Women entrepreneurs face a distinct set of challenges. Want to raise money for your business? You’re most likely going to have to pitch to a table of white male investors. Want to hire female engineers and coders to make your staff more gender-balanced? Women are leaving those career paths in droves. Want to build a network of mentors and peers to help your company scale and grow? There’s still a shortage of role models and networks for female founders to call on.
Karen Cohn thinks she’s found a way to change all of that.
“I’ve always been manic about the female economy,” Cohn told the Cut on a phone call yesterday. She’d just launched iFundWomen, her new crowdfunding platform for campaigns by female founders and entrepreneurs. “There is such a massive funding gap for women in venture. It’s a little-known fact that women only get about 2 to 6 percent of venture dollars. We knew we had to do something about that.”
The idea for iFundWomen got its start over the summer: Cohn and her team of three other women, Sarah Sommers, Kate Anderson, and Shilpa Raut, had decided to launch a female-driven video-content platform akin to YouTube called VProud. They knew that crowdfunding would be their best avenue for success. “We were late to the Kickstarter game,” Cohn says, “but we funded our first campaign in three months … and I’m old!”
Crowdfunding as an idea has — for lack of a better word — disrupted our understanding of what launching a business should look like. (In 2012, Obama even made crowdfunding part of the JOBS Act, the first time the term had made it into official legislature.) Cohn maintains that even still, many people don’t know what crowdfunding is. Some of the women who reached out to Cohn in the initial stages of iFundWomen, which was inspired by her success funding VProud, said they hadn’t even considered crowdfunding as an option for getting their businesses off the ground. “We got 200 applications in the span of a month,” she said. “I was shocked because I knew that there was a need, but I didn’t realize it was that desperate.”
But if Cohn and co. had found success for their own company on Kickstarter, why was it necessary to start a separate crowdfunding platform only for women? A study from the University of Pennsylvania released this July found that of 61,654 successfully funded Kickstarter campaigns that raised over $1,000, 41 percent of them were created by women. Was there something that Kickstarter (or Indiegogo, GoFundMe, or the several other platforms that came about in the wake of Kickstarter’s monolithic success) wasn’t doing to make raising money easier for female founders?
Cohn believes so: “We need coaching, we need video-production services, we need a community, we need women encouraging other women. So many of us don’t have access to Silicon Valley VCs and the white dudes who run the show.” That’s one of the reasons that iFundWomen comes built in with free crowdfunding coaching — “Before you submit your application, we will get on the phone with you and talk about where you are, what your business is, what you’re trying to do” — and consultations on creators’ videos, a key component to launching a successful crowdfunding campaign. “We want it to be a process where we really care. And we want to make sure we’re elevating qualified entrepreneurs.”
Recently we’ve seen a lot of start-ups catering specifically to women, a point raised with Cohn. Is there a risk of fatigue? Cohn says she isn’t worried. Instead, she says, she’s focused on reaching as many female entrepreneurs as she can. “I want to go into rural areas and do meet-ups. How do we get the word out there to places that are not New York and the Valley?” And she plans to stay committed to her lifelong mission. “I’m all about women getting paid for their work,” she adds. “That’s been my life’s work.”
The big difference between Kickstarter and iFundWomen is the integration of a “Pay It Forward” model. “We directly reinvest 20 percent of our fees into live campaigns on the site,” Cohn explained. “We wrote a simple algorithm that predicts if a crowdfunding campaign is going to be successful or not, and we’re going to invest money into the ones that are close enough to make it. We want to put these projects over the edge.” Like Kickstarter, iFundWomen takes a 5 percent cut, which rounds up to about 8 percent with credit-card fees.