By Emily Glazer (Writer, Wall Street Journal)
Women represent just over 15% of angel investors, and only 5% to 7% of partners at high-tech VC investor firms in the U.S., according to a recent study by Illuminate Ventures, an early-stage venture firm.
In August 2009, designer Alexa Andrzejewski, who focuses on product strategy, research and design, attended a Women 2.0 workshop aimed at helping women to launch a start-up. She initially wanted to create a cookbook, but came out of the eight-week mentoring program thinking it would be better to build an app for Apple Inc.’s iPhone that served as a field guide for food. By the workshop’s finale, she landed $5,000.
The feedback and money she gained from other women founders gave her confidence to start her own company. In January 2010, Alexa co-founded Foodspotting, an online service that lets people snap photos of their favorite food dishes and share their location with fellow foodies. That May, she quit her consulting job, and two months later the company received $750,000 in funding from a group of angel investors and well-known early stage investors such as Felicis Ventures, High Line Venture Partners and 500 Startups.
“I realized people like me can make these ideas real,” said Alexa, 27. “Go into a traditional [venture-capital firm]…they’re looking at you like ‘This is cute, a girl wants to start this food start-up.'”
Alexa is one of about 35,000 women involved in Women 2.0, a group for female entrepreneurs founded in San Francisco in 2006. Shaherose Charania, chief executive of Women 2.0, estimated 50% of those women are aspiring entrepreneurs, 30% are current entrepreneurs and 20% are would-be investors. The group runs programs such as networking events in several cities, and an annual start-up competition. In June 2010, it began an incubator program in San Francisco, and this May it opened one in New York.
Still, many women say that venture capitalists, a male-dominated group that can make or break a company, often don’t understand the reason for some female-founded start-ups.
In June 2010, Julia Hu dropped out of the M.B.A. program at the Massachusetts Institute of Technology to start Lark, a company that makes a sleep sensor and silent alarm clock. Julia, now 26, got the idea after getting tired of being woken by her boyfriend’s alarm clock that went off at 5 a.m.
In meetings with potential investors in the fall of that year, she cited research explaining that women are more sensitive to high-pitch frequency noises and cannot fall asleep after hearing them. But male financiers didn’t get it — until they ran the idea by their wives. “A day later they would always email me frantically or call me and say: ‘What can we do to get one? I talked to my wife, and she said… this has been a problem for the last 10 years,'” Julia said.
One of Julia’s mentors at MIT, Jean Hammond, introduced Julia to women at Golden Seeds, a seven-year-old group dedicated to investing in young companies founded or led by women. Several months later, Julia raised $125,000 from a number of angel investors affiliated with the group. Lark was one of 12 investments Golden Seeds made in 2010, triple the number of investments it averaged the previous three years.
In June, Lark’s silent alarm clock made its debut in Apple stores, retailing for $129.
Read the full article at the Wall Street Journal here.
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About the guest blogger: Emily Glazer covers personal finance and dabbles in tech for the Wall Street Journal. Follow her on Twitter at @EmilyGlazerWSJ.