Vicki Saunders can recall exactly how she felt when she found out that only $1 in every $23 in small business loans go to women. “I was shocked, disappointed and frustrated,” she said. “As a female entrepreneur I’ve witnessed how hard it is for women to get funded, but (it was hard) to see the numbers and hear it’s literally 4 percent and hasn’t change for decades.”
In 2013, Saunders took her 25 years of experience in the startup world – as a founder of KidsNRG/The NRG Group – and founded SheEO, a Toronto-based nonprofit that helps women entrepreneurs access capital and networks for their companies located across North America and New Zealand.
Many women, when given the capital and networks, run businesses that get to profitability very quickly and are highly capital-efficient.
Saunders isn’t about just making the business playing field more fair, though. She’d like to see the system change so women benefit on a more meaningful level. “What I continue to see is people creating a female version of the existing male model, as opposed to rethinking what we’re doing,” Saunders says. She wants SheEO to help trigger a true shift, where women could “basically push the reset button and say, ‘if you’re starting over again, how would you design the model that works?”’
Saunders hopes to find that model. By leveraging her substantial network and varied experience through SheEO, she hopes to create a system where women-led businesses can do more than just keep up.
The inequality problem
Many women, when given the capital and networks, run businesses that get to profitability very quickly and are highly capital-efficient. However, Saunders discovered through her research that most funding went to companies with ambitious long-term goals, not small and medium-sized businesses. She decided to focus on female entrepreneurs who had good ideas with immediate potential.
She also wanted to focus on companies that target women – funders often pass on business ideas that target women, despite their considerable buying power as consumers. “Women made 80 percent of purchasing decisions,” says Saunders. “I looked at that information and thought, wow, there’s an instant opportunity to solve those problems.”
How she did it
As a key part of SheEO’s launch, Saunders started a program called Radical Generosity that sees 500 women who are already successful in business put $1,000 each into a pool. These donors then choose five women-led companies to loan money to, at a low rate. As the new entrepreneurs pay back those loans over five years, their payments create a perpetual fund. The original donors act as a network of mentors for the growing group of entrepreneurs they fund on an annual basis. So far, SheEO has funded 32 companies in three countries and loaned out over $3 million dollars in the last two-and-a-half years.
One venture helped by Radical Generosity is Abeego.com, a Victoria-based company producing breathable, reusable food wrap that keeps food fresher for longer. Founder Toni Desrosiers turned to SheEO after trying to get funding for eight years: she found the people writing cheques weren’t interested in her idea. “They asked her if she was going to take on Saran Wrap,” says Saunders. “Whereas every woman in our network was like, ‘Oh my god, where do I buy this?’”
Desrosiers was selected into the network in 2016 and since then revenue is up 500 percent. Now that Desroisers has not just capital, but support, Saunders thinks the sky’s the limit for the company.
Moving women forward
Unfortunately, women-focused venture programs like SheEO are rare, but there are women led VC firms, like Silicon Valley’s XFactor Ventures, that are investing in female entrepreneurs. For women seeking funds for a startup or expansion, look to those firms that have said they want to support more female business owners. “Women are sitting on a lot of capital,” says Saunders. “It’s just a matter of providing opportunities for women to invest in other women.”
Consider bootstrapping – funding your own business – too. Saunders recommends focusing on ventures that can survive on minimal startup funding and that can bring in revenue early on. Then reinvest the profits, she says.
Finally, if you’re in business, consider supporting others, especially those who might go unnoticed in the traditional business community. Saunders has built her nonprofit around this idea and her original donors are now starting to step forward to personally invest in some of the companies SheEO has funded. “The idea behind all of this,” she says, “was we’re not going to solve the problem of getting money into the hands of female entrepreneurs unless women start writing cheques.”