Twelve Years of Investing in Women

By Joanne Wilson, Gotham Gal

Photo Credit: David Johnson

I began investing in women over a decade ago. It was a major part of my investing thesis. Why? Twelve years doesn’t seem like a lot of time but in the world of technology it was a long, long time ago.

People Just Weren’t Listening

Through my blog, Gotham Gal, I started to talk to founders—often women—who were having a hard time raising capital, or even getting anyone on the other side of the table to understand the opportunity in their business or, more to the point, connect with them. I heard from women with amazing companies that would help women, and from women with simply great companies… yet I heard from them, over and over, that people just weren’t listening.  

I listened. And I invested.

Photo Credit: ITP NYU, The 5th Annual Women Entrepreneurs Festival

I invested in businesses that I believed had a huge opportunity that could grow to be worth $100M or more. Of course, sometimes what I see others don’t—but nobody at that time was talking to these women.

This was the reason I started the Women’s Entrepreneur Festival with Nancy Hechinger at ITP/NYU. It was the reason I began writing a piece every Monday called the Women Entrepreneur of the Week, and then evolved that Monday piece into a podcast where I get the opportunity to speak to women founders, and I could make sure that plenty of people could really hear their voices, their passion, and their entrepreneurial brilliance.

On that podcast, I recently spoke with Nadia Boujarwah, Co-founder of Dia & Co, a shopping and styling resource for plus-sized fashion. Nadia spoke to me about the countless times that she tried to explain to (male) audiences the huge potential market—according to her, more than 60% of American women fit size 12 or above—and the importance of style to this growing segment of the population. Over and over, she was turned down. They didn’t get it. But she continued to persevere and prove that model, and just last fall Dia & Co raised a $40 million Series C.

I want to believe that smart businesses with big opportunities will always find investors. But if too few investors are really listening to women entrepreneurs, then inevitably, some potentially great businesses are going to fail for lack of capital. It’s bad business to discount half the population for reasons that have nothing to do with business.

Just Do It

This is what I tell every woman founder I know who is in a relationship or married and who wants to have children: just do it and do it now.

I sit on the board of a company whose founder took that advice and got pregnant. She told me first, before letting the board or even the company know. She had planned everything around how long she would be out, how the company would be managed during this time, the whole shebang. I told her do not do that.

My advice: Just simply tell them you’re pregnant, this is your due date, how excited you are, and that’s it. No need to micromanage your pregnancy for the company. This is life. It will play itself out just fine. After all, men don’t go to these lengths when they have children, so why should women have to come up with all these excuses and strategies?

She took my advice, the board said congrats, we moved on with the meeting, and the same thing happened when she told the company. She went on to have a second child as well. Guess what? The company is doing just fine.  

I have invested in many founders who have had children while building their companies, and guess what? They become even better leaders and managers. But none of this is shocking to me, and that is the reason I have done all of this.

Diversity Works—And So Do Women Entrepreneurs

I am not being philanthropic when I help women entrepreneurs to rise up. I believed that I would make a solid return on every single woman I invested in.

I am thrilled that many institutional investors have begun to see the light: making a full-on commitment to investing in more women, bringing on more women partners, and pushing companies to have more diversity. It doesn’t take a rocket scientist to google “diversity + business” and see the slew of articles around better ROI, better cultures, happier workers, and more to understand that diversity works and so do women entrepreneurs.

What is most amazing to me about women founders is their survivor mentality. I am invested in some women who are building their businesses with very little capital because they are profitable and are in it for the long-haul. I have invested in others that are starting to hit their stride, and although they were not at a valuation of $90M in two years, they were there in six. It takes time to build a solid business, and I applaud every founder who has the constitution to plow forward against all odds. I see that tenacity in women founders. I also see and admire their transparency and honesty with their investors.

Perhaps it is because I am not a VC but an angel investor, who sits in the unique position of being a consigliori to each of the founders I invest in, but they all ask questions and are honest about the good and bad things happening in the company. I have seen women founders speak up at board meetings and say that something is not working, rather pretending that everything is fine. In fact, time and time again, at the start of a business women tend to be so honest and forthright about their model and numbers that they come across as demure.

Yet I can name ten women founders—if not more—who as their business starts to grow and they surpass that Series A take on a totally different persona of power. They have learned that they own it and that they get their business better than anyone else at the table. I had one founder turn down capital from a top VC because she knew that they did not truly get her business—all they saw were the numbers, and those are very different things. It was a bold move, but in the end, she trusted her gut and figured out how to make it work with the right set of investors, who might not be name brands but understood the cadence of her business.  

Diversity: A Non-Negotiable Term

ITP NYU, The 5th Annual Women Entrepreneurs Festival

I have invested in men, too, but they are all committed to diversity because they believe in it and understand how it makes them better founders. If every investor would make it a non-negotiable term that the companies they invest in must make diversity a priority, the results would be huge. It might not be easy to do, but it can be done. Many of the companies I have invested in have done it.

We shouldn’t be looking at changing the ratio of women entrepreneurs because it is a buzzword of this moment, or because it looks good—but because financially, it works.

Maybe this is the moment when incremental change tips into transformation, and everyone starts listening to women entrepreneurs. I hope so. I’ll still have plenty of investment opportunities: there are enough great women entrepreneurs to go around. And there will be still more if investors start paying attention to them.    

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