Female founders often find it tougher than their male counterparts to win venture capital backing, but there are strategies that can help, according to five successful women entrepreneurs in the Tampa Bay area.
They shared their secrets for success during a panel discussion at the Synapse Summit last week, just ahead of a new study released Monday that showed funding for women-owned or run firms stalled in 2018.
All female founders combined raised $2.88 billion last year, according to PitchBook and All Raise, an organization supporting women in venture capital and startups. That was the exact same percentage as in 2017, Fortune reported, and $10 billion less in funding than Juul, an e-cigarette company, took in by itself.
“Studies have found that venture capitalists ask women and men entrepreneurs different types of questions,” said Julia MacGregor-Peralta, CEO of Global Safety Management, a software company in Tampa that has raised more than $3 million in funding. “They will ask a man questions about growth and the future and they will ask women questions about risk. That impacts their ability to raise money and how much money they end up raising.”
It doesn’t matter if the venture capitalist question is a man or a woman. They take the same approach in questioning, she said.
“There are strategies that as women we can use to turn a risk question around to a growth question, but first we have to be aware of it,” MacGregor-Peralta said.
Anne Zink, CEO of 5×5 Technologies Inc., a drone support company in St. Petersburg that raised $4.4 million from SoftBank last year, said the scene is set early on in meeting with VC’s. She credited Dr. Joan Fallon, CEO of Curemark and an EY Entrepreneur of the Year in 2017, with giving her invaluable advice when Fallon told Zink not to bring anyone else to the meeting.
“Make it so you are who they have to deal with, the one they have to have all the conversations with,” Zink said.
Zink also said it’s important to know every detail intimately.
“Own the whole conversation, from the risk conversation to the ownership conversation, and also be thoroughly prepared to have the finance conversation,” she said. “One of the predispositions about women entrepreneurs is they can’t get in deep to the finance conversation. If you can’t have those margin conversations, those projection conversations, if you can’t talk about market size and addressable market and how you are going to own those, and what’s the risk and what’s your risk mitigation strategy against how that market changes – if you can’t have that to the Nth degree of detail, you can’t be credible.”
Eve Barrett, president and founder of Expedite, takes a different approach. She previously was in the military and worked as a court reporter herself before founding the Dunedin company, with a platform that connects attorneys with court reporters and other legal service providers on demand. In 2010, she decided she wanted to take part in Ironman events, and while she could run, she wasn’t as practiced in swimming and biking, but she studied and trained for those parts of the competition.
She brings that style to her dealings with investors.
“When I’m looking for investors I tell them, I may not know all this, but I’m learning so much. I’ve learned a lot and I’m willing to learn more. If you could put your faith in me I will learn it,” Barrett said. “Don’t be scared. If you don’t know something just research it … Just get out there and do it. Howard Schultz from Starbucks had 243 no’s before somebody said I think you’re on to something. Don’t let that hold you back, and don’t let fear be a factor.”
Preparation and resiliency are key for Brooke Evans, CEO of CFO Alliance, an outsourced CFO and professional consulting firm in Tampa. While she’s active in the male-dominated world of finance, she found opportunity in being a woman.
“It took me a few months to realize I have to succeed in this male-dominated profession to help other women succeed, so it became part of a calling,” Evans said.
It is hard work, said Robyn Spoto, who moderated the panel and is founder of SpotOn Digital Media. Spoto formerly headed MamaBear App, which sold in 2016 to Grom Social. Her advice: “Do the hard work it takes. Be prepared, change questions from prevention questions to promotion questions. Promote your business. It’s not about male or female when it comes to those things.”