Newsletter September 20, 2017
Yes, You Really Care Which VCs Just Invested in Ellevest
Earlier this week, we announced that Ellevest has raised $34.6 million in our latest round of funding.
To be blunt, you may now be asking: “Hey, Ellevest, why should I care?”
Here’s why: You should care whose investment we accepted. In business, strategy matters. It stands to reason that what we’re doing matters. But I’ve learned over time that culture is everything; how we do it – how companies treat their customers and how they treat their employees – can swamp strategy.
And if culture is everything in a startup, then the backers in that startup are hugely important because they can set the pace.
The failure of culture can be front-page stuff: We’re learning more about this, in real-time, as we witness a rolling shake-out in a number of aggressive Silicon Valley companies because of their treatment of women. Culture also doesn’t have to be front-page stuff: I have one friend who sold his company sooner than he would have liked because his board was pushing him to be more aggressive, to sell more credit cards when the business was all about reducing debt (!).
At Ellevest, we want to build a business, the right way, for the long term.
So my goal was to bring in backers who care deeply about what we're doing...which means they care deeply about YOU and the impact you can have on the world when you're in financial control and living your most badass life.
I’m thrilled that our new backers include Rethink Impact, Penny Pritzker’s PSP Growth, Salesforce Ventures, and CreditEase Fintech Investment Fund. Many of our investors have a demonstrated track record of working to further the economic position of women. I’m excited to work with them and I want you to meet them, too: Here’s a video of my conversation with new Ellevest Board Director Jenny Abramson (@abramsonjenny), founder and managing partner of Rethink Impact. (Stay tuned: I’ll be back with more.)
These backers join you — whether you’re one of the tens of thousands of women in the Ellevest community or you're one of the thousands of women collectively investing tens of millions of dollars with our services — in our mission to close the gender investing gap.
Our new backers get that:
• We are trying to do something with Ellevest that is really different from the rest of the industry.
• By, for, and with women is not a marketing ploy — it’s our DNA.
• The product is not dumbed-down; it’s infused with the intelligence of the users we test with regularly.
• We are not saying we’re “for women” and then have a team and a board full of men (my personal hot button)...our leadership team is two-thirds women and our engineering and product team is just about half women.
• Women are not a “niche market.” (You wouldn’t believe how often I hear this.)
• We are in this, with you, for the long-term.
What are we using the money for? Well, firstly and frankly, to run the company. As we've tried to keep your costs low, it takes us longer to get to profitability than traditional money managers. We are using the money to extend our offerings (401k rollover, anyone?). And we’ll also begin to expand into financial planning...at your request.
Here’s to accelerating Ellevest’s work to close the gender money gaps. We look forward to continuing this journey with you, and to having our new investors join us as well.
Co-founder & CEO, Ellevest
Raising Capital from VCs: 8 Don’ts
Remember in the Season 3 premiere of Scandal, when Papa Pope reminds Olivia that she has to be twice as good to get half as much? Yeah. That’s kind of how venture capital has been working for women — and it’s even harder for women of color (hat tip: digitalundivided).
If you or any other woman you know is thinking about meeting with VCs for any reason, you deserve to read our guide on what NOT to do. From the way you talk about your business (easy on the risks), to figuring out how much money to ask for, to actually getting in front of VCs, Sallie guides you through it all. You’re welcome. Now go get your funding.
Ask Sallie: Opposites Attract Edition
This week, Sallie tells you why being different and thinking differently from your co-founder can be a good thing.
#FinancialFeminist Action of the Week: Build Your Personal Board of Directors
Fact: “It’s not what you know. It’s who you know.” (A sponsor is more valuable than a mentor after all.) Luckily for us, professional women’s groups are popping up everywhere to help us get ahead. And we hear every day about women finding jobs, board members, and even funding through these close-knit groups.
But before you join any group...be strategic. What do you want to get out of it? Where do you want to be professionally a year from now? Which of the many groups available to you will offer you resources to help you get there? For example, if you’re gunning for a raise, Ellevate Network * and Ladies Get Paid focus on helping women get the recognition — plus $$$ — we deserve. Or, if you’re tired of being the lone woman engineer at your company, Girls in Tech gets you. LinkedIn and Meetup are great places to start seeking expertise in your industry and interests. Who knows what’ll happen? And when that “who knows” comes through, share your story with us on Twitter (don’t forget to use #WhatTheElle)!
Term of the Week: Venture Capital
Or VC for short. This is money that’s invested in a privately held company in exchange for two things: An ownership stake and, ideally, a high return on investment. Because they want that ROI, venture capitalists — the individual or group who controls the money — invest in high-growth companies. The idea is that the company will either be acquired or go public, which is when the VCs make back their money and then some...if all goes according to plan.
Make Another Woman’s Payday: Astia: 5,000 Angels And Counting
Silicon Valley is known for innovating and disrupting almost every aspect of our lives...except when it comes to gender diversity apparently. That's what makes the work of Astia so important. Founded by Cate Muther in 1999, and transformed by CEO Sharon Vosmek into a massive global network of 5,000 angels since 2007, Astia's mission is simple: Get more recognition and investment for women entrepreneurs and their high-growth startups.
In 2013, the Silicon Valley-based nonprofit (yes, it accepts donations) doubled down on its mission and launched an international angel investor network, Astia Angels. To date, Astia Angels has invested $16 million in 47 women-led companies — including Ellevest. Insert exploding fist bump here.
Say It with Stats: Yes, The Venture Capital Industry Has a Woman Problem
Two percent. That little number is roughly how much VC funding women entrepreneurs received in 2016. In dollars, that turns out to be $1.46 billion for the gals and $58.2 billion for the guys. Proof that we need more VCs like Rethink Impact out there.
* Sallie Krawcheck is Chair and majority owner of Ellevate Network (the “Network”), a global professional women’s network dedicated to helping women connect, learn and invest to promote economic engagement of women worldwide.
All opinions and views expressed by Ellevest are current as of the date of this writing, for informational purposes only, and do not constitute or imply an endorsement of any third-party’s products or services.
The information provided should not be relied upon as investment advice or recommendations, does not constitute a solicitation to buy or sell securities and should not be considered specific legal, investment or tax advice.
Information was obtained from third party sources which we believe to be reliable but are not guaranteed for accuracy or completeness.
Investing entails risk including the possible loss of principal and there is no assurance that the investment will provide positive performance over any period of time.