Why more women should invest in startups and three ways you can get started
As I think more about the investment climate we are in — a total of 35000 startups are being created, a total of number of dollars newly…
As I think more about the investment climate we are in — a total of 35000 startups are being created, a total of number of dollars newly being flushed into investment dollars, women are being left behind in the wealth creation equation.
This podcast by Naval Ravikant, titled “How to Get Rich without getting lucky” is one of the more insightful podcasts in the recent past and he makes a few effective points on how to create wealth. Wealth creation should not be the prerogative of the handful that have some insider insights. Wealth creation is mostly about assets that continue to earn while you sleep and most effective way is to continue to invest.
The benefits of compound interest is a valuable lesson that every one of us can benefit from. If you want to double your money, the rule of 72 shows you how to do so in about seven years without taking on too much risk. The difference in trying to double your money through regular investments that require at least a 5% interest rate requires you to do some portfolio management and balancing your risk and returns.
But my interest in getting more women to invest in startups is to develop a better risk appetite, and also invest in those non-traditional opportunities that most male investors may miss out on. A few years ago, a fashion company founder was introduced to me. Let’s call her Rose for the sake of the story. She was the founder of an interesting startup that wanted to use someone’s psychology to identify what clothes they were more likely to purchase. I liked the grit of the founder, her technical chops and the overall insights and believed that the company would be successful. At that time, I did not have access to crowdfunding platforms such as Angellist and tried to help the founder out by introducing her to my more affluent and successful investor friends who happened to be 95% male. Sure enough, none of them took even a glance at the deal and passed. Almost 9 months later, true to her grit, the founder raised a sizable round from a notable venture fund.
Why does this matter?
I believe that the power of influence in this world is directly correlated to wealth creation, social capital and having a voice. Investing in startups that you believe in is a great first step. If you like me, believe that startups are the future of our innovation, then investing in the right companies will give you access to the right types of founders, types of ideas and hopefully, the ability to invest in the more riskier equity types that most women are averse to invest in. So how can you get involved:
Become an accredited investor on platforms such as Angellist. Find investments and invest! Some of them let you come in at small amounts such as a thousand dollars. ($1000). Its a low risk way of getting your feet wet. Talk to me if you want to learn more. I am @yrdeepika on twitter or deepika at solveforxx dot com.
Find opportunities to invest in your friends companies. Most founders who are friendly will accept small sums of money, to allow their friends to get involved in their journeys.
If you believe in a product that you like and you are part of the company that builds that great product, then use your job opportunity as an opportunity to invest into your company.
Big shout out to early female investors, Angellist and entrepreneurs who are willing to open their doors to more female investors and bring them along for this ride.
Full Disclosure — I invest through a syndicate on Angellist (solveforxx) in early stage startups focused on the female buying power.