BlogHer|bet '11 - Closing General Session: What to do, what not to do, where to turn, and what success looks like
Closing General Session
Pattie Sellers from Fortune Magazine
Janet Riccio, EVP of Omnicom and founder of their G23 subsidiary
Kim Polese former CEO of Spikesource
Ellen Pao, Partner at Kleiner Perkins Caufield & Byers
Welcome to the BlogHer | bet ’11 Liveblog of the Closing General Session: What to do, what not to do, where to turn, and what success looks like.
Pattie Sellers: While 488 of the Fortune 500 are controlled by men, and women are leaving corporate America, many of those women are leaving to start their own companies.
One of the things we've heard today is that women really do have a hard time promoting themselves, saying why they're great. Women tend to say what their company does and why its great, but they're shy about saying why they themselves are so fabulous.
That's my first question: What is the fabulous value that you bring to this group?
I was a girl geek and worked at an AI company, and then Sun. I ran Marimba and sold it. Now I'm running a start up. When I think about what I do best, it's galvanizing a team around a mission and then driving like hell to get there and persevering along the way. You can forget how long it takes and how hard it is. To me it's one of the most exciting, rewarding and tough things about being an entrepreneur. That's what an entrepreneur has to do.
There are two things. In almost 30 years in advertising...I am the top ranking female at Omnicom. I am going to stay there and bring women up in that organization if it's the last thing I do. That's my legacy. I started a small consultancy called G23 at Omnicom and it's woken me up about the power of women and girls. I am also the beneficiary of sponsors in my life, which were all men, never women. They said I was the one that should get the job. More men get promoted because they get sponsored. We [women] get
I'm bad at self-promotion. I like to help people and help entrepreneurs.
You were in big corporate world and I sense that wasn't the best experience.
I was in a lot of companies but was frustrated with how long it took to get things done.
Ellen, what is the one thing that entrepreneurs should do or say in a pitch?
For most people it's to be excited about the product. One good example is One King's Lane [a company her firm is invested in]. They were so excited, their pitch deck looked like their site, they brought their product. They knew exactly who their customer was and had a lot of information about them.
How do you get exposure to pitches?
I don't see a lot of pitches, and we don't invest; we buy. We bought Communispace, and the CEO gave me her top ten [advice for entrepreneurs].
1. To think as hard about your business model as you do about your idea. You have to demonstrate how to make money.
I'll come back to you about the 10.
Entrepreneurs fall in love with their product and forget the context and broader market around them. Explain what you do in the context of the market around them. Don't lose site of what's going on with competitors.
You better keep your eye on competitors. If you think you're creating a new market, you probably aren't.
[Back to the top ten with Janet.]
2. VCs invest in people they know. Get an introduction.
3. Learn [didn't catch this one]
4. Net it out. A long PPT doesn't do anything. Put the 8 things you want them to walk away with on one slide.
5. Ask for honest feedback. Probe for feedback and ask to learn.
6. Don't assume it's a problem that you're a woman.
7. Don't be humble.
8. Get help.
9. Distinguish between angel and investment capital.
10. Emphasize the excitement, know your obstacles, show them your advisors.
What is the number one thing that an entrepreneur should not do in a pitch?
Don't have a convoluted business model with revenue coming from different sources. Be clear, don't explain too much, give them a clear statement that they can walk away with and explain to their partners.
Don't be without a long-term plan.
Don't be arrogant, and don't act like all you need is money. VCs want to help and know you're going to listen to them. They have invested with people they liked, even when they thought the business plan needed
You need to be forceful and personable.
You don't want to seem defensive. When VCs bring up potential problems, you don't want to say [it's not a problem.]
I talked to Jack Welch about ego, and he said the line between confidence and arrogance is curiosity. The one thing that he said was important for him was his curiosity.
I'm going to open it up right now to questions.
What should you do if you're looking for funding for a project that's for another culture?
Make sure you do something that's engaging.
Do practice pitches with friendlies in that culture and take their feedback.
Do your research and find out what they are about.
You have experience with this?
Yes. I'm wondering if you have experience with this?
There should be something for this, Pitching Other Cultures for Dummies.
I have done that, and I told them that I knew where the money was coming from in this [other] country, as opposed to my country.
My company is in social business. I'm wondering if it helps to bring along someone from your advisory board to the pitch? Does it degrade you as a CEO?
Perhaps do it if that advisor has a relationship with the VC. But I'd rather get to know the entrepreneur. That advisor may detract from the accomplishments that you've done.
Audience question (Jory Des Jardins):
You've been around a lot of men. Did you feel you had to change your style, or do something you wouldn't normally do in your pitch? To Janet, how did you get your POV across in a very male culture? And Ellen, you're always meeting with male entrepreneurs. Are you changing your style? Are the men changing their style?
I've never changed my style. I never think about [the fact that I'm a woman] unless someone points it out to me. Never change your style. The investor wants to see the real you.
I've asked myself if I had more women in my business life would I be a different woman today? I'm bawdy, I have a mouth like a sailor. I think about what I wear. But I like being a woman among men. I don't think I've ever changed, but I think I'm a different kind of woman as a result of my experience over the last 30 years.
I would say that I've had to change my style. I'm an introvert, not a self-promoter. Our firm has a lot of interrupters and I wasn't raised to be like that.
I'm going to answer this as a journalist who has covered powerful women over the years. We put these women on a pedestal and then when they fail they become targets. Every move is amplified. I like to think that what we're doing by spotlighting amazing women, and [show them as] role models for younger women. There is a theory called the "glass cliff" that companies put women in positions before they're ready. There is a
woman who was put into a position at Lehman Brothers because they thought it would be good for Wall Street, but she wasn't ready. Carly Fiorina, when I asked her about power said her power was also her weakness, a double-edged sword.
Ellen, of the pitches you see, how many come back a second time, and how many do you invest in?
We see 2000 business plans, and then we may bring up 20 for investment decision, and then we may invest in 10 or 15.
What makes or breaks a company? How many people are looking at [the plans]?
We have eight partners. A lot of it is that what is the confidence of the team, [do they] have what it takes to go after the market, is the market big enough.
Do any of you have any favorite mistakes that you have made personally that this group can relate to and that there is a lesson [to be learned]. Any "good that it wasn't you" [stories]?
One story I can say, is falling in love with your business model without seeing what's going on around you. In the case of Marimba we had to reinvent our business model several times. We had to explain our company in the context of the market. Don't be afraid to start over at zero and reassess all of your assumptions. In our case we ended up competing with IBM. We had to slow down our ambition to get to the next level. We knew we could beat IBM, but we had to reframe our company to be a little more boring. That's what we had to do to be successful.
You have to walk into the room with a few yesses or you're going to fail. I ran co-ops, and I had a failure rate that was a bit excessive. I was asked if I had gotten people to advocate for me. I learned to talk to people beforehand and get them on my side [before a presentation].
I didn't take advantage of all the opportunities in front of me, didn't ask people to coffee [because they were busy], and wish I had.
What is the one trend in technology, that you think this group needs to think about.
I don't know how applicable it is because it's a global trend: Women in developing countries are adopting technology. It speaks volumes to community and freedom and fostering connections.
The consumer credit market is completely broken and only innovation is going to help them. More regulation isn't going to fix that. I've seen some early stage companies that I'm excited about.
There is a return to accountability. In media, there is a requirement for action rather than just eyeballs.
#End of panel conversation
Sharon Vosmek, CEO of Astia:
[At Astia] we have amazing exits, and great influence in the market as it relates to women entrepreneurs. We're also part of a much larger movement as it relates to women and entrepreneurship. Jennifer Zeszut was one of our successful exits, with Scout Labs.
Jennifer Zeszut, "graduate" of Astia:
I was a first-time CEO. My story started with a billionaire [who took me to lunch] and he wrote a check. And someone told me I needed to get into Astia. And I thought it was cute that it was helping women. I was assigned to a team that helped me develop my presentation. And within 72 hours I had series B funding.
It wasn't until all of the nightmares caught up with me [that she realized she needed Astia]. That series B investment went away with the credit crunch. Then our sublet landlord wasn't paying their rent and we were locked out of our office. We had to grab as much as of our stuff as we could and make a run for the doors and overpower the security guards. And I was 9 month and two weeks pregnant.
And it's Astia that got me through this. They helped me secure funding from two solvent, good companies and we sold [Scout Labs] last summer. I made lots of little millionaires of those people that stuck with me.
I am starting another [company], and I just left my acquiring company yesterday. Astia is helping me choose [which idea to go forward with],
there are three I want to do.
You can call us a venture accelerator, you can call us a community. We're most proud of the companies that become one of our portfolio companies. We have a higher success rate than Y Combinator (a journalist told me that). The community invests in the company and makes sure they succeed.
We are a non-profit, but we have to make money. Microsoft invests in us because they want to be close to innovation. And other foundations. And the third is our clients. It's $250 to apply, $5,000 if you're in, and 1% of the company. Women don't need subsidy, they need opportunity.
Shaherose Charania, CEO of Women 2.0 and Founder Labs
Raissa B. Nebie, start-up founder, who completed a Women 2.0 Founder Labs
Founder Labs is 5 weeks, filled with highly selective people, half male and half female. They've usually done something before. There are engineers and business people. They keep their day jobs but they can't do anything else because [in all of their free time] they're working with us.
I worked in banking, went to culinary school and went to Paris. I realize I loved food but I hate being trapped in a dungeon. I moved to San Francisco because I knew there were a lot of coders.
It's hard to find a co-founder. It's harder to find a co-founder than it is to find a husband! I had an idea for a mobile app that helps you find someone to eat with. I learned [in Founder Labs] I didn't need to build the technology in order to prove it. I got out of the building and talked to people. I looked for people who loved or hated my idea, so I could learn how I could make them love it.
We pitched Dave McClure and we got funded. Online dating is broken. It
makes you look desperate. There is a stigma attached to it. You usually meet through friends and family.
We want to take away the pressure and let people meet over something they love. We curate group dinners,or you can say what you're craving and meet someone who wants to share that.
It's invitation now, but it will be subscription-based. We're starting in San Francisco [because] it's a service that appeals to city dwellers. Then we'll export it to other metro areas.
How much investment did you receive?
I can't say, but I can tell you 500 Startups invests between $50 - 100K.
What else did you learn in Founders Lab?
Never stop learning. Instead of building a prototype I put things on paper and went out and showed people the idea on paper. And I got [feedback] from people. We have close to 1000 people signed up, and we don't know who they are! We haven't marketed it. There's a big hunger for this.
This is called rapid prototyping, so you don't waste time and resources.
Test every assumption. It may seem cute and people get excited about this, but it may not actually work.
How many other people were in the lab with Raissa?
There were 20. The teams are formed organically in the first week. Not all the teams succeed, not all the teams stick together.
I got swarmed my first day so it was an easy pick. I got to choose who I wanted to work with. He [her co-founder] and I were ready to make that leap.
Jan Schaffer, Executive Director of J-Lab and J-Lab grantee
Michelle Ferrier, LocallyGrownNews.com
[To our grantees] we give $12K in startup funding and ask that they launch within 10 months. We are in the news and information space,
addressing a news and information gap. ChicksRx is one of their successes; they've raised $400K in funding. Also: Investigative Mommy Blogger,
Mobile Black History Lab, mobile app and augmented reality guide.
We've raised money from the McCormick foundation for our current RFP. April 4th is the deadline.
Michelle is one of our awardees. she has a franchise idea she is starting to roll out.
This idea came from an idea I had after I left a traditional media job and went into academia.
I talked to a lot of bloggers who were doing place blogging or hyperlocal news. And they were killing themselves. So I thought, "What if I could create a system that helped them publish and get advertising?"
I realized people needed to start small. They were usually teams of one or two people.
[Michelle plays a video that pitches the concept of LocallyGrownNews.com.]
J-lab provided some of the initial funding to get us off the ground. I've had a dual role in recruiting people to sell the idea, and developing the company. I had an epiphany: I was operating out of guilt for people
who had lost their jobs. I had to look for streams of revenue that would grow the company, not be an employment agency for out-of-work journalists. We are a content company and we syndicate content to farmers markets who need help with their marketing.
What is the criteria for the grant?
Have to be a news and information site, and you need to be in beta. And you have to launch in 10 months. We will give 4 grants this year, out of 500 proposals.
Natalia Oberti Noguera, founder of Pipeline Fund
Emma Nothmann of Booz and Company
I'm the founder of Pipeline Fund and we train women to become philanthropic investors. We created a company that helped women social entrepreneurs. It's really hard to fund these companies. It's ambiguous, the metrics are vague. There aren't really that many people who [understand] a for-profit social enterprise. The more I hung out with social entrepreneurs I realized that the funding community is mainly made up of white guys.
We soft launched last summer, and we are announcing our Pipeline Fund Fellows soon. The components are:
1) education, due diligence, term sheets,
2) mentoring, matching with most angel investors (and most are guys and we want to change the culture of the investment world),
and 3) practice.
All the fellows have to commit to $5K that they will invest in a women-led social for profit venture. we want the fellows to own the risk.
I'm a potentially different voice than [the other ones] we've heard today. I'm a management consultant, I work for Booz and Company. I've been a consultant my entire career, which is unusual. I had fallen love with education as a sector. A mentor told me to build this in Booz and Company. I was worried, but it was successful. I now run our North American education practice, and was just promoted to principal. I was the youngest person in the firm to get promoted to that level. I felt the weight of the world on my shoulders. I felt like I was winging it every day. I read an article about the Pipeline Fund. It was attactive because it was pragmatic,
and it would create a great network. I realized that at Booz and Company that only 5% of our consultants were women. I realized maybe I didn't want to be an entrepreneur on my own, but wanted to be a voice...I've told people in Booz [who have become interested and involved]. I've been tasked with creating a program that brings in more women consultants and makes sure they get mentored.
I wish we'd talked about empowering women to fail. There is a problem with women being perfectionistic. A woman might turn down an opportunity to meet with VC if she feels like her pitch is perfect. But she might get good feedback that can help. Women aren't getting funding [because] they're not pitching. [Our] Pitch Summit will be announced in the next few days.