As we celebrate what seems to be a steady increase in female entrepreneurship in the United States especially over the past few decades, seeking and raising capital remains increasingly difficult for women entrepreneurs.
Pitchbook and the National Venture Capital Association recently came out with their Q3 numbers, which suggest that while overall investment remains robust and resilient even amid the economic volatility brought on by the COVID-19 pandemic, there is a significant decline in the investment in female-founded companies — falling from 2.6 percent in 2019 to 1.8 percent as of September 2020. And as we must, we ask why. More importantly, we ask the women among us in the entrepreneurial shoes about their understanding of the situation.
We recently held our Female Founders Demo Day, a quarterly event that started as an effort to lead by example and raise awareness in an industry that tends to overlook successful women entrepreneurs. The event also included a panel discussion with four remarkable and successful women entrepreneurs who talked about their experiences, successes and failures, as leading women playing multiple and diverse roles within the space. They discussed their opinions on important topics such as what helps investors choose startups to promote, what qualities they look for in the company or in the team, and alternately, what are the factors that help startups choose investors to go after and what makes viable partnerships.
While the panelists agreed that being communicative and expressive about concerns, queries and knowledge gaps, knowing when to seek help, and identifying problem areas are some of the traits that are crucial to a good partnership, they paused at the question of the difference between men and women entrepreneurs when it comes to asking for help.
Lindi Sabloff, co-founder and managing director at Nouva Management LLC, who was also the moderator for the panel discussion, mentioned at the very beginning of the session that there does exist an “unconscious bias” towards women entrepreneurs specifically when it comes to investing. Reiterating that it remains increasingly difficult for women to raise money, she spoke of her own experience as an advisor and mentor to early-stage technology founders.
“Women try to put their heads down and struggle through it and try to appear as though everything is effortless.”
This was also something that all the other panelists appeared to agree on. They confirmed that as female founders, they had personally felt the need to refrain from asking for help and instead try harder to reach the elusive concept of perfection.
Erika Lucas, angel investor and co-founder of StitchCrew, highlighted the same by saying,
“Even though growth and perfection don’t coexist, a lot of women do have the tendency to avoid seeking help when it is needed.”
Nancy McIntyre, Founder and CEO of Fingerprint, said that in her personal experience as a woman executive, she had often felt that “asking for help was a sign of weakness” and therefore faced a hard time expressing the need for help. Interestingly, she also said that while she did find it hard to seek help, she was not sure whether it was something she felt as a female founder-executive or as an individual. She was of the view that showing the “weakness” of seeking help can often lead to self-doubt such as —
“Am I less investible, am I less partnerable?”
Discussing the ways to counter the inability to ask for help, the panelists spoke about their own coping mechanisms. Lindi said that within her career as a mentor, she had had to force herself to get “proactive” and approach female founders to point out to them that while they were brilliant and doing great work, they did need help and advice “from somebody outside their head.” Erika talked about launching VEST, a curated network of C-suite women working together to expedite the pipeline of more women in power, for women entrepreneurs and executives to “bounce ideas and to ask for help” in a safe, non-judgmental environment.
Nancy reaffirmed that forcing oneself to highlight concerns and initiate a conversation in any way that works is the best way to get to a point where one can seek help or guidance that is needed. She said,
“Once it’s out of the bag, it creates a conversation and people want to help.”
Which she felt is easier than directly asking for help. She added that it is important for women executives to find tools that force meaningful conversations.
Going further from the acknowledgment that female founders hesitate to ask for help, Samhita “Sam” Jayanti, founder of Ideamix, said,
“The failure to be expressive or communicative can point toward or lead to a lack of curiosity which is a big impediment to become a successful founder or entrepreneur.”
Sam stressed that it is important to be open about expressing knowledge gaps or problem areas that female founders feel and to work proactively to find out where these gaps exist.
In closing remarks, the panelists agreed that being honest with oneself, forcing necessary conversations, having a strong support group, and not allowing internal doubt and fear of failure take over are crucial elements for women founders to work on as they venture into the market to seek investment. They also spoke about measures such as having regular check-in mechanisms to keep the target in sight, engaging with the teams, and speaking to customers upon every opportunity as pointers that women founders should consider and follow for success.
This brings us straight back to our initial concern — Do Women Entrepreneurs Refrain From Asking for Help? However, like our panelists, we, too, cannot limit our query to a yes or no response to this question. Why do women entrepreneurs feel shy asking for help? Why do they feel the evidently unreasonable pressure to figure things out by themselves even when they need help and guidance? Are there prevalent attitudes in the industry that need to change for this situation to improve? If so, what are they? Does it have to do with continuing prejudices regarding the abilities of women to successfully lead a business? Or are these prejudices only alive now in the minds of the female founders who self-impose the pressure to overcompensate to justify their roles as leaders?
These are questions that need to be understood and answered within the industry so that a more encouraging atmosphere can be created which will be conducive to providing the required help for women entrepreneurs and executives and thus lead to better investment and more success stories. We hope that more such discussions on these issues with both men and women business leaders will give us better insight into what needs to be done to achieve a more egalitarian and encouraging business space.
KiwiTech takes pride in building a startup ecosystem that empowers women, minorities and other underrepresented groups of entrepreneurs. We host a variety of events to help these entrepreneurs close the funding gap – click here to learn more about our upcoming ones!