Bonfire Firestarter Series: FundRaising as a Woman


Jennifer Richard


March 30, 2021

At the end of February, we hosted our very first Firestarters ecosystem event titled “A Fireside Chat on Fundraising as a Woman” to kick off Women’s History Month. Now, as we look to wrap up Women’s History Month, I’d like to share the insights we gained from our phenomenal speakers - Melanie Fellay (Co-founder and CEO, Spekit), Christina Ross (Co-founder & CEO, Cube), and Mallun Yen (Founding Partner, Operator Collective).

The genesis for the event came from the recent diversity statistics that have been published for women receiving VC funding. Back in 2019, fundraising stats for companies with all women-founding teams were at an “all-time high” of 2.8%. However, once the pandemic hit, this momentum reversed with the number shrinking to 2.2%. What’s most alarming about these statistics is that the regression of progress came at a time when the market was exceptionally frothy. In fact, VC investments topped $150B for the first time last year.

At Bonfire, we are leaning into this conversation because we want to understand the “why” and amplify ourselves as check writers for awesome women founders raising seed rounds in B2B software. In fact, it has been difficult for us to make sense of the disparity since we have several women founders in our portfolio who have defied these dismal statistics by building stellar companies and then crushing it on the fundraising trail. And of course, we’ve done so with the assistance of awesome co-investors like Mallun, who has broken the mold to raise one of the hottest new funds in our domain. This is equally impressive given that women raising money for their companies is only part of the issue. Women raising money for their funds is just as bad given that only 2.4% of founding partners at VC funds are women.

I have included (if you don’t have time to watch the full video) what I see as the key excerpts and takeaways from the amazing event. We look forward to continuing this conversation and moving the needle forward towards change.

We’ve seen the dismal data come out around women being able to raise venture capital in tandem with women like Whitney Wolfe Herd ringing the bell at Bumble’s IPO with a baby in tow. What do we make of this? Is progress being made?

Mallun:  I’m incredibly encouraged. I’m more optimistic now than I’ve ever been because change is happening now and it’s happening at all levels and it’s not just the women who are talking about it. When you have more funders with different networks than the typical dominant, homogenous group you start to see the trickle-down effect even though diversity is not necessarily the focus.

In B2B software we see fewer women across the board - founders, funders, buyers. What impact does this end up having?

Melanie: One of the biggest challenges I’ve had as a woman founder in B2B software is finding mentors who have gone down my same path in my broad category. The lack of representation of other women who have done this before is intimidating. This also plays into referrals - we all know that introductions to funders and buyers typically come from your network. When the networks are homogenous it tends to reduce the number of referrals you’re going to get [as a woman].

Christina: One thing that does need to change that we don’t see addressed enough is that women can’t be pattern matched the same way that historical investments have been made with men. Typically you’re investing in teams with a technical co-founder, and the profile of that founder is likely male, probably an engineer skews a little bit younger. When I started Cube I was in my mid-30s and couldn’t raise money without a technical co-founder, so I had to run up a mountain to get one. We should consider looking at profiles of women founders a little bit differently - maybe this person is technical but doesn’t write code and has the ability to take capital and use it effectively. This is different from pattern matching two people: one who is a CEO and one who is a technical co-founder.

Mallun: The women have to have done it - we don’t get the benefit of the doubt. We have to show that we can do it even though we don’t look like the same guy who has done it already. And we are seeing guys who left their jobs on a Friday and have a $25M pre term sheet on a Monday. And what we’re trying to do here is create a new normal - looking at a founder and saying “that’s the new Christina” or “she’s just like a Melanie.”

What’s the psychology of raising VC funding knowing that you’re likely going to be at a disadvantage because of your gender?

Melanie: Going back to the early days of Spekit, I didn’t think that being a woman was a disadvantage. I was inexperienced in fundraising so that played a major factor in my experience. Founders have to learn how to pitch for one. Also, my co-founder and I initially crafted a very rational and data-driven pitch. The feedback was that investors want irrational confidence, and it takes some time to feel comfortable with that. So, I needed to have full conviction in myself, which I do, and I needed to have the confidence and trust in myself to be able to paint that vision for a new set of investors with every subsequent round.

How about the amount of venture capital that was deployed last year and the current frothiness of the market. Do you think this is something that women have been benefiting from along with the men raising money?

Melanie: I don’t have as much visibility into this as I’d like to but I’ve spoken to a ton of founders and I believe we received a fair valuation. Valuation is a metric that has a glorified perception, but the way it’s assigned is very arbitrary. At Spekit we ranked all the different attributes that matter to us when choosing our next investment partner - valuation actually ranked 4th. A lot of our success to date has been because we’ve been able to partner with investors like Mallun at Operator Collective and Brett at Bonfire Ventures who have been incredibly helpful in getting us off the ground.

I want to double-click on this idea of partnership - it seems like there are lots of people talking about diversity right now. How do you filter through the lip service and find true allies?

Christina: I just remember going through our pitch and there were several other funds that thought it was interesting but didn’t understand our space. I don’t want to give Brett [at Bonfire] a big head, but when we pitched him I remember him pitching Cube back to me in a better way than I had articulated and I was like, “Okay, they really get it.” And when I was going through the metrics the Bonfire team asked questions that made it clear that they not only know the space, but also know how to run a business.

Melanie: I chose Bonfire because of the first conversation I had with Brett - I showed him our sales deck and he gave me feedback on each slide. I could immediately see how helpful he was going to be. Similar to Mallun and Leyla - they just knew the Salesforce ecosystem so well, which was where our go-to-market was focused. So, at the seed stage, I really wanted to choose who had the most relevant experience and who would be willing to put in the work to support us. In our A round, I was very pointed in layering questions around diversity.

Mallun: I get to sit on all sides of the table now and what I’ve found is that people who take seed money from the larger funds get a lot less hands-on help. The larger funds have the brand recognition but they’re pretty much valuation agnostic. They have so much money under management that they don’t mind if they have to overpay sometimes. Funds like Bonfire and Operator Collective can’t overpay but we give our portfolio companies lots of help. So, as Melanie said, valuation was #4 on her list - and the reality is that if you can’t get from one stage to the next then it doesn’t matter what your valuation was.

A particularly hot topic is whether women should adjust the way they dress, speak, or otherwise present themselves to be taken more seriously in male-dominated industries?

Christina: Back when I was an operator I did dress up more at work. As a woman having my hair pulled back and wearing a hoodie just looks like I don’t care. I don’t think I can get away with it as much. In the earlier years, I also tried to be less feminine because I found that I was being taken less seriously. Now that I’m a CEO and I’m a little bit older I’m treated differently, so I’m able to be more feminine and dress more feminine.

Melanie: Before being a CEO I led with masculine energy but was given feedback by my now-coach who suggested that I might be able to make more authentic connections if I leaned into my very strong female energy and presentation. That was an inflection point and I now lean into embracing my femininity in ways that I didn’t feel confident doing before. I’ve found that this authenticity is really important, especially today. And I feel like I’m doing a disservice to other women by embodying what my male peers look like in the way that I dress and behave.

Mallun: There’s a question in the chat about height. I’m 5’4 and I wish I was taller but I’ll never be. I used to work at a company where all the men were 6’ and above so I wore heels every single day. I literally ruined my feet because it was a disadvantage being so much shorter than everyone else. I didn’t feel as confident and I couldn’t command the room as well. I still wear heels when I’m presenting or when I have a board meeting because the truth is that people do judge you on your appearance. But I do agree that you should be yourself and just accept that you will be judged on your appearance.

I found this discussion to be both eye-opening and inspiring and am super thankful for our participants' insights and vulnerability.  If I had to summarize what were the key takeaways for me, I would say that our fearless ladies told us to:

Be Bold: The right time to start a company is when you can't think of anything else you would rather do. This can be done in tandem with being a parent, partner, and/or caregiver.

Be Yourself: You got this. Push past the ‘imposter syndrome” and have confidence in yourself as a leader. Authenticity matters when recruiting employees & customers.

Be a Woman: Embrace your feminine instincts and traits. Resist the urge to “blend in” and lean into your power.

Be an Ally: Recognize that your women employees and colleagues may wrestle with the same anxieties you have overcome. Ensure that you have an inclusive and open workplace where they can thrive.

Be Wise: When picking financing partners, do the work to understand how often and how well they will support you. Trust your gut. This is a long-term decision with long-term implications.

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