As a woman, it’s hard not to like the sound of something called angel investing. You know, that idea that someone may be watching out for us.
I keep my curiosity focused on what we can do with modest amounts of wealth (admittedly, a relative term) and I’d always heard that angel investing is that first round of VC funding, say at $50,000 instead of $5M. Fifty grand is still a lot of money. But I learned that, by joining an angel group, individual investors can pool smaller sums — even $5000.
In May, Catalytic Women had the opportunity to ask them some questions on how women can fund women social (and traditional) entrepreneurs without investing a bundle. I hope you enjoy their Q&A.
Q: What are the nuances between impact, angel and venture capital (VC) investing?
A: Impact investing is a focused investment strategy to gain market rate ROI and social impact. This is not the below-market, corporate social responsibility screens of yore but rather a strategy that creates value for shareholders and society. Marie’s firm, Equilibrium Capital, offers impact funds for institutional investors, and they consider a variety of social impacts: resource use, jobs created, etc.
Angels and VC both invest directly in promising entrepreneurial businesses in return for stock in the companies where they invest. The Angel Resource Institute distinguishes between angels, who generally invest their own money in start-ups and very early stage companies, and VCs, who provide capital they raise from others to invest in later-stage businesses for growth.
Nuances among the investing options include opportunities that can look different on the east or west coast, or even within regions. (Marie splits time between offices in SF and Portland.) The panelists agreed that the west coast offers more opportunities for women entrepreneurs, is more entrepreneur-friendly, and attracts attention from global investors.
Q: Why invest in women? What’s the big deal?
A: Marie shared her experience as CFO of the Women VC Fund, which actively looks for teams lead by women or where women have a strong voice with the men on investor teams. See their great research on women entrepreneurs, and also Criterion Institute’s resources on Women Effect Investments. We’re all new to this! It’s only been 50 years since women could earn an MBA at Harvard.
Q: What are you most excited about in your work?
A: They all spoke of a global vision for growth and access — for entrepreneurs and investors.
Amy talked about Astia’s model: men and women investing in women-led businesses. Astia Angel started in January 2013 and just closed its first two investments. In the spirit of women’s collaboration, as a founding member of Astia Angel, Sharon invests in one of them.
Sharon talked about why it’s a great time to be a woman founder. There are lots of resources only available to women entrepreneurs, including Alley to the Valley, Project Eve, Watermark, WomenCentric, Women 2.0 and others listed on her website. (More, too, in the Catalytic Women blog archive.) Sharon also sees startups led by women representing a diverse range in ages, from 21-60, who participate in these different kinds of networks. Women need unique tools for success — and are increasingly stepping up to help one another change the status quo.
Marie mentioned the ability to focus investments. While this panel didn’t dive into the topic of impact investing (her firm, Equilibrium Capital, offers sustainability driven investment products and strategies for institutional investors), being able to zero in on a particular market, gender, type of social impact, or geography has never been easier.
Q: How can our attendees get involved in these issues? How does it look in terms of money and time?
Resources on impact investment for individual investors: ImpactAssets 50 lists top impact fund managers, HIP Investors (Human Impact + Potential) is a local impact investment advisor that offers tips online. The Omidyar Network is looking at the nexus of government funding, philanthropy and capital. RSF Social Finance and ImpactAssets offer great funds where you can start: $1000 for a 90-day Social Investment Fund or $5000 to invest in a donor-advised Giving Fund.
Angel investment groups focused on women-led companies include Astia Angel ($3000 is the annual fee to participate in regular investor meetings, with no minimum first-year investment), Golden Seeds, and Pipeline Fellowship offering training to small cohorts of women contributing $5000.
Attendees mentioned other great research on investing in women-led business from Dow Jones, McKinsey and Packard Foundation.
Q: Where can an investor new to this world learn about early stage high-impact investments that support women?
They also shared their journey of how they got to this work. I couldn’t possibly do that justice (you’ll just have to join us in person next time!), but a here’s a bit more on their impressive backgrounds.
Amy Gips is the Founder of Astia Angel and Director of Investments for Astia, Amy aids in the investment activity of all Astia companies — including deal flow management, due diligence and investor relations. As an experienced investor, Amy has invested in debt and equity in companies at various stages across multiple industries. Amy has focused on investing in women-led ventures as an angel investor with Investors’ Circle and a Fellow with Criterion Institute.
Marie Jorajuria is the VP of Finance and Chief Compliance Officer of Equilibrium Capital Group and is also CFO of the Women’s Venture Capital Fund. She has worked in senior management and compliance with a number of innovative financial startups and, as a woman founder, launched, built and sold a company in Madrid, Spain. Marie’s social impact extends to her role on the board of directors and finance committee for public radio station KQED.
Sharon Knight created Avik Ventures, an angel investment vehicle, to partner with entrepreneurs and investors in providing both capital and expertise to help early stage companies. As an investor, her focus is healthcare solutions that promote improved patient access or consumer education. Her current portfolio includes Seed and Series A investments. In addition to involvement with Astia Angel, Sharon is a mentor to Springboard Enterprises, an accelerator for women-led startups, and Rock Health, an incubator for healthcare startups.