brilliant legal arguments and masterful strategy as to when and how to raise those arguments, Justice Ginsburg did more than anyone in the past 50 years to advance the cause of gender equity.
In August 2018, I was invited by my fellow Santa Fe Opera Board member, Roberta Ramo, to join her and her husband for lunch with Justice Ginsburg, her son, daughter-in-law, and grandson. We didn’t talk about law or the Supreme Court. We discussed opera and the movie On the Basis of Sex, which the family had just seen in a pre-release private screening (they liked it). When we left our table on the patio and walked through the long indoor dining area, the entire restaurant erupted in applause. The same thing happened that night at the opera. When Justice Ginsburg entered the house to take her seat, the entire audience rose in a standing ovation. RBG got a bigger ovation than Mozart.
If I got one more pass, I would choose Angela Merkel. Since 2005, she has led Germany, the EU and, arguably, between 2016 and 2020, the free world, with skill, empathy and courage — and, without ego. The photo taken in June 2018 at the G-7 Summit says it all: Merkel defiantly leaning in to address Donald Trump with the rest of the heads of state (all men) expectantly looking on and waiting to follow her lead.
How can our readers further follow your work online?
- Website: www.dwt.com/ProjectW
- LinkedIn: Project W: My Company | LinkedIn
- Twitter/Instagram: @dwtProjectW
- LinkedIn: Lynn Loacker | LinkedIn
- Twitter: @lynnloacker
Thank you for these fantastic insights. We greatly appreciate the time you spent on this.