Should Women Be Insulted by Gender Lens Investing?

As we saw at our Impact in Angel Investor Decisions event recently, it seems as if every angel investing event I attend invokes a conversation about the need to support female entrepreneurs. In the past week, four people have asked me what they can do to help women entrepreneurs and angel investors. While these offers for support are certainly well-intentioned, I’m starting to wonder whether I should be insulted by this overwhelming urge to provide extra support to women through gender lens investing.

Of the 10 investments made by the Impact Angel Group last year, four of them are led by female CEOs (Erika Trautman, Karen Bradley, Willow King, Sherisse Hawkins) and one was co-founded by a woman (Kati Bicknell).

Of the seven companies in due diligence with the Impact Angel Group, three are led by women.

And if I were to make a list of the most productive members of our Boulder startup community whom I most admire, Sheila Lamont, Nicole Glaros, Sarah Schupp, Kelly Burton, Joni Kripal, Sue Heilbronner, Colleen Kazemi, Nicole Gravagna, Sara Rodríguez López and Claudia Batten would be at the top of my list.

I did not invest in, nor do I admire these women because I apply a gender lens to my work. Rather, I like to invest in exceptional entrepreneurs and work with exceptional people, and these women are EXCEPTIONAL. Additionally, I would venture to guess that these women would be horrified if an investment in them was viewed as a charitable rather than a financial decision. I know I would be.

As Sharon Vosmek from Astia, an organization that supports female entrepreneurs, always reminds me, women-led startups are statistically more likely to succeed. People should invest in women not because they want to level the playing field, but because they want to increase their likelihood for angel investment success.

So…..should women be insulted by gender lens investing? If the investor’s intention is to increase their odds for a return, then obviously not, but if the investor is trying to charitably help women because they think women can’t compete, then perhaps we should be.

If you are wondering how to help women entrepreneurs and angel investors, here is my advice:

  1. Invest in and surround yourself with exceptional people. If you diligently seek exceptional people to invest in and work with, I guarantee many of them will be women.
  2. Consider the generational and cultural differences. Thanks to the hard work of the generations before me, I, as someone born in the Midwestern United States in 1981, the first year of the Millennial Generation, grew up thinking that I could do everything my brother could do and for the most part, experienced equal opportunity. For those of us who have enjoyed equal opportunity, extra support may be counterproductive.
  3. Invest in women because it is an opportunity rather than an obligation. As I mentioned, companies with female executives are statistically more likely to succeed. Additionally, although I have enjoyed equal treatment, it has been much harder for women of previous generations and different cultures to rise to the top. Those women have overcome adversity and may be stronger and brighter than those who haven’t.
  4. Women, get out there! If you are an exceptional female entrepreneur or angel investor, make yourself known and lead by example. Speak on all-male panels, blog about your experience and always remember that right or wrong, your behavior will either perpetuate or break the female stereotype. You are an ambassador for women everywhere.

While I certainly meet fewer female entrepreneurs and angel investors, I can say that the number of exceptional entrepreneurs and angel investors I meet is more or less 50/50. Perhaps this is because most women are from pre-Millennial generations and are stronger for having to overcome gender adversity, or maybe it’s just a coincidence. Regardless, I can emphatically say that investing in and working with women is opportunity, not philanthropy.

What do you think?

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6 Responses to Should Women Be Insulted by Gender Lens Investing?

  1. Well said, Elizabeth. I agree, and will use this column as the starting point for discussion with a group of women business owners in tech companies this coming week while I’m in Denver on a quick break from my tasks in Myanmar.

    We’re starting two programs for women entrepreneurs in Yangon, Myanmar next month: one for the “emerging” entrepreneur, and another for the “accelerating” entrepreneur. From the interactions so far with women entrepreneurs inside Myanmar, the challenges seem similar to those in the US, but I hope to learn more from these two groups as we go along.

    I appreciate getting your columns and the thoughtful reflections and insights. Keep them coming.

    Barbara T. Bauer
    Executive Officer, Myanmar
    Partnership for Change
    US: 1.303.333.9439
    Myanmar: 09 250 048 568
    Skype: btbauer1

  2. Jacki Zehner says:

    Oh my gosh NO NO NO do not be insulted. This is an awesome thing! Many studies have documented that in general and historically women have a harder time raising capital. Many other studies also point out the fact that this makes no sense!!!!! In fact, as you point out, the opposite may be true. Be GRATEFUL for the attention and the focus and the whole ‘gender lens investing’ thing means more talented and deserving women get funding, awesome! Seriously awesome.

  3. Amy Divine says:

    Elizabeth, I’m impressed with your standards re: working with exceptional people and impressed that this has led you to near gender balance in your investments. This reflects a belief that I share, that there are both exceptional men and exceptional women creating businesses.

    That said, you seem to be unusual in ferreting this out. In 2013, only 4 – 9% of venture funding went to women led businesses, despite women creating businesses at 1.5 times the rate of men. While there are many explanations for this disparity, it would be hard to argue that, at this time, women (even exceptional women) have equal access to capital.

    I am pleased that you feel that you have equal opportunity. I think that we are in a time when many exceptional women can create excellent opportunities. But I don’t think we are yet in a time when exceptional women are as likely to receive capital as exceptional men – or when unexceptional women are as likely to prosper as unexceptional men. Yes, I do want to level the playing field so that people of equal talents and prospects can receive equal access to capital.

    This is what gender lens investing is about. It is not about “charity” or “philanthropy”. It is not about funding mediocre female entrepreneurs over exceptional male entrepreneurs. It is about looking at the numbers above, amid other numbers (such as the studies you reference about female success), and asking how we can help bring talented and investable people out of the shadows and into the light, for the benefit of us all.

    • Elizabeth Kraus says:

      Excellent insight Amy! And very good to hear from you. Re: In 2013, only 4 – 9% of venture funding went to women led businesses, despite women creating businesses at 1.5 times the rate of men. I’d love to know whether this is mostly an issue of women being turned down for funding vs. women just not asking for funding. Also, I’m hoping that the more equal gender diversity that we are seeing is a sign that the tables are turning. So glad that there are people like you trying to move the needle!

  4. sue says:

    E. I’m increasingly thinking that it is exactly the lack of asking, the lack of seeking, the assiduous adherence to the “rules” of things like applying for accelerators. Not pursuing or attempting to push or get leverage or use inside connections or be “annoying” or “too much.” I’m not suggesting that doing these things is “right” or “wrong”, just that in a land where these things do happen (I see this ALL the time when I’m hiring and experience the difference in push b/t men and women — it blows my mind that anyone applying for a job on Linked In calls my cell phone — which requires a lot of investigation — and it’s men who do it and things like it exclusively), it’s a disadvantage to not be doing these things.

    thanks for the thoughts.

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