Manica Blain is a venture partner at BrandProject, where she invests in early-stage consumer businesses in Canada and the United States.
In 2014, only 4.8 per cent of all Fortune 500 companies were led by female CEOs, and Indra Nooyi, then-CEO of Pepsi, said about women pursuing both career and family: “The biological clock and the career clock are in total conflict with each other … you have to co-opt a lot of people to help you. … We plan our lives meticulously so we can be decent parents.”
Around this time, I was swapping my career in private equity at Onex to pursue one in venture capital, focusing on the consumer and retail sectors. At first blush, VC was the Wild West compared with where I’d come from – investment banking, and then private equity – however, I was compelled by the growing number of celebrated female VC leaders who I believed could be forces of change in the world of commerce. Trailblazers such as Kirsten Green of Forerunner Ventures and Aileen Lee of Kleiner Perkins and then Cowboy Ventures were attracting further female participation in VC, increasing investments in women-led businesses, and encouraging female founders to pursue funding. With more Kirstens and Aileens investing at the earliest stage of a company’s life cycle, the VC industry could cultivate more female leaders – more Indras – at the Fortune 500 level.
Investing in founders as they were building the next big consumer brands was a dream job, and I was particularly excited about backing women. One of my first investments was in Los Angeles-based FIGS, a purpose-led apparel disruptor for medical professionals founded by Heather Hasson and Trina Spear. FIGS has become one of the most successful online direct-to-consumer brands, growing to sales of US$263-million last year from US$3-million in 2016, and currently pursuing an initial public offering. Several venture-backed female founders have also started families while creating substantial returns for their investors, such as Katrina Lake of U.S.-based apparel styling company Stitch Fix and Whitney Wolfe Herd of U.S. social-media and dating app company Bumble. Both founder/CEOs held their young toddlers while celebrating their companies’ IPOs. And finally, within my current firm, BrandProject, an early-stage consumer-focused VC fund, meal-delivery service Daily Harvest is one of our top-performing portfolio companies. Founder Rachel Drori was a new mom when BrandProject first invested in her startup in 2016, and she had her second child as she closed her next round of funding a year later. By December, 2020, Ms. Drori publicly reported her business was on track to do US$250-million in annual sales, growing at a compounded annual rate of more than 150 per cent since 2016.
Yet despite these success stories, there continues to be an aversion in backing female founders, and rife inequalities continue to persist in our community. Harvard Business Review and AllRaise recently reported only 2.3 per cent of total capital invested in venture-backed startups went to female founders in the past year.
Venture capitalists don’t deny this prevailing inequity, but few state their reasons for not backing female founders. When a fellow investor recently recounted a discussion within her firm on why it was “tough” to invest in women who are likely to start families soon, I welcomed the candour. Specifically, the apprehension was rooted in the belief that at the earliest stage of a company’s life cycle, the founder is pivotal to success, and there was no way of knowing if a founder was planning to take time off, how much, and what the implications could be for a key team member stepping away to give birth and then care for their baby in the first year, and beyond.
As a female investor who also happens to be eight months pregnant with her second child, my initial reaction was disappointment, but I was equally relieved that someone else recognized the obvious discrimination. It seems as though we haven’t moved on from the conversation women in the industry were having seven years ago when I entered the VC sector, but at least we are being honest.
So how do we address these concerns, and what needs to change if we want to move toward a more equitable world?
We need more transparency. Rather than automatically seeing a pregnant founder (or potentially soon-to-be-pregnant founder) as a risk or concern, I challenge my VC peers to engage in open conversations. In the case of Joanna Griffiths, the founder and CEO of Toronto-based women’s apparel company Knix, who closed $53-million in March, mere days before delivering her twins, she had her own set of conditions. She would automatically rule out any investors who raised concerns around her dedication to her business because she was pregnant – and, as a result, a small number of prospective investors were disqualified from bidding.
I believe a culture of transparency and a resetting of rules needs to start within the walls of our own VC firms and with our own incoming female leaders. There is a strong reluctance around asking a woman what her plans are if she’s pregnant, or if she becomes pregnant. I believe we are doing more harm by not engaging in early conversations with our leaders around parental leave directly, regardless of gender.
Why? Because having a baby is, in most instances, a very intentional act. A leader will face any number of life events and challenges – and many won’t come with nine months of lead time. By not openly discussing a woman’s plans around building a family, we risk perpetuating the bias and presumption that women can’t successfully navigate the challenge of starting a family while continuing to build their careers.
When I considered joining BrandProject’s team I was eight weeks pregnant, and initially I struggled with disclosing that fact. Women in my network cautioned me against sharing my pregnancy news – partly because of the risk of miscarriage early on – but, primarily because my potential partners might be deterred from bringing me onto a small team to co-lead investing efforts. Despite the perceived risk, I ended up being transparent with Andrew Black, founder of BrandProject. I approached our conversations from a partnership perspective, with solutions and a potential framework that could work for us both, and in return, he was open and flexible. He knew plans could change, our team was adaptable and could find ways to bridge gaps, and bringing me on board was a long-term move with addressable short-term challenges. I could even transition into a more permanent role by first joining as a venture partner. It was a great outcome, and I know I’m privileged to have forward-thinking partners who support both my personal and career goals.
This is the kind of relationship and partnership I believe the best investors should strive to have with the founders they back – one based on transparency, openness and willingness to collaborate to find solutions as financially aligned counterparties. And I think it starts with how investors treat partners, and potential incoming partners, within their own VC firms.
For more perspectives, I turned to other investors in my network who have been pregnant while operating at funds. “It may be impossible to plan for some aspects of pregnancy and motherhood, but at the very least we need to engage in conversations openly,” said Laura Lenz, a partner at OMERS Ventures, and mom to three. “Pregnancy and the ability to integrate motherhood into a career shouldn’t be a topic that’s off-limits. It’s easier said than done, though, when data from AllRaise shows that 64 per cent of funds don’t even have a single female partner.”
Christina Farr, who recently joined OMERS Ventures as a principal investor, and is currently on parental leave, said of her recent experience: “There isn’t much out there about how to operate in VC or start companies while pregnant. Very few female execs share their stories. But that’s starting to change. We need to see examples of people taking real time off, without it impacting their career trajectory. It’s one of the reasons I am being so vocal about my own experience.”
More openness in conversations with incoming female Partners at VC firms will result in more female decision makers, and this will result in more VC dollars being deployed to female founders. Since joining BrandProject in January, I’ve closed two investments, one of which is in a female founder – so I’m hitting 50 per cent so far, which I’m proud to say is on par with BrandProject’s overall track record, where 13 of our 25 investments have been in female founder-led teams.
“If we want to attract and retain amazing talent, we need to be mindful of the demands on people’s time as they move through life cycles,” Mr. Black says. “Whether it’s the demands of raising a young family, elder care challenges, illness and mental-health challenges. We need to be mindful of all of these circumstances and be flexible and make accommodations to ensure that people are valued and that they can contribute to their fullest potential. The VC industry has been a laggard and I think we have an opportunity to make meaningful change.”
If COVID has taught us anything, it’s that we can adapt to new ways of doing business when we need to. We’ve all been working from home, we’ve all had our personal and professional lives collide and we’re still getting it done. In fact, I think we’re more productive today working flexibly and remotely than we were working in a more traditional capacity more than a year ago – or at least I am, as a working new mom of one, with another on the way. Transparency in conversations around life events, coupled with this new flexible way in how we work, should cultivate more female leaders in commerce. Last year marked more women CEOs of Fortune 500 companies than ever before, but the numbers are still low, with only 8 per cent of all Fortune 500 companies currently led by women. We’ve still got a long way to go, but we’re moving in the right direction from where we were in 2014.
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