To choose to become a startup founder, they say you have to be a little bit crazy. As a former founder myself and an advocate for entrepreneurs, I like to think it's a good kind of crazy. To go out on a limb and start a startup, you have to believe you'll beat the odds. You have to have an unreasonable amount of optimism and unrelenting drive to change the status quo. And if you are a founder who doesn't fit the traditional mold that investors typically support, the odds of success are even smaller and the optimism and drive needed to persevere are colossal. And yet, the founders we work with at Project W dive headfirst into building and scaling great companies and creating world-changing solutions to problems that impact millions. They know the odds, and they are taking the bet boldly.
After a while, it is easy to become disillusioned as a startup founder. I know in my bones that these founders will change the world and it infuriates me to see the excessive hurdles they gracefully leap over – being asked to show proof points above and beyond those that founders without a descriptor in front of the word "founder" typically face. The numbers are clear and disappointing. Funding for all-women teams has been hovering around this 2% benchmark since I started my first company over a decade ago. Despite a growth in social awareness of the problem, the trend is moving in the wrong direction. According to Pitchbook, in 2022 VC funding for all-women teams dropped below 2% again to just 1.9%. We have been celebrating diverse founders and talking about this problem and working to drive capital for over a decade and the metric that matters – access to capital – is eroding.
Even the most optimistic, bold, positive, driven, world-changers can become demoralized by the bias in the boardrooms. It is next to impossible to be immune to the constant rejection and microaggressions that are pervasive in VC. That said, the anger this bad behavior sparks can derail a raise. I say this because my own frustration with the VC process got in the way of my success when I was fundraising for my first company. I wasted energy being (rightfully) angry at the kind of things people were saying to me during a pitch.
Don't get me wrong, the rage is justified. Let me say that again; THE RAGE IS JUSTIFIED. I felt it slowly boil inside me as a founder, and as an Investor, I see it (and the cause of it) all the time. It infuriates me. The most maddening part is that even justified rage can permeate the energy behind the next pitch and ruin a founder's chance of getting funded. This is why when I work with founders on how to mitigate bias in the fundraising process, one piece of advice that always comes up is this: find a way to cage the rage. I don't mean ignore it or suppress it. "Cage the rage" means find a way to prevent your justified frustration and anger from seeping into the room and undermining your fundraise. Acknowledge it. Vent about it to your partner or best friend – or even better – talk to other founders about your experience. Know that you're not alone and that you are justified in feeling the way you do. And then do whatever you need to do to get it out of your system so your vision of the future is what is felt in the room during your pitch.
There is so much outside of your control as a founder, and, unfortunately, the systemic problems will likely worsen in an economic downturn. Focus on what you can control. Channel that anger into motivation and go get that money so you can change the world. We want to see you succeed, and Project W is here to help.
This is the second in a quarterly series of tips, tricks, and advice from Project W Program Director, Emily Baum.