Where are the women in tech on panels at conferences? Why aren’t VCs funding enough women-run startups? We have been wrestling with these questions for years, and yet we just can’t escape this conversation. As Cathy Brooks said on her recent BlogTalkRadio show“The Social Media Hour,” “It’s like a piece of packing tape stuck to the bottom of my shoe.”
While there are several prominent women who have launched their own startups and received VC funding, such as Rashmi Sinah co-founder of SlideShare, Mary Hodder, who founded Dabble.com and is launching her second startup Wellness Mobile, Caterina Fake who co-founded Flickr and is now spearheading Hunch.com and one of the Partners at the Founder Collective, which has funded three women startups, the fact remains that over 90% of VC money goes to men.
Cindy Gallop, who founded IfWeRanTheWorld, says that diversity is a key dynamic for true innovation and that it’s critical that the VC world expand their portfolio and stop looking at templates.
Allyson Kapin: There was an article in the NYT discussing the lack of women getting VC money. About 90% of VC money goes to men run start-ups. Why do you think there is such a large disparity? What’s the disconnect? Forty percent of businesses in the US are owned by women but are enough women even seeking VC money?
Cindy Gallop: VCs fund in their own image: white, male. The cycle is self-perpetuating, so (predominantly male) VCs have a preconceived notion in their heads of what they think constitutes the kind of entrepreneur to back. John Doerr apparently said, ‘If you’re a white, under 30, tech geek with no social life and a Harvard/Stanford dropout, line up for VC money.’ He didn’t say ‘male,’ but he might as well have. If it had been a 17-year-old Russian girl who came up with ChatRoulette would there have been as much interest in funding whatever she might do next?
VCs also tend to have a preconceived notion in their heads of what making a startup successful entails – best summed up as ‘working till 4am every night, sleeping on the floor of the office, subsisting on ramen noodles.’ This belief in a single ‘machismo endurance’ model means they think women aren’t capable of doing what it takes to bring a startup to market. Whereas in my experience women are actually much more doggedly tenacious than men in this context. We’ve learnt to expect many more obstacles, we know VCs won’t fund us, and so we grit our teeth and make it happen. With every barrier I encountered to getting my own startup, IfWeRanTheWorld, funded, I just went, ‘I am going to bloody well will this venture into existence through sheer force of determination.’ And I did. VCs often don’t realize what women entrepreneurs are really capable of.
I think not as many women as men actively seek VC money because they’re not as tapped into the boys network as male entrepreneurs are. Young male entrepreneurs can very easily become the flavor of the month and get introduced around from one VC to another — get the perception going that they’re ‘hot’ and get their funding. It doesn’t happen for women that way.
I ended up actively avoiding VCs when I was seeking funding for IfWeRanTheWorld. I met a few, genuinely visionary VCs who gave me some very good advice, but I also met some very conventionally-minded ones, and it’s so tough getting a startup off the ground as it is, I decided I didn’t need to bang my head against closed doors. I didn’t need any more thoroughly depressing conversations than I absolutely had to have.
AK: In talking with young women entrepreneurs and women thinking about starting their own businesses, fear of failure is a common obstacle I hear about. A) Do you hear this from young male entrepreneurs? B) What’s your advice to women who are thinking about launching their own start-up but are “stuck” because of their fears of failure and public criticism?
CG: That’s funny, because I talk to a LOT of young women entrepreneurs and women thinking about starting their own businesses who come to me for mentorship and advice, and I don’t hear fear of failure. What I hear much more is lack of self-belief — and often that’s because, particularly in the tech arena, women are embarking on a journey where they see very few role models and they encounter a lot of established male ‘rules’ as regards ‘This is how you do things.’
A) No, young male entrepreneurs are very rarely lacking in self-belief (but they do have fear of failure). B) My advice to women is, stop listening to the (usually) men who tell you how to do it, and do it your own way. I talked to one woman entrepreneur who wanted to launch a financial services startup, but was finding it difficult within the existing financial markets system. I said to her, ‘What would the financial system be like if women had designed it? Stop trying to make your startup work within the constraints of a masculine-designed marketplace, and rethink finance itself completely. What would you change? How would you redesign it? And then how would you make your startup really fly within that?
AK: Why is failure sometimes a good thing?
CG: If you don’t fail, you’re not aiming high enough. If you don’t fail, you’ve never done anything worth doing. No one should be afraid of failing. You learn from failure, and failure often hides opportunity and a whole different path. The important thing is that you pick yourself up and you get right back in the saddle.
AK: What can women entrepreneurs do to connect with VCs?
CG: They need to make themselves more visible within the tech world and with VCs, and they can do that by doing much more of what ambitious young male entrepreneurs do, which is, for example, haunt VC blogs daily, comment on posts regularly, and do so in a way that broadcasts what they are doing and what they have to offer. I regularly have to say to women, ‘Why do you say self-promotion like it’s a bad thing?’ Men self-promote all the time, naturally. As women, from the moment we are born, everything sociocultural around us conspires to make us feel insecure about absolutely everything to do with ourselves — including how we come across to other people. We are taught as girls that it is very unattractive to put ourselves forward, to show off. Women entrepreneurs need to get over that, and to make themselves visible in the right places online and offline to get themselves noticed, and to actively ask to make connections.
AK: Do you think that the VC world can be more inclusive? Note: I don’t think that VC world is purposely excluding anyone, but at the same time they are clearly connecting to certain demographics. What can VC folks do to expand their community?
CG: Yes, it most definitely can. I would say to VCs what I say regularly to, for example, the organizers of tech conferences with all-male speaker line-ups. I generally get asked, where can we find great women speakers? I explain that with women both less present and less visible, it’s not about ‘Where can we find them?’ It’s about ‘How can we attract and draw them to us?’ And so you have to put the call out. If VCs genuinely want to find brilliant female entrepreneurs and women-led startups, they need to make it very, very public that they actively welcome women, they need to put it out there every way they can, and they need to meet women halfway. They could also start by employing more women into their own ranks – there are just as few women VCs, as there are VC-funded women-led startups.
AK: Is going out for VC money even the best route for most entrepreneurs?
CG: I think it is if you are a certain kind of entrepreneur with a certain kind of venture. Interestingly, and this is something that the coverage of how few women-led VC-funded startups are out there has highlighted, diversity is a key dynamic for true innovation. Many of the women entrepreneurs I talk to have very interesting, unconventional startup ideas that don’t fit VC templates of ‘what’s the next Twitter/Foursquare?’ I note also that women tend to be more creative when it comes to business models, and to be actually more focused than men on having a business model in place right from the get-go. Possibly because a number of them are entrepreneurs by default, having been laid off from or lost jobs, who have to do something to support themselves and their families and bring in income. (And by the way, when you combine ‘female’ with ‘older,’ you’ve got a real double whammy of VC ‘unfundability’:)
I encourage both male and female entrepreneurs to do their very best to build and put something out there ahead of getting funded, to have something that is real-world-testable which will prove their concept, give them more confidence, and have a much better chance of getting funded. VCs tend to say that they back the person, not the idea. But if they always back the same kind of person — male — then women entrepreneurs have a better chance of getting funded when they have something that’s actually working in the marketplace.
My background is advertising, where David Ogilvy once famously said many years ago, ‘The consumer is not a moron; she is your wife.’ I would say to VCs in a similar vein, ‘The female entrepreneur is not an irrelevance; she is your future.’
Photo: Cindy Gallop in her New York City apartment
Allyson Kapin
Defying the stereotype that the tech world belongs to pocket-protector toting guys hooked on sci-fi and video games, Allyson Kapin founded Women Who Tech to champion ...
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