Special Report from Inmaculada Martinez, Managing Director, Investments Advisor, STRADBROKE and Astia Community Member.
At the end of December, most papers in the UK run articles accounting everything that went on during the twelve months prior. Lazily scanning my Sunday paper, here came this snippet of an article entitled “The Double X Factor.” The first sentence caught my attention: “In terms of machismo, running a hedge fund is the closest the financial world gets to flying a fighter jet”, observed Christopher Swann on REUTERS Breakingviews.com. I almost gagged. Good Lord not another article on “Barbarians at Gates” or any of that 1980s Gordon Gekko palaver. If there is one thing that as a woman makes me want to smack someone in the face with my handbag is comparisons that create perspectives of the world from a male viewpoint, as if this single tunnel vision would encompass all humanity. Most women have no interest in piloting fighter jets or any other kind of speed artifacts. Excitement associated to risky actions, like speed, is not an enjoyable situation for all peoples. In fact, one could almost draw a direct correlation between adrenaline rushes caused by risky activities and testosterone levels. Against this backdrop, Bloomberg L.P. conducted a study showing that female hedge-fund managers outperformed their male counterparts between 2000 and 2009 – delivering 9% annually, against 5.8% for men. “Double X” funds did particularly well during the crisis, shedding only 9%, compared with the 19% lost by male-run funds in 2008. Bloomberg’s conclusion was that women tend to pursue “less extreme” strategies, and that they save on fees by trading less. In fact, female resilience looks particularly attractive given the industry’s high blow-out rate. Unfortunately for investors, Double X funds are hard to find: it is reckoned that women run just 3% of some 9,000 hedge funds.
Many women hesitate to launch their businesses because the word “entrepreneurship” is tainted by the media with “risk” connotations. These days, when getting fired from a job because of financial crises is more often than not on the regular menu, and being promoted as fast as your male counterparts or paid as much as they make is still not achieved, the thought of taking ownership of one’s professional life does not sound so risky anymore. Most women entrepreneurs that I meet launch their businesses because they feel capable of delivering their visions, want to be their own bosses and have a sense of higher accomplishment when they create product offerings that beat what is available in the market. They do it because they believe they can do it better than the SC Johnsons, the Nokias, or the Googles of this world. What they lack is how to raise funding.
In my 2010 objectives I have taken upon myself at Stradbroke to make it the year that I help some women finally get it together and go for it with their entrepreneurial plans to create big global companies, not just small to medium sized businesses that they can run on the side of bringing up babies. I am talking about the Single Ladies (With or Without The Ring On It) that will go for it for real, to build global successes and not just vehicles that they can run from home to earn the extra cash for the household.
When the barriers went down in media broadcasting, the Oprahs (Winfrey), the Ellens (Degeneres) and the Tinas (Fey ) took the top. Daytime television is what brings the dollar bacon to the networks because this is the primetime spot for the viewers who hold the purchasing power of most households. The night airwaves are too competitive and hence more fragmented. The music industry is also crowning the new revenue earning queen bees – Madonna, Beyonce, Lady Gaga, whilst the little fairies like Taylor Swift are sweeping all the awards back to the hive. The barriers in these industries were monolithic for decades. Nowadays, they’re finally down.
Oprah, Ellen and Tina took the helm of their projects and became producers, creating their own production companies and hence controlling their own product - Oprah now has an “end-to-end solution” because she finally owns her own network. Silicon Valley needs to back more female entrepreneurs because it needs to create an ecosystem of synergies, rather than a myriad of businesses driven by the same dynamics. If women in television and music can create multimillion dollar successes, there must be women capable of delivering the same value in other entrepreneurial ventures that have to do with technology, the sciences or commerce.
The reason why there are no more women-driven technology businesses shares the same answer as to why there are no more women film directors. In both industries, for a project to be put together as an attractive venture to be funded can take years. Moreover, for a funded project to yield financial success can take years as well. In television and in the music industries the acid test is performed on smaller vehicles: a pilot or a single song. Audience focus groups, gigs in small venues, a million cushioned tests to assess if something is going to be a flop or a hit or is worth the money to fund an entire series or an album and world tour. The assets created by startups or the film industry are enormous labours of love that can bring boxoffice results of hundreds of millions or come in below investment and lose money for everybody.
There are not that many women in technology and not that many others directing films because the money people do not trust them and do not buy into their ideas. Funding is still a people’s business of handshakes, lunches, hunches, and connecting with the other person. It is a business of obsessive follow-ups and throwing rejections over one’s shoulder and keeping on going. If this shocks you, please go to the Internet and try to find for me which woman film director has been nominated for an Oscar since the beginning of the awards or who got Best Picture. The answer is two times has the Oscar gone to female nominees in these categories: Best Picture to Jane Campion “The Piano” (1990) and Best Director to Sophia Coppola for “Lost In Translation” (2004). The rest are all men. This is the oddest, most bizarre situation ever to be analysed. Weird as it may be, it is a reality that hits you in the face. This past May, during the Cannes Film Festival, Jane Campion dared to speak openly about what we all keep behind doors: that “the studio system is kind of an old boys’ system and it’s difficult for them to trust women to be capable.” Why is this so?
Taking creative and unproven projects to fruition requires one to be almost “obsessed” with them. It is not about being “driven” but actually being absorbed by it. Genetically, women cannot become absorbed in some self-delusions because we are programmed by our DNA to take care of other people under our care and not be too self-focused. We also take rejections personally. In Campion’s words, “I think women don’t grow up with the harsh world of criticism that men grow up with, we are more sensitively treated, and when you first experience the world of film-making you have to develop a very tough skin.”
If you want investors to trust you, show them that determination, that vision of “get it or bust.” It is okay to be obsessed with achieving success for your project. It is okay to chase people on and on and on until they agree to meet you. I have seen films being funded because of this never-ending chasing. I raised money in the middle of the 2000 dot-bomb after all VCs in Europe rejected us (except for 3i who backed me also in other ventures afterwards) . The Skype founders had almost 50 investor meetings in London and only Index Ventures believed in them and their business. The film “Slumdog Millionaire” almost went straight to video if it weren’t for its producers who fought with tooth and nails to get rid of the original investors (Warner Independent) and found new ones. More female businesses will be backed if the women behind them “go against nature” and take their fund-raising like a crusade.
If you are reading this and wonder how you are going to get these skills and find within yourself this passion and self-belief, join Astia. This is precisely the kind of know-how that we are all here to share with you and instill in your business.
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