Peanut, the maker of a social networking app for women, is inward into the investing space with today’s launch of a microfund tabbed StartHER. As the name implies, the new fund will focus on investing in women as well as other historically excluded founders “of all ages, life stages, ethnicities and sexual orientations,” the visitor says. In particular, StartHER aims tackle the difficulties specific groups have in raising their first wanted — something typically referred to as the “friends and family round.”
Peanut argues there’s inherent bias in thesping that every startup founder has wangle to what are, essentially, wealthy friends or family who can spare a little startup capital. These rounds often range in size from $10,000 to as large as $150,000 or more, and can make a difference when it comes to getting a new visitor off the ground.
“The theorizing that founders should have networks worldly-wise to invest in their businesses creates an unfair starting line for most groups. If we don’t remove barriers to that initial funding by providing wangle to capital, how can we overly hope to see a waffly founder profile remoter through the fundraising funnel?” says Peanut CEO Michelle Kennedy, in a statement well-nigh the fund’s launch. “Peanut’s StartHER fund opens the door to founders looking for that early funding. It’s our opportunity to finally level the playing field. We want to be the family these founders can turn to, opening the door to our professional networks too.”
The lack of wangle to funds for sexuality founders may have gotten worse during the pandemic, as Crunchbase data indicates female-founded startups globally saw a 27% subtract in funding in 2020 as compared to 2019. The pandemic shut lanugo wangle to in-person networking opportunities and unduly impacted the family caretakers, who tend to be women, as schools, daycares and other childcare assistance businesses sealed their doors. These changes may have unsalaried to the decline, though it’s nonflexible to pinpoint.
But plane outside the pandemic’s impacts, women are underrepresented in venture investing — including on the firm’s side. Only 13% of decision-makers at VC firms are women, which can influence what startups receive funding.
“It’s no secret that the venture wanted industry is dominated by those with privilege and lucrative connections. As a member of the Sexuality Founders Fund, I’m excited to be a part of StartHER’s investment committee to help these entrepreneurs, who have not been ratherish recognized, grow their networks in the venture wanted community,” said Anu Duggal, Founding Partner of Sexuality Founders Fund, who joined SheHER’s investment committee.
StartHER says it’s looking to step in to fill that gap by offering small investments to early stage, pre-seed businesses focused on making a positive impact on society, healthcare, or the environment. According to its online application, StartHER will write checks of between $25,000 and $50,000 — likely one of the first checks a new startup may receive. The overall fund is $300,000 in size, and will make 3-4 investments in 2021. Peanut will not take an probity stake in the companies it invests in.
“Moving forward, we’ll be considering other factors such as deal spritz to help inform how we invest and the companies we segregate to invest in,” explains Kennedy. :We’re heavily focused on making the right investments that will have the most impact versus simply making returns. For StartHER, our goal is not to make X number of investments for X returns, but to diversify the VC funnel by serving as an entry point to wanted for underrepresented founders,” she says.
Along with Duggal and Kennedy, the investment committee for the fund includes femtech journalist and sweetie-pie investor Bérénice Magistretti; Chief Business Officer at Conde Nast Britain, Vanessa Kingori MBE; Founder of Shiffon Co. and Startup Girl Foundation, Shilpa Yarlagadda, and Author, Columnist and Brand Strategist, Elizabeth Uviebinene.
Applications are wonted on a rolling basis, and the committee meets every six months to consider the fund’s applications. Beyond the investment, startups who receive SheHER funds will moreover be given wangle and office hours to the networks of the committee members, the website says.