In This Issue:
- Credit Where It's Due
- Q&A With Melissa Widen
- Remembering RBG
- Social Media for Startups: Tips for Building and Branding
Credit Where It's Due
A look at how women in the banking industry have led women's economic empowerment
If you were a woman in the early 1970s seeking a loan or applying for a credit card, you likely were charged a higher interest rate, required to make a larger down payment or refused credit altogether. That woman was some of us, and most certainly our mothers, older sisters and aunts. Not until the passage of the Equal Credit Opportunity Act of 1974 were these practices that unfairly tipped the scales against women and other minority groups prohibited.
As the Project W team prepared to spotlight First Women's Bank and its co-founder and Chief Administrative Officer, Melissa Widen, we decided to take a look at how women have fared in the banking system. We found that, in many cases, women have been the drivers behind economic empowerment of women by creating access to banking products, by innovating and by holding leadership positions in their institutions.
Long before the passage of the Equal Credit Opportunity Act, women were breaking down barriers in financial services. A surprising number of women served as bank presidents in the late 19th and early 20th centuries. While some of these women actually founded – rather than inherited – their banks, they were almost all wealthy and white, and most of their banks were not focused on providing services and products to women. The notable exception among these early banking pioneers was Maggie L. Walker, an African American businesswoman who from 1903 until her death in 1934 used her bank, St. Luke Penny Savings Bank in Richmond, Virginia, to empower the economic status of women and to strengthen the emerging Black middle class in the local community.
Shortly following the passage of the 19th Amendment in 1921, the Bank of Italy, the predecessor to today's Bank of America, opened the United States' first bank by and for women, the Women’s Banking Department in San Francisco and, subsequently, in Los Angeles. Both Women's Banking Departments operated as separate banks and were directed and staffed exclusively by women. These institutions gave women access to their own accounts where they could manage their finances without the involvement of their spouses and offered advisory services and financial education to enable women to take control over their financial decisions.
Decades later, in 1978, a group of women in Denver, Colorado, founded the Women’s Bank with a mission to provide credit to women. The Bank was headquartered in Denver's financial district contrary to suggestions that it should be located in a suburb "where housewives lived." Despite predictions the bank would fail, the founders eventually had a successful exit through a sale to what was then Colorado Business Bank.
About the same time, in Los Angeles, a group of local businesswomen founded the First Women’s Bank of California with a similarly feminist mission to provide credit to women and to help women manage their money. More than 60% of the stockholders in the Bank were women and included some notable celebrities. However, the Board of Directors concluded there were no "qualified women" to serve as CEO, and a man was appointed to fill that position.
The First Women's Bank of California may not have looked hard enough. By the mid- 1980s and early 1990s, there was no shortage of "qualified women" in banking as many women were rising in the ranks of money-center financial institutions and serving as presidents or CEOs of important regional banks. With the recent appointment of Jane Fraser as CEO of Citigroup, a woman is now at the helm of a Wall Street bank, and there will be more to come.
Project W is honored to have had a group of distinguished women in financial services on the faculty of our recent FinTech Women Entrepreneurs Boot Camp (WEB). As Chava Brandriss, Project W leader and partner in DWT's Banking & Financial Services practice noted: "The extraordinary women on the WEB FinTech faculty are following a storied tradition of women leaders in financial services empowering the next generation of women. By giving of their time, wisdom and expertise, our exceptional faculty is paving the way for the success of women who are innovating in banking, finance and payments."
Read here about the women leading the way in the financial services sector who so generously served on the WEB FinTech faculty.
The Project W Team
Q&A With Melissa Widen
Co-Founder & CAO of First Women's Bank
First Women's Bank (FWB) was founded by women for women. Subject to final regulatory approvals, FWB plans to launch in early 2021. Founding a bank presents unique challenges: dealing with multiple regulators, assembling a team with the right expertise, and developing a strategy that sets the bank apart from its many competitors. We asked co-founder and Chief Administrative Officer Melissa Widen about the gender-focused mission of FWB and about her journey as a founder.
Q: FWB's mission is to empower women. Why choose a bank as a vehicle to carry out that mission?
Women are leading an economic revolution in this country. The women’s economy is large, powerful and growing, but it has a persistent need. There is a gender gap in access to capital, and it’s one of the problems the First Women's Bank was formed to solve.
There's extensive research on the gender gap in access to capital—it is real, it is measurable, and it is preventing women-owned and women-led businesses from reaching their full potential. Women own 42% of all small businesses, yet they receive just 16% of all conventional business loans. When the current economic crisis passes, that gap could be even greater. We will be uniquely equipped and ready to address it.
Q: What is the origin story of FWB? How did you and your two co-founders come together to found FWB?
Our story really shines a light on the power of networks. One of our co-founders, Lisa Kornick, had the original idea for this bank more than three years ago. She tapped into her broad network to bring Amy Fahey and me together, and from there we continued to leverage our collective networks to refine our mission, assemble a truly amazing team and begin to build this first of its kind bank.
Q: One of the key factors investors look for is whether there is a strong addressable market for the company's product or solution. How did you determine and validate the market opportunity?
When I first heard about the idea of a woman's bank, I asked the same question. So, I dug into the data to better understand the size of the market opportunity and problems that need solutions. I was surprised by the vast amount of data that tells a consistent and compelling story about the women's economy and its need for capital. We know that the number of women-owned businesses is growing rapidly—twice as fast as the national average last year and up over 114% over the past 20 years. This exponential growth has been driven, in large part, by women of color. Of the approximately 12.9 million businesses owned by women in this country, 50% are owned by women of color. Last year, businesses owned by women of color accounted for 89% of the new businesses opened every day. And the Harvard Business Review estimated that women represent a growth market more than twice as big as China and India combined. So, the opportunity is significant, and we will be uniquely positioned to serve this market. First Women's Bank will be the first bank in the country founded by women, run by women and strategically focused on understanding and serving the women’s economy.
Q: Female founders face many obstacles building a business – from raising capital to breaking into networks of influence dominated by men. Banking has traditionally been an old boys' club. What challenges did you and your co-founders face and how did you overcome them?
You are exactly right. Women founders face a unique set of obstacles in addition to the challenges inherent in any startup venture. And there is no doubt that we have faced many challenges, including raising capital in a pandemic. But our mission to grow the economy and advance the role of women within it has elicited an overwhelmingly positive response to this project and has allowed us to build momentum even in the face of the current headwinds. Gender equality and economic parity are among the most pressing and urgent social issues in our country today, and people are looking for ways to channel their frustration around systemic prejudice and inequality into effective action. Supporting the First Women's Bank is a way to be part of the solution for the women’s economy.
Q: Not everyone can make an equity investment in a female-founded enterprise. How does FWB provide an alternative to women and men who want to put their money to work for women-owned and led-businesses?
As the only bank in the nation with a strategic focus on gender equity, First Women's Bank will offer corporations, nonprofits and individuals a concrete way to show support for gender equity simply by keeping deposits at the bank. When we open early next year, come join us and bank at First Women's Bank!
We are all beneficiaries of the extraordinary legacy of Justice Ruth Bader Ginsburg. We can honor her legacy by each doing our part to overcome the systemic barriers to gender and racial equity. Join us in working towards a future where everyone has a seat at the table.
Social Media for Startups: Tips for Building and Branding
Your company needs a face, so why not make it yours?
By Josh Gardner, Social Media Specialist, Davis Wright Tremaine
A long-time social media professional, Josh shares his insights and tips on how everyone from a new founder to a seasoned investor can get the most out of social media.
When I started as Davis Wright Tremaine's social media specialist last year, I'd worked in content and social media for the better part of a decade, but the legal world was completely new to me. At points I felt daunted: by legal jargon, powerful personalities, and pain points I'd never encountered in my years in news media. While the learning curve seemed steep, I found a big exception in my work with Project W. It turns out social media in the women-driven startup world is, in a word, welcoming.
Other words that come to mind are engaged, friendly, and accessible—perhaps more so than any other social media sphere I've worked in. This is all just to say that the water is fine. Below are some tips for helping you jump in.
Spend time where you're most comfortable.
Founders, investors, and orgs like Project W can be found sharing updates, ideas, and opportunities across all platforms. That means you can choose to use your precious energy where you're most comfortable. For most, that means LinkedIn with its Facebook-like functionality and all-business focus. That focus broadens considerably on Twitter, where access to you and your access to others is unfettered by invite-only networks. If your company has something highly visual to offer, photo-focused Instagram could be your most suitable platform.
Wherever you go, make lots of friends.
Social media is a 24/7 networking event. As you build your social network, adding connections you know in real life is a start. Have those friends shared content from individuals whose goals intersect with your own? Don't be afraid to add them. Follow accounts like Project W’s and mine their posts for related organizations to follow. The more people you add, so long as your shared interests are genuine, the more you'll be followed by others.
You are your company.
While it might make some people uneasy, your personal social media presence should be entwined with your company's. It doesn’t have to be seamless, and you don’t have to leverage ALL your social media accounts. However, it’s crucial for your startup to have a face and not just a brand. Designate an account that is You As Your Company and make your connections and share posts with that in mind.
"What do I share?"
It's the most frequently asked question I get from users who are somewhat new to social media. In the words of Nora Ephron: "Everything is copy." You have a story to tell already, you just need excuses to tell it. Or not! You're the expert on you and your company, which is its own excuse. You'll find that other users in the startup world will be responsive to your authenticity and passion. Some prompts for sharing:
- News related to your industry, while adding value by discussing your own related experience
- Recent developments at your company
- A post about something you learned today
- Reshare an associate’s story or congratulate them on a success
- An inspirational quote of the day
- Your own successes: Do not be afraid to post about these!
Social media is a two-way street.
It's the most critical takeaway I can offer. Social media is a conversation, not a lecture. For every post of your own, you should be liking, sharing, or commenting on someone else's. They want to be seen just as you do, so help them out! Tagging is also critical and can win you followers. Are you talking about another company? Tag them. Giving kudos to a fellow founder? Tag her. Celebrating a personal role model? Tag them.
While you may not have a lot of time to dedicate to social media, just a few minutes each day will go further than you might think. No matter which platform you choose, the golden rule is you get out what you put in. Remember, as you endeavor to market yourself on social media, there's a world of talented founders and investors out there wishing to be embraced—and who want to embrace you.
- Fundr Startup Investing Made Easy
- EY's Entrepreneur’s Access Network for Black & Latinx Founders
- USDA Rural Development Business & Industry Loan
- SoGal Black Founder Startup Grant
- Collab's Capital Readiness Immersive
- Black Girl Ventures x Rare Beauty Brands Pitch Competition
- KKR Small Business Builders Grant
- Dany Garcia & Hello Alice’s Latinx The Mosaic Grant Program
- The Future of Work Grand Challenge with $6M in Prizes
- Playfair Capital's Female Founders Office Hours
- Entrepreneurs Roundtable Accelerator
- Morgan Stanley Multicultural Innovation Lab
- Ideas42 Venture Studio Cohort