<link href="../Styles/TWP-linebreak-stylesheet_nocolor_Updated2014.css" rel="stylesheet" type="text/css"/> <meta content="urn:uuid:38263bee-6a50-403b-8b9e-280ee7edc445" name="Adept.expected.resource"/> </head> <body> <h2>The Virtuous Circle</h2> <p class="sectiontop">Women-owned businesses show great promise, even outperforming male-owned ones. For example, women-owned businesses with more than $10 million in revenue have a growth rate 47 percent greater than all companies with revenue of $10 million and up. In the decade between 2002 to 2012, women-owned businesses have grown 28.6 percent relative to 24.4 percent increase in all business.<a href="#_ftn1" id="_ftnref1"><sup>[1]</sup></a> According to the Center for Women’s Business Research, 41 percent of private companies in the United States are owned by women, but only 3 to 5 percent of them get venture funding.<a href="#_ftn2" id="_ftnref2"><sup>[2]</sup></a> An entire cadre of organizations has risen to meet the need of evaluating women-led firms for funding and making sure they get what they deserve. Some, like Astia and Double Digit Academy, offer training; others, including Springboard and 37 Angels, focus on funding. Golden Seeds, founded in 2004, is a membership-based investor group, founded initially by women on Wall Street, which funds women-led firms. Its membership today is 80 percent women.</p> <p>Businesswoman Loretta McCarthy is the co-chair of the New York chapter of Golden Seeds—its largest. After two-plus combined decades of working as a senior level marketing executive at American Express and then Oppenheimer Funds, she said, “I really learned a huge amount about networking. Obviously much of my knowledge is about marketing, but I also learned a great deal about money management and the capital markets. Here at Golden Seeds, I’m able to combine a great deal of that because we think about how to build great companies. A lot of that is marketing, so I can bring that skill to these companies.”</p> <p>McCarthy added that during her years at those companies, “I picked up a comfort level with talking about the capital markets so that facing an investment decision for these companies is not daunting to me. And when you’re running a membership organization, which is really what this is, you spend a great deal of time thinking about how you create an environment that will make members satisfied to be here, eager to participate, willing to write checks to invest in companies, and inclined to renew year after year after year so that you build a large group of members who are doing this important work.”</p> <p>Today, Golden Seeds has more than 300 members, all of whom are investors. As she points out, women start half of the companies launched in America. “But in 2005, they were getting less than 5 percent of the capital that was being invested in new businesses. There were very few big businesses, publicly-held companies, or large growth categories like Google that were started by women. The other part of the equation was that in 2004, when we first were conceiving Golden Seeds, women were only 5 percent of the Americans who were participating in angel investing.” In 2012, that number reached 21 percent.<a href="#_ftn3" id="_ftnref3"><sup>[3]</sup></a></p> <p>Successes like this have emboldened Golden Seeds, as has the strength of the companies it has chosen to work with. McCarthy said, “We try to be as active as we can be. We currently have forty-eight companies in our portfolio. Three companies have had good exits. Five have wound down. That’s a pretty good rate.” Usually a member of Golden Seeds takes a seat on the board, which, given the organization’s overwhelmingly female membership, often added to board diversity.</p> <p class="triple">“We nearly always have one of our members occupy a board seat,” said McCarthy. “Frequently, when the companies come to us, it is the first time they created the board of directors, so it is the first time the company has had to cope with having outside people suddenly sitting at the table and giving them advice. But we also spend a fair amount of time with all companies, thinking about how we can be helpful outside of that one board representative, how we can be helpful to the company at various stages of the company’s growth. One of the most valuable assets at Golden Seeds are those 300 people who are our members, who have had long careers, and frequently are very connected. We have a lot of financial people here, but we also have marketing, social media, technology, and other expertise that we can call in even on a short time frame to help.” In other words, whether we are talking about networking, mentoring, education, or finance, the world’s virtuous circle of innovating women are stepping up to help each other.</p> <div> <hr/> <div id="ftn1"> <p class="nonindent"><a href="#_ftnref1" id="_ftn1"><sup>[1]</sup></a> “Growing Under the Radar: An Exploration of the Achievements of Million-Dollar Women-Owned Firms,” American Express OPEN, January 2013.</p> </div> <div id="ftn2"> <p class="nonindent"><a href="#_ftnref2" id="_ftn2"><sup>[2]</sup></a> Jessica Bruder, “We Need More Female Venture Capitalists,” June 30, 2010.</p> </div> <div id="ftn3"> <p class="nonindent"><a href="#_ftnref3" id="_ftn3"><sup>[3]</sup></a> Jeffrey Sohl, “The Angel Investor Market in 2012: A Moderating Recovery Continues,” Center for Venture Research, April 25, 2013.</p> </div> </div> </body> </html>