Launching a startup business takes money — and women-founded businesses receive an infinitesimal amount of venture capital afforded to men, according to a local investment group.
“Historically, it’s been 2%, and it’s dropping, which is concerning — that means 98% or more goes to men,” said Stephanie Bauer Marshall, board president and co-founder of Citrine Angels, a female-focused angel investment nonprofit group that has now invested more than $1 million in female-founded companies, since its inception in 2019.
“An angel investor is usually someone interested in helping companies at the earlier stages,” said Marshall. “Angel investors are typically individual investors.”
The milestone is being announced during DC Startup Week 2023, which runs through Friday, Oct. 20.
The Citrine Angels are, “continuing to raise the bar and create opportunities for women looking for investment opportunities as well as female founders in need of capital.”
“We have to change the face of who is writing the checks and making the decisions about where that money goes,” Marshall told WTOP. “And I think that can start with angels.”
She was asked if women-founded companies are run differently than companies owned by men: “Diverse companies, in particular women-founded companies perform better, long-term. They’re also more capital-aware, so they conserve their capital, and it goes further.”
Opportunities, education for first-time investors
Marshall said Citrine Angels aims to smooth the way, and provide information that will enable inexperienced investors to get behind companies they believe in.
“We have a lot of first-time investors. We offer education, and purposely keep our membership dues very low and accessible to help people over the hump of ‘I’m interested in this, but I don’t really know how to do this.'”
Rather than fewer, larger investors, Citrine Angels is encouraging more women to write more checks.
“When you think about $1 million, a lot of whom are first-time investors, who are writing smaller checks for $5,000 or $10,000, that’s a lot of woman power,” said Marshall.
In addition, the network of women is providing more than just money.
“When you look at women-founded companies, they need more than just capital, right? They need connections,” said Marshall. “When you have a lot of amazing, strong, successful women, they do more than just say, ‘I’m gonna write you a check.’ Those are all people who can help you later on — they can make introductions, and (give) advice on financial, the market or legal” issues.
‘Having women investors was deeply important to me’
The CEO and founder of Wellfound Foods, a D.C.-based startup that offers healthy, ready-to-eat foods from vending machines has received two infusions from Citrine in 2021 and 2022.
“Having women investors was deeply important to me,” said Sarah Frimpong, whose machines are located in D.C.-area hospitals, airports and train stations, among others. “We have things like sandwiches, salads, green bowls, and we want to make it easy for you to eat healthy, no matter where you are.”
Frimpong has received a lot of buy-in through the women-focused angel investor group: “What I loved about Citrine, specifically, is that it’s a cohort of women investors. It’s not just, you know, one woman investor.”
“Fundraising is all about building a bigger tent, and getting people who believe in the business, and who will carry the flag for the business,” said Frimpong. “To have 15 women through Citrine who are doing that for Wellfound is phenomenal.”
