As someone who has started and led venture-backed companies I know how hard it is to raise money, even if you have a dream team focused on bringing your idea to life.
Women founders have it even tougher than most. According to Crunchbase’s Q2 2019 Diversity Report, just 3% of venture funding went to Women Only Founders.
Many venture capital firms stick to serial entrepreneurs they know from past deals and even the most progressive firms interviewed by Crunchbase state that less than 40% of their portfolio is managed by someone who identifies as female.
While challenges still exist, there is encouraging news as reported by the 2018 State of Women-Owned Businesses Report, commissioned by American Express.
The report revealed that over 48 years the number of women-owned businesses increased a dramatic 31 times from 402,000 to 12.3 million in 2018. During that time, employment for these firms grew 40-fold from 230,000 to 9.2 million, and revenues rose from $8.1 billion to $1.8 trillion– 217 times greater.
On the other side of the coin, are women being trained and groomed to believe they can start their own company and manage it effectively? According to an article entitled 7 Challenges Women Entrepreneurs Face (and How to Overcome Them) written by Paula Fernandez for Business News Daily women entrepreneurs have other hurdles to be overcome as well.
So, what are the best ways to get through the Venture Capital crisis facing women today?
Look for Grants and Incubators
Connect to all of the local funding and grant sources and start-up incubators in your area. Here’s a great one in Chicago just for Women-led businesses as an example. Check out the attached list of Incubators around the country to find that might work for you. Also, go to SeedRankings.com and check out the accelerators they recommend.
Apply to the NAR Reach program
This highly successful program started in 2013 has birthed some of our industry’s most successful tech companies like Docusign and many others. Named among the best in the world for technology accelerators for the second consecutive year by the Seed Accelerator Rankings Project (SARP), the NAR REACH program is definitely something you need to check out.
Apply to Moderne Ventures
Led by Constance Freedman is another early investment group focused specifically on real estate. Check out their application here. https://www.moderneventures.com/passport-application
Do more with less
While raising money can be a key to taking your company to the next level, you also need to take care to use any capital infused into your business wisely. Remember that it always takes at least twice as long to get your idea off the ground and twice the money you think it will to get your company off the ground. Unforeseen hurdles, emerging competition, market shifts and just plain old software programming delays can all cost you more time and money than you think.
Get out of the trough as fast as you can
Many companies spend a lot of their first dollars on trying to create the perfect application. While you need a valuable and viable product to start, don’t forget to find 3 to 5 reference accounts that you can go live with quickly to fuel additional sales interest. Ideally, find some high profile customers that are respected across the country. They will help you with your early legitimacy and will help you attract more like-sized companies to spin up your sales success.
Don’t forget about marketing
Many companies forget that without some brand recognition and press coverage it is going to be a LOT more difficult to start generating revenue. While a good portion of your early capital commitment has to go to product development, if you don’t spend some significant energy building brand recognition and carving out a leadership position, it is going to be MUCH more difficult to generate enough revenues to get you in a positive place before your cash runs out. There’s a reason why 9 out of 10 start-ups fail. Don’t be one of the statistics. Increase your chances of success by telling your story early and often. Companies like RE Technology.com can provide you with affordable, start-up-centric advertising packages to get you the absolute most bang for your buck.
If you need Public Relations WAV Group Communications can help. They have helped many of today’s most successful real estate technology companies make their mark in real estate and cross the chasm into greatness!
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