Every day we hear about incredible improvements in the financial status of women. More and more women are the primary breadwinner in their household (almost 40%). Women-owned businesses are growing at twice the rate of all U.S. companies. A new survey by GfK Roper for NBC Universal stated that 65% of the women reported being their family's chief financial planner, and 71% called themselves the family accountant. The numbers look good. In fact, better than good. Women today control more wealth than ever in history. But there is still an important area lacking - women's access to big business funding. Venture Capital.
Amanda Steinberg, Founder of DailyWorth, a free daily personal finance email for women, has been trying to raise capital for her venture. What's missing? ... Women. "I'm raising seed capital for DailyWorth ... I'm fortunate to have a few worthy men stepping forward to explore angel investments. WHERE ARE THE WOMEN??!!" she recently ranted on her company's Facebook page.
Erin Abrams, a lawyer who writes for The Glass Hammer, an online community designed for women executives, may have some answers: "In 2006, only 4% of VC-backed companies had female chief executives, and those companies with women as leaders received just 3% of the total dollars raised from VC," writes Erin in her article "Women in Venture Capital."
The fact is the VC world is still a place dominated by men. At the National Venture Capital Association's annual conference in May 2008, VC financier John Doerr acknowledged that VCs still primarily invest in "white male nerds who've dropped out of Harvard or Stanford."
Nothing is wrong with white male nerd dropouts, but how can women get in on the game? What's stopping them?
Lotta Alsen, creator of The Heroine's Journey, a course designed exclusively for women entrepreneurs, points out in an article on The Huffington Post: "Women don't start companies for the same reason men do. Women start businesses as an expression of themselves, as a way to balance family and work, and to be able to be their own bosses. Men start businesses to make money, or because they have an idea (that they believe they can make money on)."
If so, will the plethora of women's businesses that have launched recently be sustainable? And what about the women who want to have a big, positive impact on the world through their business? Will they be able to scale their business large enough to make enough profit to not only survive, but prosper?
There is some good news.
Some Venture Capital funds seek to invest primarily in women-led businesses. One example is Fund Isabella based in Cincinnati, Ohio. The Fund's founder is Peg Wyant and focuses on early stage, fast-growth businesses (annual growth at least 25%).
Can a woman grow a really big, world-changing business if she doesn't have big investors in on the plan? And if she needs them, where else can she find them?
I think there needs to be more women-run VC funds that focus specifically on women's businesses - just to get things started.
Tabby Biddle is a writer and editor specializing in helping women entrepreneurs and emerging authors get their message out. Additionally she is the founder of Lotus Blossom Style, a yoga lifestyle company created to support women in their personal transformation. She lives in Santa Monica, CA