Where should you focus your fundraising efforts?
It’s important you understand the difference between an angel investor and a venture capitalist investor.
Venture capitalists and angel investors are vastly different.
Angel investors are not responsible for investing on behalf of anyone but themselves (save maybe spouses or family members). Whereas, VCs are investing on behalf of groups of investors and funds and invest later on in a startup’s development.
Specifically, when we talk about the investment bias against womxn and minorities, we aren’t distinguishing between angel and venture capital. Most people just use the blanket term “VC.”
But the distinction is crucial to the conversation.
Why?
Angels invest earlier in startups than VCs.
Almost every womxn founder I’ve talked to wishes to build their business without outside investment. Though, they see it as necessary.
We also know womxn founded companies tend to be really capital-efficient, and are, long term, more successful than venture-backed companies led by men.
Do womxn founders NEED or WANT VCs?
If we had the distinction between the types of investment in our reporting, we’d be able to see how many womxn raise an angel round but do not raise a VC round.
The bias is there, but perhaps womxn don’t need or want the money either.
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