Plotting a path towards growth and success can be especially tough for women-owned startups.
On the Startup Success podcast, we recently sat down with Virginia Almendarez. She’s a startup coach and Senior Entrepreneur Success Manager at IFundWomen, an organization that is doing incredible work to support and coach women-owned startups.
During our conversation, Virginia identified three unique challenges women entrepreneurs face:
- Finding capital
Every startup sees funding as a challenge, but for women-owned startups, it’s magnified. In 2019, women-owned startups received only 2.8% of venture capital paid out that year. In 2020, that number went down to 2.3%. - Finding a coach or mentor
Women have reported difficulty in finding someone they can turn to for advice or coaching who has been through the startup process before. - Finding a community
In addition, it is not always a simple task for women to connect with a community of people who understand the process and can empathize with the inherent challenges of building a startup.
These challenges can be intimidating, but Virginia has some tips to help women entrepreneurs gain the confidence and support necessary to achieve success in the startup space.
Tips for Women Entrepreneurs
Making the Ask
Asking for funding is a skill that startup owners need throughout their entrepreneurial journey. The more practice you get campaigning for funding, the quicker you will scale your business.
But depending on your skills and strengths, making the ask for funding can be one of the most anxiety-inducing aspects of building a startup.
According to Virginia, entrepreneurs can compound that anxiety with a desire to avoid disappointment. It can feel like a lot is on the line when you put yourself out there. To avoid that feeling, some go in with a self-defeating attitude.
When you go in doubting yourself and doubting that you’ll ever receive the amount of money you need and deserve to fund your startup, you end up making the decision for the potential funder. Instead, make the ask without any editorializing and let them decide for themselves.
For some, there is a stigma against asking for support. To them, it might feel like a handout. But as Virginia says, “We can’t do everything by ourselves.”
It helps to change your mindset. Don’t get caught up thinking about your business as an extension of you. Your mindset should be that you are creating a business to solve a problem. It has nothing to do with you and everything to do with the problem you are solving.
Changing your mindset will make the ask less personal and more manageable.
“When in doubt, focus out. It’s really not about you. It’s about what you’re bringing to the market and how you’re making someone’s life better.”
— Virginia Almendarez, IFundWomen
Honing Your Pitch
To hone your pitch, Virginia recommends answering these three questions:
- What problem are you solving?
- How are you solving it?
- Who is your target audience?
Now the most important step: condense those answers into two sentences.
It’s a difficult task for some. Understandably, if you’re pitching something you’re passionate about, you may have a tendency to go on and on. But attention spans are short, and there just isn’t time or patience for that.
You want the pitch to be compelling and enticing enough that your audience says, “Okay, I’m interested, tell me more.”
“With the rise of virtual networking, it’s very important to really have your communication succinct and concise now.”
— Virginia Almendarez, IFundWomen
Startup Trends in 2021
Crowdfunding
In recent years, crowdfunding has gained a lot of visibility, and Virginia expects that to continue in 2021. Like so many crises that came before it, the pandemic has led to innovations in where businesses look for funding.
“People are discovering that there are additional innovative ways to raise money to scale their businesses than just the one equity funder route.”
— Virginia Almendarez, IFundWomen
Businesses don’t have to go down the one equity funder route now that there are so many different sources for funding. And an added bonus of multiple sources of funding is startup founders can maintain ownership of their company.
In many ways, crowdfunding is a necessary step in the startup journey. Many early-stage startups think that they’ll get that venture capital right out of the gate. But the truth is that you need to prove traction before you get to that point.
Investors need to see that you’ve done an angel round, or raised money from family and friends, or raised money through crowdfunding. It builds your base and provides proof that the demand exists for your product or service.
Authentic Connections
Building authentic connections with your supporters and potential customers will continue to be important.
“It’s not just about the product, it’s not just about the service, but how in touch you are with everything else that’s going on around you.”
— Virginia Almendarez, IFundWomen
Virginia says building authentic connections is about being true to who you are and to the relationship you’ve built with your target audience. Businesses need to come from a place of caring. If you want to connect, it’s time to make a real impact in the lives of your customers.
This discussion with Virginia Almendarez was taken from our Startup Success podcast. You can listen to the full episode here and browse all our podcasts here.