Being a woman in the overwhelmingly masculine world of venture capital was still an obstacle – but like many other female entrepreneurs, she only worked harder to succeed.
“In some cases, before I even spoke, they asked me if I would leave as CEO,” Foundos said of meetings with venture capitalists.
“This was a whole new level.”
Men talked past her at meetings and discussed whether she could emotionally handle the job as if she were not there or wondered aloud who would take care of the books.
“When it happens, I tell them I’m here,” Foundos said. “I’m the economist. I’ve worked in big banks for more than ten years. I’ve been the best at everything I’ve ever been into.”
Startups can only manage as long as they rely on friends, family or savings before they eventually need to find investors who are willing to invest in young companies in exchange for a stake in the business.
Money invested in start-ups in the earliest days, perhaps when they are nothing more than ideas or prototypes, is called “seed” financing.
When it comes to getting support for a start, it’s about trust, and it seems to be lacking when it comes to women entrepreneurs, according to Foundos and other interviewees by AFP.
“I do not think women need to get things done,” Foundos said of venture capital. “But I think they do not see the same amount of offers.”
Forte has grown rapidly as the pandemic has gyms and fitness centers that climb to offer members online sessions.
Foundos took a “right hand”, a male partner with a British accent, to give potential investors a more traditional face and increase the odds of getting funding.
She has chosen to ask venture capitalists she meets if they have invested in women-run companies in the past, and the answer has always been “no”.
Sex for funding?
Few percent of the venture capital money goes to women-driven startups in the United States, according to Allyson Kapin, General Partner at the W Fund and founder of Women Who Tech (WWT).
Being sexually forbidden in exchange for funding, or even an introduction to venture capitalists, is common for female founders of start-ups, according to a recent WWT survey.
About 44% of the female founders surveyed reported harassment as sexual acts or unwanted physical contact when applying for funding.
And while last year set records for venture capital financing, support for women-run start-ups drew despite reports that such companies actually provide better returns on investment, according to Kapin.
“This is not about altruism or charity, it’s about making (a lot of) money,” Kapin said of supporting new women.
The prospects for funding are becoming even more bleak for women of color.
The black entrepreneur Fonta Gilliam worked abroad with financial institutions for the US State Department before creating the social bank start Invest Sou Sou.
Gilliam took the idea of the village’s savings circles that she had seen flourishing in places like Africa and built it into a free mobile app that adds artificial intelligence and collaborates with financial institutions.
She created a Sou Sou prototype and started raising revenue to show that it could make money, but still found it harder to get funding than male peers.
“We always have to overperform and overcompensate,” Gilliam said. “Where startups run by men would be believed, we would have to prove it ten times.”
Gilliam received insultingly low values for her start, some so prey that she left.
“We’re still skinny and mean bootstrapping, but I think it’s going to pay off in the end,” Gilliam said.
“One thing about women-owned, black-owned start-ups: because there is such a high bar for support, our companies tend to be scarier, stronger and more resilient.”
Women-led start-ups tend to be on the outside of the “pipeline” that unofficially leads entrepreneurs to venture capitalists, according to Kapin and others.
In Silicon Valley, that channel is open to male, white technology entrepreneurs from select universities such as Stanford.
“The pipeline is filled with people from the same university; from similar backgrounds,” says Kapin.
“It’s not representative of the world, which is problematic because you’re trying to solve the world’s problems through very few people – mostly white men.”
Investors vying for gemstones in the frothy tech start-up scrum are missing out on a wealth of returns and stability by investing in neglected female founders, according to Caroline Lewis, a senior partner at Rogue Women’s Fund, who does just that.
“At the end of the day, it’s right to do and it’s good to do,” Lewis said.
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