Could a little more estrogen in the VC mix bode well for women? According to the Center for Women's Business Research, women owned the majority share of 7.7 million firms in U.S. businesses in 2007, employing more than 7.1 million workers and generating $1.1 trillion in sales.
Yet female entrepreneurs received an average of only 4.6 percent of available VC funding between 1997 and 2004, according to the Center.
So how are female entrepreneurs doing today? "Although the percentage of women seeking venture capital money has not greatly increased, the quality and experience of women who lead venture-backed companies is extraordinary," says Jeanne M. Sullivan, general partner of StarVest Partners LP, a VC firm. "They know that competition is keen, and they have to 'run with the bulls'--run fast, run hard."
Marian Sabety spoke with 177 VC firms before accepting $2.5 million in angel funding. She believes being female affected her experiences with the VCs. "I have 25 years' experience successfully doing business in the technology industry, so I'm used to the dynamics of a man's world. I remain mystified, however, that in 177 VC meetings, I only met one woman at the table--and even then, she was mum," says Sabety, president and CEO of Wyndstorm Corp., an online marketing and promotions firm based in Washington, DC. To counter these barriers, Sabety is looking into getting a loan against receivables and using other venture instruments.
StarVest Partners boasts three female general partners, which is an uncommon configuration in Sullivan's industry. While she says her firm looks for "dynamic leadership by men and women," she admits that having females on her team makes an impact. "When a smart, savvy woman CEO presents a company to us, we know there is a connection and a strong interest by that CEO with us as a team," says Sullivan. "Where men may dismiss something outright, we try hard to support that team with another resource, strategic idea or value-add. Maybe that's the 'nurturing' part in being a woman VC."
Although only three of the 24 companies in StarVest's portfolio are led by women, Sullivan says that of the remaining 21 companies, more than half have strong, experienced and creative women behind their male CEOs. Many of these "drivers of the business" will lead their own companies in time, predicts Sullivan.
Looking for more information for and about women entrepreneurs? Check out womenentrepreneur.com.
Aliza Sherman is a web pioneer, e-entrepreneur and author of eight books, including PowerTools for Women in Business. Her work can be found at mediaegg.com.
The Center for Women's Business Research is forming a nationwide research panel of women business owners. The research uncovered from the panel will help shape decisions made by the government, financial institutions and more. Named W-Biz Insight, the panel will include representatives of all types and sizes of businesses. If you own at least 25 percent of your business and you would like to participate, go to cfwbr.org for details.