10 female founders get real about sexism in the murky world of startup fundraising
After Jessica Perez — a model and entrepreneur who founded Tycoon, a personal finance app for freelancers — pitched her product to an investor, he sent her a Snapchat video of himself looking at bikini photos of her on his laptop. Another investor promised her connections to angel investors but followed up by inviting her to a movie premiere. Another turned a lunch meeting into a lunch date, a shift she didn't realize until he started flirting and asking her if she was seeing anyone.
"I don't think I've met a single female founder who hasn't had at least one creepy situation with an investor," Perez said.
Women-led companies were involved in just 4.94% of VC deals in 2016, Fortune recently reported. That is the highest it's been in the last decade, and the gender divide isn't exclusive to those seeking funds: There's also a massive gender gap in those writing the checks. Only 7% of partners in venture capital are women, according to a 2016 TechCrunch analysis.
The funding gender gap has gotten worse, too. Why is it that women received only $1.46 billion in VC money in 2016, per Fortune, compared to companies with all-male founders that raked in $58.2 billion?
It turns out getting hit on is just one of a number of discriminatory situations female founders face when seeking funding for their products — whether it's an investor telling them they need to talk to their wife to understand why the product might be valuable, or telling a woman of color that eliminating unconscious bias in recruitment isn't solving a real problem.
Mic spoke with 10 female founders about what it's like to ask a room full of wealthy men to take them seriously — and why we need more women on the other side of the table.
Introductions
1. Natalia Oberti Noguera: Founder and CEO of Pipeline Angels, a network of women investors. Oberti Noguera compared it to Shark Tank: "There are enough white guy sharks out there. I'm in the business of creating more women and nonbinary femme sharks," she said.
2. Kelley Calkins: Co-founder and news director of the Establishment, a woman-funded and -run multimedia company centering marginalized voices. They are currently in the throes of fundraising. Calkins said the process is "demoralizing in ways I couldn't have anticipated."
3. Sophia Yen: CEO of Pandia Health, a startup that offers free birth control delivery and automated refills. Yen said many of the older men she pitches to just "can't feel the pain point" that she is addressing.
4. Alisha Ramos: Founder of Girls' Night In, "a newsletter for boss women." She interviewed 40 people, both venture capitalists and women entrepreneurs in tech, for her senior thesis at Harvard University in 2012 on women in VC. "They're all the typical horror stories," she said.
5. Lizelle van Vuuren: CEO of Women Who Startup, a global learning platform for women entrepreneurs and innovators. She said it wasn't until she started her own company that she realized the lack of women in the room.
6. Rachael Shayne: CEO of Cubspot, an online resource for parents to find and book their kids' summer camps and classes. Shayne has gotten about 46 "no"s so far. "I have yet to pitch a woman," she said.
7. Aihui Ong: Founder and CEO of Love With Food, a product-sampling platform that collects product intelligence data for consumer food brands. "I'm not Ivy League," Ong said. "I'm an immigrant. I'm a solo founder. Those were all against my odds. But I didn't give up. I kept on trying. Some people just have a tougher life than others."
8. Deb Perkins: Co-founder and CEO of Cat Perkins, luxury convertible shoes. "The vast majority of VCs we've been able to talk to are men," she said — men who don't understand what she's offering.
9. Stephanie Lampkin: Founder of Blendoor, a "blind recruiting" app and Pipeline Angels portfolio company. "It's tiring that I'm trying to build a company that mitigates unconscious bias in hiring — but in doing so I face the exact same challenges in fundraising," she said. "Ultimately, there is not an African-American woman creating a billion-dollar tech company."
10. Jessica Perez: Founder of Tycoon, a personal financing tool for freelancers. Perez transitioned from the fashion industry into tech. "It always feels like 98% of the room is white guys," she said. "That really shocked me in getting into this world."
What is it like to pitch as a female founder? First of all, you're almost always speaking to a room full of men.
Shayne: "I have yet to pitch a woman."
Yen: "As a woman in femtech pitching a product, I do feel a disadvantage when I walk into a room of angels and there are only two women in the room [who'd] understand the pain point that I'm presenting."
Perez: "I don't know what the numbers are, but it always feels like 98% of the room is white guys. That really shocked me in getting into this world, because I was like, 'Oh my God, where are the women?'"
Perkins: "The vast majority of VCs we've been able to talk to are men. I think I've talked to, I want to say, only two women. If I added private equity to that, three or four women."
Ong: "As an immigrant, [I find it] shocking when I go into partner meetings and it's not very diverse. Especially in Silicon Valley, [where] everyone comes from different places. But the VC world is still very dominated by one gender."
Perez: "I think that the things that bother me the most are things like getting on a VC firm's website and seeing that the only women out of 14 people listed are, like, the office administrator or the marketing assistant or some marketing intern. It's always marketing manager or marketing intern. It's never the managing partner. ... You don't really see a lot of women in higher-up roles at 'average' VC firms. It seems like they [have] random positions up there for women to make it look like they're diverse. It's not diverse if the decision-makers are still all white men. That's not diversity."
If the product doesn't affect them, they probably won't understand its value.
Ong: "If your business is very female-related, it can be difficult to explain to a man, or they cannot relate."
Yen: "The main disadvantage is that [male VCs] don't understand the value proposition of my company because they haven't personally experienced [the issue it solves] themselves."
Perkins: "VCs fund businesses that fall into their areas of expertise, so they invest in tech or health care or some area of a business that they're experts in. And if you consider that the vast majority of VCs are male, then you understand that you're at an immediate disadvantage having a product like a woman's convertible shoe."
Shayne: "They don't believe I'm solving a real business problem. ... A large percentage [of them] have told me, 'I don't think you're solving a problem that needs to be solved.' And even though I've got statistics to talk about how this largely affects women, especially working women, they are very suspect because they can't relate to the business."
Perkins: "I've had women VCs I've met with who have said, like, 'Oh my God, this is great. I love this, but I can't tell my team that I want to invest in shoes.' It's kind of like, wow. This woman understands the business opportunities, she understands the product and what a step forward it is, but she doesn't want to bring it to her male partners. ... I've [also] had many men say to me, 'It looks like you have a great team, I love the idea, the financials, everything looks great. But I wear brown shoes, black shoes and sneakers, and I just don't get why women would want to change their shoes.'"
Shayne: "It's very hard to empathize with something that you either haven't had to deal with or haven't had to deal with for a decade. Two of the guys have said, 'Hey let me talk to my wife,' or, 'I'm going to a dinner party, let me ask around.' It's hard to get them back to the table after that. ... Learning to appreciate and hear a different point of view is remarkably hard and a different behavior. And so a lot of these guys, they're dealing, they're good, they've got money — what's the incentive to change?"
Male VCs typically want to fund people who look like them and have similar pedigrees and social lives.
Oberti Noguera: "People invest in what looks like them. People invest in the familiar."
Shayne: "I call it the 'confidence goblin' that's always surfacing that tells you you're a total imposter. When I see that, how can I tell them a cogent story when I'm not from Stanford, I'm not from Harvard, I don't have a data analytics background and I'm a first-time startup CEO."
Lampkin: "As an African-American woman, if you are trying to judge me with the same rubric that you've used to measure successful white and Asian men, then I'm never going to measure up. There is no precedent. I come from a background of poverty. Yes, I graduated with a Stanford engineering and MIT degree and went through a major accelerator and checked all these boxes, but the fact still remains that I'm not going to have the exact same story and path and trajectory as my peers."
Ong: "I went to the National University of Singapore. I'm a computer science engineer. My background is building complex financial systems. And when I went up to pitch, I had more than 12 years of engineering experience. Was that credible? No. ... If you're a newcomer into the scene, they don't know how to vet you. I would say VCs, their safest bet right now is to go by your pedigree. 'Did you go to a good school?'"
Oberti Noguera: "Pattern matching, pattern recognition ... [let's turn] the concept on its head. If people invest in what looks like them and what's familiar, let's get more of us on the investing side because we are probably going to be more open about investing in more of us on the entrepreneurship side."
Yen: "Connections [matter] too. I'm not a sports person, and I'm not willing to learn or play sports just to get in on that. Or go to bars. That's not my scene. I'm done with that. But a lot of these [networking] events are about drinking and watching sports. I can't do that. I mean, I can go to your bar, but I'm not going to be happy. I'm the CEO and I'm a physician, and I know I have to do whatever it takes and I will suck it up."
Geography can be an unexpected disadvantage.
Ramos: "VCs are more likely to fund entrepreneurs and companies that are nearby just because it's easier for them to get access to the founders and help them build a network, etc., so I think the geography bit is definitely prohibiting the inclusivity."
Shayne: "I love my network, I have an awesome one in Colorado, but that's not the network that is going to turn around and scratch a check. ... I need a network of not just support — I need a network of net worth."
Ramos: "Steve Case's venture capital firm here in [Washington] D.C. is doing this campaign called Rise of the Rest, where he tours around different cities and looks at places beyond Silicon Valley and New York and the typical geographies, and I think that's a really interesting movement."
Oberti Noguera: "We are launching in Miami this spring because not all entrepreneurs are wanting, willing or able to go to Silicon Valley, which is also one of the issues. 'Access' is also a geographic access that for a lot of entrepreneurs — they may not have that available. We are focusing on activating local capital for local entrepreneurs, heading to Miami, engaging and activating individuals who should be investing."
Women will always have more to prove.
Ramos: "I coined something called 'gender valuation,' and it's basically the shared cultural belief in the venture capital and startup industry that anything that is gendered masculine is more valuable than anything that is gendered feminine. And I found that to be true of the people I that spoke to, even women investors would say things like, 'Oh yeah, in the workplace I'm the only woman investor so I need to act more masculine.'"
Lampkin: "I realize just how significant-relationship-based and emotion-driven these decisions are. [VCs] will say, 'It's a little too early, but keep us in the loop and let us know when you hit these goals.' And then I reach back out and they keep moving the goalpost. But little do they know, I track their portfolio and who they are investing in, and I've realized that the pattern is that they invest in people and things that are either closely connected to their network or sort of match the same pattern."
Ong: "The biggest challenge I had was being a solo founder, because it was being called out again and again. That was the main thing. No one would probably say, 'Oh yeah, a female, I'm not going to fund you,' but they'd say, 'You're a solo founder.'"
Calkins: "I see all the ways dudes have space to be mediocre and to really rake it in. So this whole narrative about the best companies rise to the top and this meritocracy, it's just not real. And I just see so many of the gatekeepers feeding themselves this to be able to sleep at night, I guess, or to protect themselves in their little fortresses."
Oberti Noguera: "One of the things people say in the corporate world... 'Women get promoted on performance, and men get promoted on potential.' That same finding applies to the startup world. You hear that guys secure tons of funding out of a paper-napkin idea versus I hear so many women and femme entrepreneurs, they have numbers, they have traction and still they hear, 'It's not enough. You need to come back with more proof.'"
Many women have horror stories of dealing with outrageous sexism.
Calkins: "It's just like a twisted little wonderland. Maybe 'wonderland' is the wrong word. Hellscape — a twisted little hellscape."
Perez: "I had another investor turn a lunch meeting into a lunch date that I didn't realize I was on it until I met up with him. He was really flirty initially and then started asking questions about if I was with anyone. ... I had another investor send me a video on Snapchat of him looking at bikini photos of me on his laptop."
Yen: "It's strange when a VC tells you that they are single, and you have to interpret ... what they are trying to tell you with that. And as they get friendly to you, and you start to make it clear: 'I'm married, I have children, my husband...' I shouldn't have to do that. We should just be professionals here. ... Do I just ignore this because I need to get funded? ... You don't want to offend anyone."
Lampkin: "One of my first pitches happened, it was sort of a rapid-fire interview with a major accelerator, and I was going through all the details and one guy stopped me — and mind you, it was eight guys, all white or Asian. He said, 'Are you really solving a problem? I just hire the most qualified people. I don't see race. I don't see gender. I would think someone like you with a Stanford and MIT degree would have people messaging you all the time for interviews.' And that's sort of when I realized there's an education about diversity and the lack thereof, because here I was on a panel of all white and Asian men, and they didn't really see the value of diversity."
Shayne: "I've had at least three of those meetings: It comes time to talk about financing and they turn to my co-founder — who I love, he's one of the best men I've probably ever worked with — but they assume that I don't know the math part. When it happened the first time, I couldn't believe that this was real life, but then it happened two other times and [I thought], 'Oh my God. ... I know math. I can't believe he just made that assumption.' But in all three cases it was just much-older white men."
Ramos: "In my research I interviewed 40 people, either venture capitalists or women entrepreneurs working in technology. ... [They shared] typical horror stories: 'Oh, I went into an investor meeting and they completely did not understand what I was trying to pitch them and they brought in their wife,' or they would call their wife, or, 'They made me walk down the block to his apartment to talk to his wife,' or brought in the secretary and asked her if she would ever use this product."
Perez: "Is [their curiosity] coming from a good place? Are they genuinely interested in my business, or is this going to turn into something, like, 'I've never met a woman like her before. Let's date.'"
Shayne: "A real response from one of the guys I met with, who has known me for five years at least: When I told him I took over as CEO, he snickered. He was like, 'You're the CEO?'"
Perez: "[They asked me] who gave me this idea instead of how I came up with it. ... After a few of those meetings, I actually asked one of the investors I spoke to, 'How many female founders have you invested in?' And he sort of seemed taken aback by my question."
But the statistics prove diversity is good for business.
Ong: "If [VCs are all] the same gender, it might create opportunity loss because you might not see the goldmine."
Ramos: "There are a lot of problem areas that women and people of color are thinking about that are profitable — problem areas that … maybe traditionally venture capitalists have glossed over or dismissed. It will be a huge win-win for both investors and entrepreneurs the more diverse this entire ecosystem becomes."
Shayne: "There's tremendous opportunity just in that genre alone, in building companies that are inclusive from the ground up. [It] will eventually make a difference and [make the company] a place where people want to work."
Yen: "Maybe an investment in a woman is more risky for some reason, though they've shown that when you have a woman at the table, your company in general does better."
Van Vuuren: "You can look at a lot of companies today who are really struggling with not having a diverse perspective in leadership, and they are struggling and it's obvious why."
Yen: "It's trying to explain birth control to a guy and really it hits home on 50% of the population, but if 80% of companies are not that population, it's still an important and viable field to fund. VC firms should look at this field and maybe dedicate a certain percentage to this field as opposed to, if it happens then it happens."
Oberti Noguera: "There are all the studies and reports that showcase gender-diverse teams and women founders outperform the market, and unfortunately that still hasn't been enough to influence the status quo."
Calkins: "There's just so much data, if teams are diverse, the companies perform better, and there's parts of me that are just... We should be doing the right thing because it's the right thing, but there are times when I'm like maybe this whole rhetoric around all the profits that you can make if you have a diverse team, maybe that will take hold. Maybe this kind of data will trickle down and maybe someone in VC will take note of it and really care, maybe not for the ideal reason but for financial ones."
It's not just a gender gap — we need to talk about intersectionality.
Lampkin: "Ultimately, there is not an African-American woman creating a billion-dollar tech company. So when [VCs] see me walk into the room, there's no precedent, there's no mold for which they can say, 'Ah, I know what a successful person looks like that looks like her.'"
Shayne: "It seems like it would be so self-evident, if you're constantly thinking, 'Oh, I'll have to ask someone who looks like you,' that maybe just having someone that looks like you at the table would be expeditious, and isn't that a financial gain in itself. What I really want to be is a really great example of a woman-run tech company, especially out of Boulder [Colorado]. Boulder is super-white."
"There is not an African-American woman creating a billion-dollar tech company. So when [VCs] see me walk into the room, there's no precedent, there's no mold."
Oberti Noguera: "I'm a cis LGBTQ Latina, and so when I'm thinking about changing the face of angel investing, I'm very aware that I don't want it to just mean, like, let's get more white women to invest. I want to make sure we also get underrepresented communities, such as black women and Latinas and also making a huge push to get nonbinary femmes included in the conversation. ... [As a cis woman], it's one of those identities where I finally have privilege … and I want to be as much of a supporter as I can."
Ramos: "As a woman and woman of color founder, I need to work twice as hard as a white male, pretty much. I don't think that I have the luxury of showing up to someone's office and saying, 'I have this idea, can you fund me?' I don't think that typically works for women of color founders. Women of color founders have to back your ideas up with real business, real data, real traction, a real path to profitability. My approach is hustle twice as hard. It's just the way it is. That's the landscape and that's what you have to work with."
Lampkin: "The often-overlooked aspect of this discussion around gender and investment and VC and fundraising is intersectionality. I am a woman, I am also gay, I am also black, and so I straddle all of these marginalized groups. I'm also 5 feet tall. There are elements to everyone's experience that are really different. As a black woman, I don't have the privileges that white women have in terms of making that connection."
Perez: "The lack of minority diversity in the tech industry is crazy. If I feel uncomfortable as a white woman, I can't even imagine if I were a minority woman. You don't see really see that many minority men either. There's just not a lot of racial diversity at all in the industry. And I feel like the focus right now is to fix the gender gap, but I don't really see as many people talking about the problem that again, you don't see the diversity at the top at the VC firms. Where is the representation of different races as the decision-makers in the industry?"
Why we need more women on the other side of the table (writing the checks):
Perkins: "I think the obvious advantage to having more women in the business is that for any of us to invest in anything, most of the time we have to kind of understand the idea and feel comfortable we are investing in something that is going to work. This is just the problem when you're trying to pitch to a man. It would be much easier for a woman to assess and have the financial power to invest. That's the problem. There aren't enough women who have enough financial power to fund these businesses."
Van Vuuren: "I didn't have any female mentors. ... I didn't have the visibility of other women kicking ass and taking names. And that was a real problem because you start to believe that narrative, and it starts to put your own confidence in question. Inclusion and having diversity at every table gives a different perspective, gives a different opportunity to learn."
Ramos: "It's getting more women and people of color into the other side of the table, getting more women and people of color to write the checks as investors. I truly think that's key. Having more women and people of color on both sides of the table will, honestly, I think it will help the venture capital industry address their blind spots."
Oberti Noguera: "Our latest pitch summit we created these pocket mirrors, and on the back it says, 'We see you.' A lot of people are not just not seeing more voices. They are also deliberately trying to erase us. And so it's more important now than ever that we see each other. I've shared with our members — we now have 200-plus members — that we need them to step up to the plate even more now, because startups led by more voices are going to need even more support."
Lampkin: "This is a hasty generalization, but a woman in VC is more likely to be able to understand the value and the founding story of a fellow female entrepreneur who is working in a space that targets women than a group of nothing but guys at the table, and that's pretty obvious. But I think people really take for granted the value of having that voice at the decision-making table."
What women seeking funds can do to weather less discrimination in the meantime:
Van Vuuren: "Making women visible is huge. ... I'm not just talking about the United States, where we have more access to a lot of this thriving economy. I'm talking about rural areas where women do have access to the internet but they don't have access to real-time learning and collaboration and a kick in the ass and support from other women who are saying, 'Hey, I'm out here in Kansas. This is what this community is like.'"
Ramos: "When I first wrote my research in college, I had a very naive understanding of venture capital. I thought in order to be a successful business, you must pursue venture capital and lock that down. But I don't think that's the case. In fact, I think a lot of successful companies bootstrap their way to success. For example, just listened to the How I Built This podcast by NPR. They did a really great episode with Kendra Scott, who created a jewelry line pretty much out of her apartment, bootstrapped it and now it's valued at [about] a billion dollars, I believe. The main takeaways for me after having done so much research is, I have to work twice as hard and I also need to think really deliberately whether or not the type of business I'm building even requires venture capital funding."
Perkins: "I would have done more research earlier on to find the women in VC, in the VC space, if I had understood what an advantage it would be to pitch to women. As an entrepreneur, the most important thing I have is time really — I know that's a half-made expression, but it's really true. It's just a giant waste of time. What you're trying to do is find money as quickly as you can so you can keep your business afloat. Talking to people who don't get it, it's a big time-waster."
Lampkin: "Probably the biggest lesson I've learned around fundraising in particular is I should have been more strategic on focusing my time and energy on people and organizations that are really, really passionate about what we're doing or my story, because ultimately those champions are the ones that will refer you to people and be a strong voice when you're not in the room. That's really how these decisions are made."
