Female entrepreneurs have great ideas, but they have a tendency to get in their own way in the pitch room with venture capitalists.
That was one of many important takeaways from a panel called “Giving women money: Access to capital and female entrepreneurs” at the ASCEND summit in New York City on Friday. The event featured leading voices on advancing women into the C-suite and on boards.
The panel was moderated by “Morning Joe” co-host and Know Your Value founder Mika Brzezinski and Columbia Business School professor Rita McGrath. Panelists included Annie Lamont, managing partner at venture capital firm Oak HC/FT and Steph Korey, co-founder and CEO of the successful travel brand, Away.
The panelists discussed challenges many business women face when trying to get investors and offered solutions to avoid these common mistakes:
A lack of confidence.
Women often lack the confidence in the pitch room. That's a shame because it's a crucial component during the approval process, panelists said.
“A lack of confidence is a killer,” said Lamont. “I want people worried and always thinking intellectually, but I don’t want them worrying about themselves. If you’re worrying about yourself, you’re not making good decisions. You’re protecting yourself, you’re not being honest. It’s not good business.”
That said, it is possible to be overconfident. Lamont remembered one entrepreneur ending his pitch by saying to her: “In your 30 years of venture capital, I bet I am the most exciting entrepreneur you have ever met, and this is the best business you’ve ever backed.”
That man ended up raising $150 million, then losing it all, she said.
Women under-promise and over-deliver.
Women have a tendency to be very cautious when it comes to business projections. Korey admitted that in one pitch earlier in her career, she presented slide upon slide of her company's past milestones and shied away from bigger projections.
“Investors aren’t investing in the past, they’re investing in the future,” she said. “And what I realized is women love to under-promise and over-deliver … They’ll take the projections that men have, and cut them in half … but in the fundraising process, you have to say what you’re really going for.”
Lamont said she sees this often from the other side of the pitch table.
“What women do is they paint a picture of a vision,” she said. “They may not be thinking too small, but they’re painting the picture too small.”
Brzezinski chimed in: “Women are always asking, how can they stop from looking aggressive? I want to turn that question around and ask, ‘how could I inspire more women to be aggressive and have more ambition?’”
Women try to be men.
Entrepreneurs have different styles, and it’s important to embrace yours, rather than withdrawing or trying to be like a man.
“I do think women have different styles. There are some women like Kate Ryder, she’s kind of a badass,” said Lamont, referring to the CEO of the women’s health app Maven Clinic. “But a female partner of mine, she had a style that’s super warm and friendly and outgoing. The typical Silicon Valley move is to be all cool and different, but my partner is not cool. But everyone loves her.”
Korey has embraced her style. “I personally don’t love the spotlight,” she said. “That’s not my MO. But, I think I’m good at my job.” Away, Korey pointed out, has raised over $80 million in the three years they’ve been in business.
They don’t do their homework.
This is an issue across gender lines, but it’s a critical problem that could make or break a pitch.
“What we want see is an entrepreneur who knows their space better than anybody else,” said Lamont. “We want to see that you know the market, and you’ve been talking to people in the market who now know you. This isn’t just a glint in your eye, you’ve gone out and done your homework.”
They don’t seek support.
“One thing a lot of women don’t do is find the support network to help you,” said McGrath.
Having a team and being able to draw talent is one of the most important parts of pitching, said Lamont.
“A good entrepreneur comes in and they have brought in a couple of people, a team they’ve been able to attract,” she said. “I want to see that the entrepreneur not only has the ability to attract them, but they appreciate talent. We have to see that. You’re selling your team and your talent."