Startups are not too hard for women. Women just have to work way harder to create a startup.
In the midst of my life as a fundraising CEO, I am going to posit one thing: That the ramen-eating, asocial women entrepreneurs have it harder in starting a VC-backed company because VC funding is harder for women.
A recent op-ed written by Penelope Trunk and published in VentureBeat suggested that women aren’t cut out for entrepreneurship because they are too distracted by childbearing and the desire for “a good house, good clothes and a cushion for emergencies.”
But Trunk overlooked the fact that women are great at management and leadership, and they’re great at the most important aspects of building a new business.
Why women have a hard time as entrepreneurs
A CEO’s job is in a state of perpetual dynamism. In the beginning, you have to have a great idea and to use your impeccable market sense to finesse it into the first version of a business. Then, you have to find the right people, to sell your dream to build a great team, to nurture that team to do great things, and to find partners and customers to evolve your business. In all these tasks, women excel.
If you doubt this, just look at how many more small business owners who are women than men. According to statistics from the White House, women are starting new companies at a rate 1.5 times higher than the national average.
Speaking for my fellow female entrepreneurs, we generally don’t feel more troubled for working just as hard as our male counterparts. We generally don’t feel sad that we can’t afford some things.
Entrepreneurs are rare, but all entrepreneurs, men and women, have these values.
Women as a group don’t have a hard time doing startups because of the tasks involved. It’s not the type of work, the amount of work or the low financial returns in the beginning.
Yes, many women have to overcome more barriers to achieve their entrepreneurial goals — as Trunk said, there is an extra burden (and extra joy) in tending to a family and making a home. But that excuse, in addition to being unrealistically old-fashioned, misses the crux of why startup life is more difficult for a woman.
Here’s the truth: Getting funding, the very backbone of almost every company, is harder for women.
The funding question
At the beginning of building a great company, there’s institutional funding. For a lot of entrepreneurs, funding helps the company accelerate so that the team can keep on doing what it’s great at.
While almost every entrepreneur will tell you his or her least favorite part of the job is canvassing for funding, I will argue that VC funding gives women much more grief than men.
In order to be a good fundraiser — like every good male CEO is — we as women seem to have to overcompensate and overcome and do what is contrary to our very sociologically ingrained nature. Many of my female CEO friends and I thoroughly enjoy what we do, but we agonize over fundraising more than over any other stress of running a company.
Women aren’t as good and don’t like fundraising because the current mode of fundraising is built by men and for men. Most of the characteristics that are best for fundraising are especially aligned with typically male characteristics — characteristics like asking for what we want without apology or projecting confidence bordering on arrogance.
I’ve had to fundraise now two times. I get trained by my mentors, almost all of them great entrepreneurial men, to be tougher, more aggressive, more invincible — more like them — when I fundraise. And it’s been a great help, because it’s not natural to me. So I have been pushed and pep talked and encouraged by these men so I can be half as good as they are at it.
But no man gives me that same advice when I’m building partnerships that create revenue and marketing opportunities for my company or when I think about product and market fit. The traits I have are more “feminine” qualities of leadership: teambuilding, partnership building, thoughtful management, market savvy.
So, like many female entrepreneurs and CEOs, I’m amazing at my job until it’s time to raise money.
Women’s disadvantage in emotionally connecting with VCs
Much of business involves emotionally connecting with your audience. That’s why women build companies that emotionally connect with consumers: Much of consumerism is driven by women.
But the “audience” when you’re raising a round of VC funding is, well, men. Women can’t possibly emotionally connect with men as well as other men can. That’s probably why female VCs fund women-led companies more.
If the VC and angel communities could achieve more gender balance, I think you’d see more female-led companies being VC funded.
Women and risk
The financial drivers that make for a great VC-backed company are very different from the financial drivers for non-VC backed companies. VCs need to look for companies that swing for the fences and make it or break it in four years, creating a bias favoring companies that have a binary end result: go big or go home.
Based on my own experience, I do think women are more risk averse, so I’m not surprised that there are fewer women founding VC-backed companies. In a sense, that’s ok. We don’t necessarily need an exactly equal number of male- and female-led VC backed companies. But…
Bridging the gender gap
Society can and should do a better job of encouraging women who want to be risk-takers to follow their dreams.
It’s a Silicon Valley societal norm for a 22-year old guy coder to want to be like Zuckerberg. It’s a Silicon Valley societal norm to have amazing male VCs.
But there’s no such norm yet for women. And until there is, I applaud organizations like Women 2.0 and Golden Seeds and female heav(ier) VC firms like Kleiner Perkins in promoting an ecosystem dedicated for, and built by, women… and men.
Julia Hu is the founder of Lark, the makers of the silent alarm clock, sleep tracker, and personal sleep coach. Prior to co- founding LARK, Julia ran global startup incubator Clean Tech Open, marketing for d.Light in China, and green real estate development for Mogavero Notestine. She received her Master and Bachelor degrees at Stanford in Engineering and design thinking, and half an MBA from MIT Sloan.