Before founding Ellevest, I thought long and hard about how to create a sustainable business by, for, and — above all — with women.
And one of the first ways I knew I could do it “right” was by having the right backers. That’s why I can’t wait to introduce you to Jenny Abramson, the founder and managing partner of Rethink Impact (@rethinkimpact).
Jenny is a tech CEO-turned-VC who has a big vision for investing in startups, including companies that traditional venture capital firms have typically overlooked. She and I sat down in Washington, D.C. to talk shop, from the inspiration she got from her mother to why investing in women — including Ellevest — is good business.
Your mother ran a venture capital firm, Women's Growth Capital. How did she have an influence on what you're doing?
I actually remember being a kid and seeing a magazine with my mom on the cover with a cigar superimposed in her mouth, sort of making fun of a woman in a man's world.
It meant something to me then, but to be honest, by the time I had finished school and I had been with these incredible women at Stanford and business school and in various jobs, I sort of naïvely thought the gender stuff was no longer an issue. It wasn't until I moved into the tech sector and was a CEO that I kept finding myself as the only female in a given room or on the stage, and started to look into the data — and realized just how much it was an issue. When my mom was investing 20 plus years ago, women got 2.5% of all venture capital dollars, and today, women get less than that.
This is despite incredible data on performance. So I was inspired by the business opportunity [and] to finish the work my mom had started.
When you go and have dinner with your mom, what does she say to you, given that you're following in her footsteps?
She is both very excited but also a little annoyed that the world hasn't changed faster. [She] feels like it's crazy that I'm up there at various conferences or other places or at South by Southwest talking about the very things that were being talked about 25 years ago: that so little capital is still going to women today.
I think it's striking to her that there's such a gender imbalance within venture capital, that my partner, Heidi Patel, and I are among the fewer than 6% of all investment decision makers [who are] women. That number is down from 10%. So, on the one hand, she's very excited, and on the other hand, there's some frustration.
Tell us a little bit about why you founded Rethink.
I founded Rethink to try to tackle two things. One, these gender issues and getting more capital to women. Two, to work on the social impact issues I'd always cared about — and leverage the private sector; gather skills, talent, or capital; and bring real money to bear.
We raised a fund — that ended up being the largest impact fund with a gender lens in the country — to really be able to support incredible gender diversity and work on the world's greatest challenges.*
So we’ve hit on this a little bit, but let’s hit it again: Venture capital has a women problem. How would you describe it?
I think people all know that there's an imbalance in venture capital, and I think what's shocking to them is when they hear just how striking the numbers are. My partner, Heidi, and I are among the fewer than 6% of venture capitalists who are women, who are making investment decisions — [that] is a pretty low number.*
And I think what's so amazing about [venture capital’s gender funding gap] is that this isn’t just a female issue. This is an issue that’s a business opportunity.
Why do you care so deeply about closing the venture capital gender funding gap?
Money is power and at the end of the day, if we want to change the dynamics both on the gender side, as well as with social issues, you need money to be brought to the table.
Having real capital and real tech and real talent focused on the world's greatest problems and human sustainable development goals — whether in education, healthcare, economic empowerment for women and for others, or environment — the best way to do it, or at least one critical component of doing it, is through funding.
Why do you believe other people — business people, the general public, men — should also care?
Investing in women is good business. We know that the returns are stronger in businesses that have a female on the management team. We know that it's a good business opportunity. So they should care first and foremost for that reason.
Second, it's good for the economy, right? If women had full parity in the workforce, global GDP by 2025 would be 26% higher.
I think that that makes sense for everybody.
All right, so what advice do you have for women who are trying to get comfortable talking about their financial futures and money?
I think I'd say I have two pieces of advice for women trying to get comfortable talking about their financial future and money. One would be data. I'm a data nerd. I love data. Bring data to the table. Come with a quantitative case if you're thinking about a raise or you're thinking about an ask.
And the second I would say is invest, right? The average female investor has 71% of her money in cash, and that puts her in a very bad situation for retirement compared to her male counterparts. It's not just about what you make and what raises you get; while that's critical, it's also what do you do with that money to set yourself up for your future?
What excites you about Ellevest?I love that Ellevest is tackling an incredible gender issue that many haven't tackled, which is women and investing. Two-thirds of wealth in this country is going to be controlled by women by 2030, so this is an incredible business opportunity and incredible social opportunity. When you couple that with a team that has financial services experience, tech experience, and just an amazing leader in you, Sallie, it's an honor to be able to support Ellevest.
This interview has been edited and condensed for clarity.
According to B Lab, as of March 1, 2017
According to B Lab, as of March 1, 2017
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