With Donald Trump back in office, the VC community is adjusting its expectations. While sectors like banks, technology, defense and fossil fuel stand to benefit, the impacts on the consumer products market are less clear.
Several VCs who have supported Trump’s campaign are investors in fashion and beauty companies. The investment firm of Andreessen Horowitz, who reportedly made a financial contribution of $2.5 million to a pro-Trump political action committee, backed the direct-to-consumer beauty brand Glossier in 2014. In 2019, David Sacks’s Craft Ventures supported footwear brand Birdies, while Sequoia Capital’s Shaun Maguire invested in the clothing subscription service Stitch Fix in 2013 and in Rothy’s in 2018 — these VCs have financially contributed to Trump’s campaign, the Republic National Committee or PACs. This points to a belief that consumer products companies will thrive under a Trump administration.
But Jesse Draper, founder of Halogen Ventures and an advocate for women-led startups, said the new political climate reads as a call to action for investors. Draper said the Trump administration’s lack of emphasis on gender diversity and equity could create even more obstacles for female founders. In his first term, the Trump administration demonstrated a lack of emphasis on gender diversity and equity through actions like rescinding affirmative action guidelines, in 2018; repurposing funds for women’s initiatives, including the Women’s Global Development and Prosperity Initiative, in 2019; and proposing cuts to Small Business Administration programs and rolling back equal pay data collection requirements, both in 2017.
Women-led startups already receive a small fraction of total VC funding — just 2% in 2023, according to market research company Pitchbook.
Draper also said she’s worried diversity-focused initiatives, in general, will face new obstacles under the new administration. Trump’s administration rescinded guidance promoting affirmative action in schools and workplaces. It also reduced funding and support for diversity programs in business and education. This shift was seen again in 2023, as Trump-nominated Supreme Court justices ruled to end affirmative action in college admissions.
Other VCs contacted for comment on this story declined to participate.
“I’m devastated, honestly,” Draper said, discussing her initial reaction to the election results. “It feels harder this time because we know what we’re in for. We already face challenges as a women-focused fund, and this may only amplify those. But it also reinforces that what we’re doing is essential.”
Halogen Ventures has built a portfolio of 75 women-led companies, including underwear brand ThirdLove, shoe brand Sarah Flint and beauty label Live Tinted.
“This is a moment for VCs to step up,” Draper said. “If you believe in diversity and equity, invest in funds and companies that prioritize those values. … Venture capital is where you start. Early-stage funds support companies that will shape the next 10 to 20 years.”
She added, “Investing in women pays off. Women founders often outperform and get more out of every dollar.” Research from consulting company Boston Consulting Group and development program Kauffman Fellows supports this.
Many consumer brands will likely face new pressures, as Trump’s policies favor domestic production and American-made goods. And, as a result, some VC firms may choose to fund American-focused or “patriotic” consumer brands, Draper said.
“But the best deals will always get done,” she added.
Draper also said Trump’s policies also make her “more confident than ever” in her company’s current strategy, which emphasizes consumer brands that support family life alongside lifestyle brands. “Our focus is on startups that address childcare, consumer healthcare and financial health — areas critical to households. Trump’s administration may actually shine a spotlight on these categories, making them even more essential.” Draper described the sector as both resilient and poised for growth as Trump has previously supported family values.
