From gender discrimination at pitch stage to investing in female founders, join us as we find out how investors can #ChooseToChallenge when funding female-founded businesses with Bérénice Magistretti.
This year’s International Women’s Day theme is ‘choose to challenge' gender bias. Women are statistically likely to raise less funds than male-led startups. Why do you think this is - and as an Angel Investor, do you actively look for female-founded brands to invest in?
I think this year’s theme for International Women’s Day is extremely timely as you have to be intentional about change. Therefore, challenging gender bias is a proactive choice and is one that more people need to make. When you learn that less than 3% of venture capital money goes to female-founded businesses, you know there is a systemic flaw in the world of tech. We need more diverse LPs (limited partners) and more diverse VCs to allocate funding to more diverse founders. I am personally very intentional about only backing female-founded companies as an angel investor – there needs to be at least one female co-founder or I won’t look at the deal. That’s why I love Alma Angels so much as their core mission is to level the playing field for female entrepreneurs seeking early-stage capital. I joined the community last year and have been blown away by the quantity and quality of deals shared. Therefore the general notion that the funding gap is due to a pipeline problem is completely flawed. The deal flow is there.
Have you experienced gender discrimination during your business journey - and if so, how did you tackle it?
I personally haven’t faced any gender discrimination throughout my career and was very fortunate to have supportive male mentors. I have, however, witnessed and written about it as a journalist. It has been proven that it is much harder for female founders to raise capital as they face biased questions and behaviour from the start. A study from 2017 that was published in the Harvard Business Review found that women are asked different questions than men when pitching to VCs. While men are generally asked more ‘promotion’ questions (highlighting upside and potential gains), women are usually asked ‘preventive’ questions (highlighting potential losses and risk mitigation). So if women face gender discrimination at the pitch stage, then it’s no wonder they receive less funding as there is an inherent bias from the start.
“Women are significantly underrepresented in entrepreneurship. It is said that up to £250 billion of new value could be added to the UK economy if women started and scaled new businesses at the same rate as UK men.”* What is your key piece of advice to women looking to start their business in 2021?
I would say, “Go for it!” The UK is a very supportive ecosystem for women, in my opinion. I’ve been fortunate enough to meet and collaborate with some outstanding female VCs, including Maren Bannon of January Ventures, June Angelides of Samos, Pippa Lamb of Sweet Capital and Deepali Nangia of Speedinvest (she is also a co-founder of Alma Angels). These women are so bullish about female founders, which shows through their work and initiatives. I would advise female entrepreneurs to reach out to them or find other potential female mentors who are just as supportive. There are also a lot of angel investors, like me, who are intentional about investing in female founders – so find your angels!
We’re proud to have you on board as an investor in HANX. What makes sexual wellness an investible prospect in your eyes?
I am so thrilled to be an investor in HANX – finally a line of sexual wellness products that is designed by and for women! When I spoke to Farah, one of the co-founders of HANX, I was very surprised to learn that 40% of condom purchases are made by women, yet none of the legacy condom brands thought about targeting female customers. I think there has been a real boom in sexual wellness lately, especially with the pandemic forcing people into lockdown. It has given us all time to explore our sexuality more mindfully, either alone or with a partner. Thanks to sexual wellness apps like Ferly and Kama, sexual pleasure is being normalised and recognised as an increasingly important part of our health. I therefore think that sexual wellness is a very lucrative investment opportunity that more investors should be looking at.
Bérénice Magistretti is a writer, startup advisor and angel investor.