Opinion: VCs need to invest more in women

Amy Spurling, longtime CFO and now a CEO, believes women founders ‘need cold hard cash, not soft skills.’
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Francis Scialabba

· 5 min read

In September 2008, I finally became a CFO. Two months later, the market crashed.

The new role, and the economic crisis, threw me headfirst into operationalizing a role that had long been seen as anything but. I quickly had to become comfortable with the uncomfortable, make cuts in budget and headcount, and plan for what came next.

Over the next decade, I served as CFO three times and COO twice, which helped build the operational experience I would eventually need to convince investors. My time on a finance team at a company that sold to Yahoo! put me on the venture-backed path, and the founder vision became clearer.

But the moment I was in the CEO seat, I faced bias and discrimination. All of my prior CEOs were first-time male, white founders—it’s not like they had any more experience.

I was once told, “We like what you’re doing, but you have too much experience in this space.”

Even though female-founded companies have better returns for investors, better capital efficiency, and can have overall better performance, we’re met with dismissive and baseless comments—and the statistics on funding for female founders are alarming.

In 2021, US startups founded exclusively by women received only 2.3% of the $341 billion in venture funds, according to PitchBook. That percentage decreased in 2022 when all-women teams raised only 2.1% of VC funds. When at least one man is in the room, that number skyrockets to 16.2%. According to PitchBook, this glass ceiling has remained strong for at least the last decade.

It’s also no surprise if you look at the other side of the table: the check-writers. Women account for less than 15% of them, and we know VCs invest in founders/CEOs who look like themselves.

If VCs invested in what made them money, more women would be funded.

The impact of bias—even implicit or unconscious—goes beyond just the funding of individual businesses. It has an effect on the global economy.

Unless we do something about it.

Cash ruled everything around me (and still does)

In 2018, after years of looking for a solution that gave both finance and HR tools needed to offer personalized employee benefits that were flexible and tax-compliant, I knew it was time to build the thing myself.

Having raised more than $200 million as a CFO during my career made for a much easier transition. Building and scaling weren’t novel. But raising Compt’s angel and seed rounds were hell.

The angel was two years of operating check to check, including some of my own money. The rounds took a really long time in comparison to prior ones; I spent two years of consistent work to raise the angel round alone compared to the two or three months it typically took in previous experiences.

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One angel group met with one of our Compt executives who was pregnant and, instead of asking about her marketing strategy, only wanted to know specifics about her childcare plans. When she tried to steer the conversation back on track, she was met with more questions about parental leave and how she would balance motherhood and startup life.

As with most female founders, I was offered a lot of mentoring instead of funding. Mentoring can be great, but it’s constantly offered to female founders who are trying to get people to write checks.

To be frank, we need cold hard cash, not soft skills.

We mitigated the misogyny we were routinely met with by diversifying our investor base. Our angel round consists of nearly 50/50 male and female investors.

In 2022, we raised our Series A, backed by Battery Ventures. With that, Compt became part of the 0.9% of funding that went to female founders in Massachusetts in 2022. Between 2007 and 2018, the state ranked 46th in the country for growing women-owned businesses.

Money talks, inequitable lending walks

My combined experience as a CFO and COO prepared me for the challenges of being a female founder and CEO, especially in fundraising. And I’m working with two other women (who actually filed the bill) to take those lessons to the state house. 

Right now, a Massachusetts bill— S978/H1708—is in the works to enact fair lending laws to venture capital.

The bill aims to “extend workplace sexual harassment and gender discrimination protections to venture capital and equity investor relationships beyond traditional employer-employee, landlord-tenant relationships, or other forms of investment such as lending.”

Harassment and discrimination run rampant in the private capital industry. In a 2018 poll of hundreds of industry professionals, 80% of those surveyed said that sexual assault, harassment, and gender bias are a problem.

Local jurisdictions can offer guidance on how to implement these laws, and there are organizations like Harlem Capital (one of our investors) that are working to bridge the funding gap for underrepresented founders (because out of 892 women-founded startups that raised over $1m in 2022, 74% were founded by white women).

If the MA bill is signed, it would be illegal to abuse investor power through sexual harassment, ultimately decreasing instances of such by holding VC firms accountable, thus making it easier for women and minorities to get the funding they need and encourage business growth.

News built for finance pros

The latest news and insights corporate finance professionals need to know to keep up with their constantly evolving industry.