The life of a fashion entrepreneur is not an easy one: Retail startups are a risky category for VCs, who prefer to invest in scalable, high-growth industries. But being a female entrepreneur is even harder. VCs tend to be overwhelmingly male, uninformed about the business — and patronizing.
In this edition of Confessions, we chatted with a female startup founder who has been through the investor round to ask what it’s really like.
Why did you start your company?
It was an industry I cared about. At the time, I was working with a lot of men. I talked to other people around me who had made it work, and they were men, because people who had managed to have successful startups were men.
What’s it like to raise funding in this space?
I’ve done everything on my own. I’ve mostly started out by funding myself. I get good press which has helped the business, but e-commerce is so competitive right now that unless you’ve got marketing and PR and design you’re not going to get much traction. I learned that the hard way. I once tried to figure out if I could get this one person to invest, who first told me that “It’s going to be easy to take you to the next level” but then he turned around and said “This business model isn’t going to work.” He thought I was just some girl who had an idea, not that I had built it all myself. He wanted to come on and manage everything.
But in general, the business is tough, for everyone.
Yes, but the expectations are gendered. For example, most investors want to see $1 million in sales before they’ll even talk to you. No small e-commerce business can get that these days. But for most startups, they get funded on potential. But for me, it was always about having to prove it and it not being enough.
What happens during meetings?
I’ve gone on investor meetings people assumed were dates. Once, when one guy realized it wasn’t, he just proceeded to tell me how this will never work. If you pay more attention to what women are saying, everyone is saying they need a business like mine. At places where the boards have women on them, I’ve been treated differently. I’m educated and I know what younger millennial women want. And all that stuff doesn’t mean much to them.
You’re talking about mansplaining VCs.
Yes. Every meeting I’ve had I’ve been told I know nothing about this stuff even though I have a degree in fashion and built this company. Then they pick everything apart, which is fine. But usually it’s about more than that: Most male investors are supportive of the idea but don’t want to pursue it. In some ways it feels like their egos get bruised because they don’t know this industry and they don’t want to risk coming off as stupid. That is my most pessimistic side speaking but I’ve got that feeling in my gut on a lot of instances. So asking for us to “prove” ourselves is some sort of misogynistic exercise. One in which they never really plan on giving us the benefit of the doubt because they’re ultimately threatened by the power we could gain if they did help us.
I think part of the problem is that men that hold the money. The investors don’t understand our business or market, so they want to see tons of financial results even before they will invest. Well, we all know that this is essentially impossible to prove unless a business is invested in initially.
So the burden is greater on you?
Yes, exactly. I’ve seen people with similar ideas get more support. I’ve seen it all. If a man were pitching some BS tech app — you see this everyday — that a finance guy didn’t understand, he’d still be more likely to take a chance. Whether it’s because they don’t understand our market, or don’t trust women, I don’t know. But it’s an uphill battle and with the amount of energy it takes just to talk them through what we’re trying to do, and trying to convince them to stop underestimating us, it can really just take the wind out of anyone’s sails to keep talking to what feels like a wall. That on top of running your business on nothing, I think most women just give up.