Jaclynn (Jax) Brennan is the CEO of the private membership mastermind for female entrepreneurs Phili. Known as a NaAs company.
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Less than 2.5% female entrepreneurs receive venture capital, and less than 1% of it goes to women of color. Women of color are responsible for only 4% of C-suite leaders, and the difference in burnout between women and men has almost doubled. On top of that, 48% female entrepreneurs feel their professional growth is hampered by a lack of advisors and mentors.
The real decoupling is here in the data. Studies show that private technology companies led by women are “more capital efficient, Achieving a 35% higher return on investmentand when backed by venture capital, they earn 12% more revenue than male-owned tech companies.” In a study of more than 350 startups, Mass Challenge and BCG found that “companies founded by women end up generating higher revenues – more than twice as much per dollar invested – than companies founded by men, making women-owned companies better investments for lenders. “
Despite the serious funding gap, the BCG study found that “startups founded and co-founded by women outperformed over time, generating 10% more cumulative revenue over a five-year period.” But if women have proven to quit a year faster and triple their earnings at a higher rate, why are they also struggling to get funding? And how do we continue to support the advancement of women and the next generation of female entrepreneurs?
I believe the answer boils down to three specific actions: women investing in women, becoming mentors and joining a local community of other women leaders.
1. Invest in women-owned and operated businesses.
The only way we can break the cycle is by investing in other women. There are now many great resources for it, known as special purpose vehicles (SPV), allowing a group of investors to come together for a particular “buy-in” as a group.
There are also many fantastic venture capital funds that are always looking for female Limited Partners (LPS) and will guide you as you decide what to invest in, how to invest and how to create wealth. Here are some funds that prioritize investing in women and minority businesses: iFund Women, The Fearless Fund, Misfit Ventures, Dream Ventures, Lockstep Ventures, Capital Factory, and The Artemis Fund.
2. Become a mentor or advisor to an aspiring entrepreneur.
Established entrepreneurs who want to invest in women do not necessarily have to make a monetary investment. Investing your time as a mentor or advisor to aspiring female founders and helping lead them to success can be just as valuable. This leads me to…
3. Find your tribe and local girl gang.
Whether you join a local community organization, a mastermind group, a club, or anything else that feels right you, go out and start connecting with other women who feel aligned with your personal values or mission. Being an entrepreneur is extremely difficult and can feel lonely and daunting at times. Having a tribe of sisterhood that surrounds you with encouragement, positivity, and cooperation not only makes the journey more enjoyable, but also helps you reach your goals faster and more efficiently.
If you can’t find a community or group that feels right for you, then I encourage you to go there and start your own circle. Here are some great communities supporting women entrepreneurs on their journey: Chief, Luminary, and Renegades Global, as well as Black Women Talk Tech, The Riveter, and The Female Quotient. (Full disclosure: My company and these three are community partners but have no financial relationship.)
Let’s keep encouraging each other! How can women continue to progress if we don’t support each other in a joint effort? For generations things have been done differently, but now it’s time to see women flourish. Give another woman a boost by coming to her events, reading her articles on LinkedIn, participating in social media, and being a cheerleader on a global level. Most importantly, lend your time and roadmap to women who are nothing like you and may not have had the same opportunities as you in your life.
The information provided here is not investment, tax or financial advice. You should consult a licensed professional for advice on your specific situation.
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