Speaker 1: You're listening to Bloomberg Business Week with krol Messer and
Speaker 1: Tim Stenebek on Bloomberg Radio.
Speaker 2: One of the things we talk a lot about here
Speaker 2: at Bloomberg. We've done some great reporting what goes on
Speaker 2: with female founded startups. No secret that they account for
Speaker 2: only a tiny, tiny portion of the venture capital that's
Speaker 2: deployed each year. So here's some numbers for you. In
Speaker 2: twenty twenty one, for instance, female founders secured only two
Speaker 2: percent of venture capital in the US. That's according to
Speaker 2: the research firm pitchbook that follows all of this, Tim, and.
Speaker 1: That was a year that VC money really flowed. I
Speaker 1: mean twenty twenty one, those were the boom years. The
Speaker 1: last eighteen months have been a different story entirely. We've
Speaker 1: got with us right now Test name Dohadwala, founding partner
Speaker 1: of Excelstar Ventures. The VC firm says it invests in
Speaker 1: quote clear disruptive technology. They've got a lot of medtech
Speaker 1: on there, really cool stuff and really cool companies that
Speaker 1: they've invested, and they're also passionate about funding women and
Speaker 1: minority led companies. Very pleased to have test name with
Speaker 1: us this afternoon. So test name give us an idea
Speaker 1: of what you've experienced and what you've experienced working as
Speaker 1: a VC, and also what you've experienced as far as
Speaker 1: the companies that you funded. Is this a is the problem?
Speaker 1: I kind of know the answer here, but I'm still
Speaker 1: going to ask this anyway. Is the problem that only
Speaker 1: two percent of the companies are actually founded by female founders?
Speaker 3: No? I mean I think that there it's a systemic problem,
Speaker 3: and I think that the issue is that it's it's
Speaker 3: an everybody problem. It's not just a you know, the
Speaker 3: funds that are focused on investing in women. Everybody needs
Speaker 3: to work at this problem. So, for example, I know
Speaker 3: that in VC firms, only twelve percent of VC firms
Speaker 3: have women as decision makers, and sixty five percent of
Speaker 3: VC firms still don't even have a single female partner,
Speaker 3: and females are noted to be more likely to invest
Speaker 3: in female led companies. So I think that itself, we
Speaker 3: just don't have enough women investors in decision making roles
Speaker 3: investing in women. So I that's one of the issues.
Speaker 2: Testing. I want to jump in off though for a moment,
Speaker 2: because I remember Bluemberg did a story I think it
Speaker 2: was out during the pandemic, and it was even about
Speaker 2: female venture capitalists were less inclined to even invest in
Speaker 2: female founded ventures, and whether it was pressure within a
Speaker 2: firm or what have you, it's just like everyone stays away.
Speaker 2: Help me out, So go ahead, continue with your reasons why,
Speaker 2: because it's just mind blowing.
Speaker 3: So it's I think there's a little bit of well,
Speaker 3: you know, this person is experienced entrepreneur, they've had several exits. Well,
Speaker 3: if you keep investing in just experienced entrepreneurs that have
Speaker 3: had prior exits, and you're probably going to keep investing
Speaker 3: in males because a lot of female led companies are
Speaker 3: first time entrepreneurs, and you have to be willing to
Speaker 3: take a risk on a first time entrepreneur, and it
Speaker 3: may appear more risky. But I also think some of
Speaker 3: it has to do with the way we ask questions.
Speaker 3: There's been a lot of research that says that all
Speaker 3: investors ask women sort of risk mitigation type questions, and
Speaker 3: we ask men growth mindset questions. And so if you're
Speaker 3: going to change the way you ask questions to your entrepreneurs,
Speaker 3: you're going to have a different outcome in the way
Speaker 3: you perceive the company. So For example, at excel Start,
Speaker 3: we have a really structured way we do diligence, and
Speaker 3: so we make sure that we're asking same type of
Speaker 3: questions to all of our entrepreneurs. We have a quantitative
Speaker 3: and a qualitative way that we do it. We have
Speaker 3: a matrix that we fill out and a really robust report.
Speaker 3: But if you're sort of just flying by the seeder cuffs,
Speaker 3: then your own subconscious biases are going to determine what
Speaker 3: type of questions you're asking, and that changes the outcome
Speaker 3: of how you perceive the company and the opportunity that
Speaker 3: it may be that it may have.
Speaker 1: What do the data show as far as returns and
Speaker 1: who's leading companies?
Speaker 3: So I mean, if you think about the data right now,
Speaker 3: I think there's only been twenty women who have ever
Speaker 3: led a company to an IPO. And I don't think
Speaker 3: that's because women don't want to lead companies to IPOs.
Speaker 3: I think that there's a bias. One of our companies
Speaker 3: just recently was determining whether they wanted to hire a
Speaker 3: certain executive and not the CEO role, but in a
Speaker 3: very senior important role, and there was some question around
Speaker 3: whether or not that women would be able to potentially
Speaker 3: in a few years be a key management director while
Speaker 3: leading the company to an IPO, and a few not
Speaker 3: just myself, but another male board member spoke up and said, well,
Speaker 3: she we haven't even hired her. Let's get her in
Speaker 3: the door. Let's see how she does, and we'll make
Speaker 3: a decision when the time comes whether or not she'll
Speaker 3: be suited to be in the role during an IPO.
Speaker 3: So there are some assumptions that are made before women
Speaker 3: can even get into the door and make an impact
Speaker 3: in the company.
Speaker 2: So Devil's advocate a little bit because I do believe,
Speaker 2: especially in a capitalistic society, that money talks, and if
Speaker 2: there's a good business, I don't care if a monkey
Speaker 2: or a frog is running it, like people are going
Speaker 2: to invest in it. Is there something else that's missing
Speaker 2: that just I mean, look at the creator of spanks.
Speaker 2: She created a billion dollar business like people women create,
Speaker 2: you know, Kardashians like whatever, go everywhere you want, Like
Speaker 2: people create billion dollar Oprah, like people create women specifically
Speaker 2: create successful businesses. But I'm just I'm wondering if there's
Speaker 2: something else missing in the trajectory that doesn't allow women
Speaker 2: to take their ideas and really run with it or
Speaker 2: attract again the investors that ultimately create a female run
Speaker 2: Google alphabet a female run Tesla. You know what I mean?
Speaker 3: Well, I think that I do think that there are
Speaker 3: a female I think a lot of female. When you
Speaker 3: think about entrepreneurs, a lot of them are thinking about
Speaker 3: what is in their realm of expertise or what have
Speaker 3: they experience in life that drives them to found a
Speaker 3: certain company. Right, So, if a female is finding founding
Speaker 3: a company based on the female experience and she's pitching
Speaker 3: it to male venture partners, there is a possibility that
Speaker 3: isn't going to resonate, and we have to look we
Speaker 3: have to look at the reality that we're faced with.
Speaker 3: If you're if the decision makers are going to be
Speaker 3: men and they're the ones who are you know, owning
Speaker 3: the lion's share of investment dollars, then you have to
Speaker 3: I'm not telling you to change your idea. What I'm
Speaker 3: suggesting is that you people need to be aware. Women
Speaker 3: need to be aware of these biases and then adjust
Speaker 3: their pitch such that it may still be a wonderful
Speaker 3: opportunity based on the male experience, but they need to
Speaker 3: make sure that they present it in a way that
Speaker 3: resonates with their male counterpart. Not everything about the female
Speaker 3: experience will resonate with males, and so you have to
Speaker 3: perhaps adjust your pitch. Think about how you know, how
Speaker 3: are you doing the market sizing, What are you talking
Speaker 3: about exits? Do you have enough exit potentials? A lot
Speaker 3: of times, for example, if in a women's health company,
Speaker 3: whether we like this or not, in med tech, there
Speaker 3: aren't that many large medtech players that have sizeable women's
Speaker 3: health divisions, right, and so if you have a women's
Speaker 3: health medtech company, but you don't have perhaps a very
Speaker 3: distinct way of exiting to a sizable acquirer that shows
Speaker 3: an acquisitive nature, then investor is going to push back
Speaker 3: on that.
Speaker 2: So I go ahead, no that' no no, no, no, no, no,
Speaker 2: you're saying really smart things. I guess that I'm just
Speaker 2: thinking again, I'm playing Devil's advocate. Like if Mark Zuckerberg
Speaker 2: had been Maria Zuckerberg and she created Facebook? Would would
Speaker 2: she have gotten the money to create Facebook? Now?
Speaker 3: Meta? I don't know, because I do see some of
Speaker 3: our female entrepren and they are fab many of them,
Speaker 3: I mean, some of them have issues just like our
Speaker 3: male entrepreneurs do. But I just find that females also
Speaker 3: don't have as much of a network. I don't know
Speaker 3: if it's the sort of that old boys network that
Speaker 3: continues to prevail, but they just don't seem to know
Speaker 3: enough investors. And I also find them that they're not
Speaker 3: as assertive with their investors and asking for introductions. So
Speaker 3: only my male for example, when we're sitting in the
Speaker 3: board and we're sort of, well, I have this company
Speaker 3: and we're experiencing XYZ, this could be helpful. These are
Speaker 3: why my thoughts are this, and I'm giving advice to
Speaker 3: a company. Most of the time my male CEOs will say, hey,
Speaker 3: can you introduce me to that CEO so I can
Speaker 3: learn a little bit more about you know, what you're
Speaker 3: talking about, so I can really understand whether it be
Speaker 3: clinical design or you know, acquiring customers something another company.
Speaker 3: It's very rare that a female will proactively ask me.
Speaker 3: It happens, but you will proactively ask me to make
Speaker 3: introductions for them I have to offer. I will go
Speaker 3: back and look at my rolodex and say who can
Speaker 3: I introduce you to? But they will not proactively ask me,
Speaker 3: as an investor to make introductions for them, which I
Speaker 3: I have some, but that makes a big difference.
Speaker 2: We're gonna let the guy wait. The guy in the
Speaker 2: room want to say, I.
Speaker 1: Just want to ask a question quick. I just want
Speaker 1: to ask a question, Okay, And just you know one phrase.
Speaker 1: The most exciting area you're investing in right.
Speaker 3: Now, ooh, personalizable tailored medtech companies that function very much
Speaker 3: like therapeutics, and their functionality is able to basically shift
Speaker 3: and conform to the anatomy of our human bodies and
Speaker 3: able to really create therapy in a way that only
Speaker 3: therapeutics have been able to do in the past.
Speaker 2: I have to say, I have a niece who's a doctor,
Speaker 2: and she's a good friend that has doctor do and
Speaker 2: they say, it's amazing, like the differences of things that
Speaker 2: aren't done for women in healthcare and medical devices. I'll
Speaker 2: talk to you about it, but it's just the perspective
Speaker 2: of and things that are covered by insurance for men
Speaker 2: versus women. And just Matt talked about it with breastfeeding
Speaker 2: for his wife specifically, and just things you know that
Speaker 2: come problems and stuff that you know there isn't research
Speaker 2: followed for women. So you make such a valid point,
Speaker 2: and you think about the in roads. And I also
Speaker 2: think about if this money isn't going to these companies,
Speaker 2: women who are starting companies like you, think about it,
Speaker 2: if they were allowed to run with it, what kind
Speaker 2: of businesses they would create? What that would mean for
Speaker 2: you know, public companies, market caps, economic momentum, right, job hiring, Like,
Speaker 2: how much we are ignoring at this point.
Speaker 3: There is actually a company that I know that would
Speaker 3: have been a fabulous company, would have changed the trajectory
Speaker 3: of a disease that we all struggle with as women.
Speaker 3: And unfortunately, because the Acquirer spun off their women's health division,
Speaker 3: the technology was shelved, even after they paid a lot
Speaker 3: of money for it, and never made it to market.
Speaker 3: It's really sad.
Speaker 2: That's amazing. That's amazing. Hey, listen, incredible stuff. Come back soon.
Speaker 2: We'd love to continue this conversation with you. I really
Speaker 2: feel like this was a very productive one because I
Speaker 2: feel like it's a topic we've talked about for years,
Speaker 2: but you really got to some of the core of
Speaker 2: the problems. Tusney Doha Dwala, she's founding partner at Excelstar Ventures,
Speaker 2: joining us on Zoom from Boston, really cool conversation.
Speaker 1: Yeah, a lot of cool companies they've invested in. No,
Speaker 1: but data, augmenics and more. This is Bloomberg