Astia, Google Expand Effort to Match Women-Led Startups with VCs
In social media circles, the story of the month isn’t Twitter’s impending IPO, but rather its feud with outside critics over the tiny number of women executives and board members at the San Francisco company. Twitter CEO Dick Costolo says he’s had difficulty finding a qualified woman to serve on Twitter’s board. Outsider Vivek Wadhwa, the scholar/essayist/entrepreneur, replies that while there may be a shortage of women engineers, that doesn’t mean there aren’t capable women in other industries, and calls Costolo’s stance an example of “male chauvinistic thinking” and “the elite arrogance of the Silicon Valley mafia.”
But to Astia CEO Sharon Vosmek, both sides are missing something. “This whole conversation about the dearth of women technology entrepreneurs is a myth,” she says.
The problem isn’t that there aren’t enough women technologists or startup founders, Vosmek says; it’s that the companies they start don’t have equal access to investment networks. San Francisco-based Astia promotes women-led enterprises in infotech, cleantech, the life sciences, and consumer products. And one piece of evidence behind Vosmek’s assertion is the huge waiting list for slots at the nonprofit’s venture lunch, where startup founders belonging to the Astia network describe their companies to venture investors.
“We have easily triple the number of deals to showcase as we have the capacity to showcase,” Vosmek says.
Ten months ago, the Astia venture lunches became a monthly event, featuring three women founder/CEOs per lunch. Now, with help from Google and other Silicon Valley players, the program is being scaled up again. Astia announced last week that the 2013-2014 season will include 36 lunches across Astia’s network in San Francisco, New York City, and London, with 102 companies taking the stage overall.
And the event could grow even more. “This is a pilot,” Vosmek says. “We know we have even more [companies] than that, we just need to nail the model.” She says Google has already agreed, in principle, to supporting additional “pop-up” lunches in places like Berlin, Dublin, and Tel Aviv.
The founding motivation for the venture lunch series, according to Vosmek, was survey data showing Astia companies weren’t having much luck landing their first key meetings with venture capital firms. It’s not hard to imagine why this might be a challenge, given that most venture capital partners are male, and have male-dominated professional networks. The striking thing, Vosmek says, was how universal the problem was.
“When we asked them ‘Have you presented to any venture fund?’ what we found in the answers was, ‘No, we don’t know any,’” Vosmek says. “They have angel money, friends and family money, and maybe have even had a casual conversation with a venture fund at a low level. But I’m talking about the investor meeting where you bring in your slide deck and your key executives and you talk through the idea. The majority of the companies in our pipeline have not had that experience.”
Providing this experience is the point of the venture lunches. Each lunch is built around three 20-minute presentations from pre-screened Astia member companies. (Entrepreneurs aren’t allowed to present until Astia has polled at least 25 members of its advisory network and “85 percent or more have said ‘This deal is investable today,’” according to Vosmek.) At this year’s lunches, two-thirds of the presenting companies have been offered term sheets or follow-up meetings on the day of the event.
Natalie Wisniewski, whose mobile health startup Profusa went through the Astia program in 2010, says her own fundraising experience was typical of the pattern Vosmek describes. The company managed to raise $7 million in non-dilutive grant support to gather scientific data on the efficacy of its biochemical sensors, which send data to smartphones to help with chronic disease management. But for years, Wisniewski failed to make much headway with equity investors.
“It seems that my male counterparts, through their social circles, have more direct connections” to the venture-capital world, says Wisniewski, the startup’s chief technology officer. But after she presented at one of this year’s Astia lunches, she was able to restart a number of conversations with potential investors.
“I have been at this for a while, and at the lunch I re-engaged with some investors I hadn’t seen for a while, and they remembered me and my story, and I got to tell it again and get them excited about the direction we are going,” Wisniewski says. “And some people I didn’t know followed up afterward. A single lunch is not a solution, but it’s how it fits into the overall network.”
None of the investor conversations sparked by Wisniewski’s lunch presentation have led to a term sheet, partly because ProfUSA hasn’t finished gathering human-trials data for its prototypes. But Wisniewski says she’s optimistic. “You lay the groundwork for what’s to come,” she says.
Richard Simoni, managing partner at Asset Management Ventures, a venture and private equity firm in San Francisco, has attended three Astia lunches so far. (Coincidentally, Asset Management is one of ProfUSA’s investors, though that particular deal didn’t come about through Astia.) Simoni says the lunches are useful to his firm for several reasons. First, there are only three presenters per event, in contrast to the endless pitches at most startup-accelerator demo days. Second, the companies have been carefully pre-screened. Third, the investors in the audience ask smart, aggressive questions. And finally, it’s a chance to learn about companies Simoni might not have encountered in any other context.
“There is overlap between the companies in Astia and our non-Astia deal flow, but it’s fairly small,” Simoni says. “I have certainly seen lots of companies at Astia events that I wouldn’t have seen otherwise.”
Much of the support for the expanded Astia venture lunch series is coming from Google for Entrepreneurs, a wing of the search and advertising giant devoted to supporting early-stage entrepreneurs—including women in rural and emerging markets—and making sure they have access to Google tools and technology. “With Astia, what really appealed to us was that this was not just a meetup, not just a networking event, but this was really about finding high-impact entrepreneurs who are women, and helping them get access to the tools and resources they need to grow,” says Bridgette Beam, global entrepreneurship manager at Google. “They are very results-driven, just like Google, so we see that cultural fit. They don’t want to just talk about boosting women-led entrepreneurship, they really want to be part of that process, and that’s very rare.”
In addition to helping to pay for the lunches in San Franciso, New York, and London, Google plans to help Astia find locations for one-off lunches in other cities such as Berlin and Sao Paulo, Beam says. And the idea could spread much farther than that. “The long-term goal is not just more lunches put on by Astia, but figuring out how to really scale and expand this globally, very much like Startup Weekend, which is now in 500 cities across the world,” Beam says.
Microsft, Andreessen Horowitz, and a number of other sponsors are also helping to expand the venture lunch program. “The message is being very well received by the dominant players in the market,” Vosmek says.
So, would Wisniewski, the Profusa CTO, recommend participating in an Astia lunch to her peers? “Absolutely, without question,” she says. “There are other ways to fill the gap [between women-led companies and venture firms] but I think the Astia lunch is one good way to start. There is only upside.”