Changing Tides: Powerful Strategies for Female Founders (a summary)
Earlier in the year I contributed a chapter to Jennifer LeBlanc’s book, Changing Tides which released this month (Nov2018). My chapter is called Activating the Mesh Network: Female Angels Investing in Female Founders. I am pretty excited about being a part of this book and plan to share it with some of the female founders and investors in my network, highlighting salient sections for them. I also plan to share this with some folks who aren’t listening to the data and our true stories as female founders and investors.
I posted on LinkedIn that I was summarizing these points and was asked by a female colleague to share my notes and highlighted sections so here you go, Amanda.
Introduction (Jennifer S. LeBlanc)
Statistics around funding for female founders and how investing in female founders makes good business sense.
‘The data for female founders and female funders is inextricably linked’
‘Yet businesses founded by women ultimately deliver higher revenue — more than twice as much per dollar invested — than those founded by men, making women-owned companies better investments for financial backers.’
‘It follows that having a more diverse set of viewpoints makes it more likely that an organization will be more flexible, more responsive, and more likely to reflect the needs and values of its customers.’
Male and female founders are asked different types of questions leading to greater funding for men. When female founders answered questions as if they were ‘promotion oriented’ the funding increased by 14X.
Changing Tides: Investing to Change the Tide (Maha Ibrahim)
Women need other women at the investment table and need to do a better job of supporting them and female founders.
‘They are, in fact, two to three times more likely to receive funding if there is at least one woman on the investment team.’
‘Women often don’t have access to funds because the investment table isn’t open to them.’
‘By mid-career, most women have left [VC] because they were being treated badly and were tired of it, and either got out of investing completely or started their own firms.’
Investors need to recognize and remove their biases around women as CEOs, leaders, and founders.
‘Women are frequently asked questions like “Why are you the CEO?” and “How do you know this business?” They are questioned in ways a man would never be.’
‘It’s important to not talk to female founders about maternity, motherhood, or how to figure out how they can “do it all.”
Seeking Unicorns in Uncrowded Fields (Gillian Muessig)
Female founders encounter obstacles and disadvantages throughout their startup journey that their male counterparts do not.
‘VCs ask men “forward-looking” questions such as, “What are your plans for capturing the market?” Women are asked prevention and disaster-containment questions, such as “How will you prevent customer churn?”’
‘Women are funded less frequently, at lower valuations, and receive less capital per investment. They must launch, prove their markets, and expand with less capital. They have fewer role models, mentors, and champions.’
We need to recognize the power of diverse teams and women as an underutilized economic asset
‘Diverse teams consistently bring in higher ROI.’
‘Diverse leaders make companies more resilient and more capable of acquiring new markets more efficiently.’
‘Diversity isn’t just a social or political movement. It is a business imperative, both in terms of the potential implications, but also the potential to drive higher innovation and returns through diversity.’
‘The entire world stands to gain trillions of dollars in annual economic value by giving women equal opportunity to engage in entrepreneurial efforts and leadership roles.’
Activating the Mesh Network: Female Angels Investing in Female Founders (Terri Hanson Mead)
Female founders do not get the same level of attention of funding from the primarily male investors.
We need more female investors to create a separate funding and support ecosystem and we need to build our own ‘mesh-network’ of like-minded investors globally to activate the capital necessary to create a whole new financial ecosystem. This ecosystem needs to be one that actively supports and invests in products and services designed for women. Let’s support successful female-led businesses and create massive FOMO for the male investors!
Angel Investing: More Fun than Burning Cash in a Trashcan (Xandra Laskowski)
We need to activate and educate more female investors.
‘The only way we are going to change the make-up of business top management and boards in this country is by empowering women to be a part of the conversation in making these decisions in the first place.’
‘I saw angel investing as a form of financial activism.’
It Takes a Village: How Joining a Community and Increasing Your Radius Helps Female Founders Raise Venture Capital (Suzanne Fletcher)
Female founders will increase their likelihood of success by being a part of a trusted community of founders and growing their networks.
‘Trusted communities can support and benefit all founders, but I have seen a particularly powerful effect for founders from under-represented demographics (e.g. women, minorities) as they are able to connect with others and grow their networks.’
‘91% of our female CEO companies are still operating or have been acquired, compared to 84% of male CEO companies.’
‘Introducing other high-potential female founders to the investors you know also builds your credibility.’
‘Paying it forward means helping other women entrepreneurs at earlier stages get to know the investors and founders in your network.’
“What Did the Other Women Wear” (Amy Belt Raimundo)
Women are treated differently from men and men don’t even know it when women are not in the room.
‘men don’t notice when women are absent.’
‘Systemic bias still exists within organizations but shows up more subtly. It shows up as having to prove yourself, sometimes multiple times, before getting the credit for your experience and insight that male counterparts with far less experience are given.’
‘despite studies that show that having a blended gender team (including boards) correlates with superior financial results, companies and firms don’t internalize this.’
‘When we can’t appreciate the problem ourselves, we tend to dismiss it, even in the face of evidence.’
Some important tips for women in a male-dominated room.
‘It’s important to take your rightful place at the table and avoid the traps that undercut your points. ‘
‘Create your own networks.’
‘You have to play a riskier game to win.’
The Strength of User Empathy (Mokund Mohan)
Women have greater user empathy which leads to better products and greater profitability.
‘Women entrepreneurs have significantly higher user (customer) empathy which resulted in early adopter retention rates 8 to 11 percent higher, and user churn 50 to 75 basis points lower than that of their male counterparts.’
‘there are three clearly recognizable traits tied to people with high user empathy. They are active observers; they are extremely resilient; and they are incredibly resourceful, which helps them iterate through problem-resolution loops more quickly.’
‘women are significantly more alert than most men. They watch everything. I mean they observe at least 50 to 80% more than the average man.’
‘Resilient women are always making a backup plan for the backup plan.’
How to Be Tenacious Yet Gracious While Raising Capital (Deb Kilpatrick)
We cannot ignore the male/female dynamics in fundraising.
‘Enter into funding conversations with your homework done; speak with authority; and make yourself seem as experienced as possible.’
‘My favorite piece of advice for how to survive the sexism in Silicon Valley, or anywhere else, is that you must be tenacious but gracious. Focus all of you energy on your goal. Don’t let anyone distract you.’
Women must take on the task of creating the next generation of leaders.
‘If we want to see a change and more diversity among leaders in Silicon Valley, women need to step up and actively create the next generation of leaders who are more diverse and who also appreciate the importance of diversity as a means of competitiveness.’
Going It Alone: Thoughts From a Solo Female Founder (Dorin Rosenshine)
Women are on average more risk averse which can lead to more positive results.
‘This risk aversion makes female-led startups more likely to be successful because (surprise) thinking through actions before jumping in pays off.’
‘chances are that being stronger about promoting yourself, your skills and your company can help you achieve more without worrying about pushing too hard.’
Focus on the people who want to help you.
‘female founders are judged far more negatively than their male counterparts.’
‘The sooner you eliminate these people from your life, the faster you’ll be able to re-center your efforts on moving your company forward. Focus on the people who want to help you and you will go far.’
‘Simply have confidence.’
10 Rules I Live by as a Female Founder (Tammy Bowers)
Being a mom prepares you to be a CEO.
‘On a daily basis as a mom I have had to manage multiple schedules, be in two places at once, be a nurse, taxi driver, counselor, and proficient in all studies including physics, chemistry, Spanish, and even spelling.’
‘the best ideas come from solving your own problems.’
‘know what you need.’
‘Find your magic.’
Self-Care and Optimizing Yourself for Peak Performance (Robyn Ward)
Self-care is critical to your success.
‘As a founder, your job is to bring your best self to work.’
‘Startups are hard and founders are not superhuman.’
‘healthy and happy founders build healthy and happy companies.’
‘Self-care is in fact a habit.’
‘Commit to one disconnection a week.’
‘Making time for yourself and making time to figure out your needs are perhaps the best investments you can make in your life.’
What’s Different about Unicorns (Jessica Livingston)
Don’t be afraid to think big, to be a non-conformer, to overcome your fear.
‘The fear of big ideas prevents most people from realizing they could expand a site for college students into a site for the whole world. But a few people are more excited than afraid when this happens.’
‘You need to be independent-minded. You can’t care what other people think. It’s now part of the conventional picture of a successful founder to be a maverick. ‘
From Entrepreneur to Leader (Kate Purmal)
How do you make decisions?
‘Inexperienced leaders struggle to know when to take charge and when to let others take the lead.’
‘startups must be able to make decisions rapidly.’
‘decision authority ultimately needs to rest with someone.’
The importance of resilience.
‘a growth mindset is a critical factor to resilience and success.’
‘Entrepreneurs can build resilience into the business structure itself, making it safe for others to take risks.’
‘Treat the startup experience as a series of experiments.’
CEOs must be strategic with their time and clearly articulate the vision.
‘Preserve your time and energy for the tasks that require your attention and abilities, such as long-term planning, hiring, and strategic decisions, partnerships and negotiations.’
‘The better you define your vision for yourself and your business, the better you will be able to collect evangelists, fans and funders.’
Closing Thoughts On Changing the Tides (Debra Vernon)
Now is the time for change.
‘We all need to work together to change the tides.’
‘The tide is changing but the pace of change is slow.’
‘Raising the consciousness of our own organizations will also help us accelerate change.’
‘If being a male college dropout makes you a hero in venture capital, women can’t win under the current playbook. We need a brand-new investment model. A model designed by and for both men and women. Where funding decisions are made in a process that is transparent and systematic. A change in the tides.’