The bubble may have burst, but there's a new wave of business owners seeking money for the "next big thing." What are they finding?
Three women who've been there reveal what the financing atmosphere is like for women business owners these days.
Jerusha Stewart, 34, founded iSpiritus Soul Spa, an online and offline store selling personal growth and well-being products, in 1999. She's seeking her first round of funding to open stores nationwide. Projected 2002 sales: $1.2 million.
THE FUNDING CLIMATE: "There's more focus on understanding what business you're in and whether it has 'legs,' as they say in Hollywood. As a company, we're more focused on attracting investors in sync with our values and goals vs. trying to get meetings with the 'Go, go, get big fast' types of the past. We've also noticed that interested investors are spending more time [getting] to know us and our company."
THE GENDER PICTURE: "Being a female fund-seeker is a curse and a blessing. On the one hand, you're likely to stand out. On the other hand, they're going to comment on your hair, nails, dress-sometimes everything but your plan. VCs even refer to the funding process as dating. Getting a meeting is the 'first date,' where you should wow them but keep a little mystery, so they'll come back for more. The good news is, you'll get their attention. The bad news is, you may have a harder time keeping it focused on the ball you're pitching."
ADVICE: "The fund-raising game is a marathon, not a sprint. Every day we walk through a graveyard littered with companies that raised millions of dollars but weren't built to last. Building a company that makes a difference takes time and depth of mission. If you don't pace yourself, you won't last."
Gloria Kolb, 30, is president of Fossa Medical, a Boston company that makes medical devices. She has already landed one round of angel funding. Projected 2002 sales: $20,000.
THE FUNDING CLIMATE: "The funding climate is better, especially for the sector I'm in. Last year was fairly non-committal, but more VCs are looking to get into health companies. Health is a constant amid the fluctuations of the economy."
THE GENDER PICTURE: "I face more skepticism. But that's all right, for as soon as I start the presentation, I have everything to gain. There is more pressure, but often more reward as well."
ADVICE: "Go into a presentation prepared for the questions they will ask and the holes they will find. Be confident. It's OK to say you need to look into an issue, but don't come off as wishy-washy. They need to see you in a leadership position."
Amy Millman is president of Springboard Enterprises, a Washington, DC-based nonprofit that promotes the growth of entrepreneurship and capital acquisition among women entrepreneurs.
THE FUNDING CLIMATE: "If you are an entrepreneur, it is always the right time to launch a business. There is great opportunity [if you] focus on the fundamentals. Remember, there is no free lunch."
THE GENDER PICTURE: "People opt to do business or spend time with people who look and act [like them] and have similar experiences. When women make up 50 percent of the investors, we will probably see a commensurate number of women getting funded."
ADVICE: "Present your value proposition concisely, accurately assess the market size, know your competition, and [show that] your management team is well-positioned to grow the company, you have a sound business model and you have a command of your financials. These are the fundamentals of any business, and if you nail this, funding comes."
Aliza Pilar Sherman is an Internet pioneer, netpreneur, speaker and author of the book PowerTools for Women in Business: 10 Ways to Succeed in Life and Work.
- Fossa Medical
(617) 275-7480, http://www.fossamedical.com
- iSpiritus Soul Spa
(510) 465-5400, http://www.ispiritus.com
- Springboard Enterprises
(202) 242-6280, http://www.springboardenterprises.org