You have a brilliant business idea. You’ve done your homework and you feel there is a genuine need. The only problem, how do you obtain seed money to get your idea off the ground? Depending on the type of business, you will need office space, furniture, equipment, supplies, and cash on hand to pay yourself and any employees.
Traditionally, women entrepreneurs have depended on savings, loans from family or friends, and/or bank loans. A possible source of funding that women seem to be overlooking is venture capitalism. There is a growing number of venture capital firms (VC’s) looking to invest, with the expectations of reaping a larger return than could be earned in more traditional investments. You most frequently hear about VC’s investing in dotcoms, however, they invest in other businesses, as well. And, we’re talking about upwards of hundreds of millions of dollars that are available. In a recent Forbes articles, Julia Pimsleur, states “There is more Venture and Angel money being invested than ever – in 2013 alone $29B in Venture and $25B in Angel.”
How does it work? Basically, a venture capital firm will open a fund, i.e. a pool of money, to be invested in certain companies that fit the firm’s investment profile—which could be a biotech startup, dot com or other high technology companies, or they might choose to invest in a mix of companies. Not all of the investment companies will make it, some will fail, but the ones that do pan out, make it worthwhile for investors. You can read the article, How Does Venture Capital Work, to gather more information.
Any entrepreneur hoping to get funded has to have a business idea that sparks the interest of investors. To go after this funding, one must be aggressive, thick skinned, and prepared to be scrutinized. And, since women are underrepresented, we must be ready to jump, fearlessly, into an arena dominated by males.
Julia Pimsleur further wonders, “Why are so few women entrepreneurs pursuing Venture Capital and when they do, why is their success rate so low? In the U.S. women founders own 30% of all businesses but receive only 13% of the Venture Capital “rocket fuel” that flow into companies each year.”
So, what do you think? Are women downgrading their dreams and ideas due to a lack of resources?
If this is you; but you feel you may have the next million dollar idea, realize that with the right vision and guts, there may be venture capitalists ready to take you on!
Image courtesy of freedigitalphotos.net/”hand giving money to other hand” by creativedoxfoto.
Regina Essel is a Life-Empowerment and Business Coach/Consultant. She is also Founder and Administrator of the (Free to Join) Savvy Empowered Women’s Network. Connect with Regina at www.reginaessel.com , www.savvyewn.com, www.twitter.com/savvyewn, www.facebook.com/savvyewn, and www.linkedin.com/in/reginaessel.