#40Forward | Rethinking and Redesigning the Ecosystem

In the lead-up to International Women's Day we are reminded by the world’s media of the economic, political and social achievements of women past, present and future. So, as part of these celebrations, I often take this weekend of the year to reflect on Astia’s successes, those of our entrepreneurs and the high growth ecosystem at large in advancing innovation through inclusive leadership teams.

Astia’s raison d’etre is to promote, ally and assist women high growth entrepreneurs and their ventures, one by one and by changing the ecosystem. As such, this year, we’re delighted and proud to be part of Google for Entrepreneurs’ campaign #40Forward: 40 startup communities rethinking the gender gap, a challenge issued to startup communities to increase participation by women by 25% this year.

Dramatically Increasing Women's Access to Capital

Astia and Google for Entrepreneurs are partnering to increase the frequency and city coverage of the Astia Venture Lunches. We are tripling the number of opportunities for exceptional woman-led start-ups to access capital, as well as expand our reach to include new markets outside of Silicon Valley, London and New York.  

For those new to Astia Venture Lunch, it is Astia's groundbreaking effort to increase dramatically women's access to capital. Not once a year - or even quarterly - but every single month Astia showcases outstanding woman-led companies to accredited investors in London, New York and Silicon Valley. Using Astia's Expert Sift – the proprietary community-sourcing and screening process- in our search for supernovas, each presenting start-up is pre-screened by no less than 25 industry experts before being selected to present.

And what do we know that those selected start-ups will have in common? That their founders have made a very smart business decision: to be part of an inclusive leadership team.

Inclusivity is essential to innovation and job growth

“The diverse group almost always outperforms the group of the best by a substantial margin,” according to The Difference, Scott E. Page, University of Michigan. “The key to innovation, in economic terms, resides inside the heads of people, the more diverse the better. That link may not be immediately apparent, yet any understanding of innovation's role in economic growth must focus on diversity as well as ability.”  As such, Astia works with inclusive leadership teams and actively encourages all members of the team to participate within our community, irrespective of their gender.

The importance of men’s participation in the global conversation around women’s high growth entrepreneurship

We know that high-growth entrepreneurs are similar in almost every respect. Regardless if male or female, entrepreneurs have largely the same education, economic background, needs, and challenges. This gives credence to the need for a unique offering for entrepreneurs focused on including men and women.

Women, however, place greater importance on the moral support, expertise, and financial backing of business partners, while men need far less encouragement from others. This desire of women, for community support and engagement, is what Astia offers our entrepreneurs.

Women uniquely need:

1.  Access to Networks - Around the globe, men and women are still by-and-large in separate business networks. Men are the holders of capital for entrepreneurs. Investment relies heavily on trusted business relationships. Astia is a model for creating a global network of men and women doing business together. 

2.  Access to Opportunity - Research shows that women self-assess differently than men and as a result often have lower aspirations commensurate with the lower assessment of their abilities. Astia exposes women to the opportunity of high-growth entrepreneurship and to the tools and networks needed to succeed within it. This personal growth is best achieved through exposure to the Astia community of men and women who have been there themselves and understand the challenges entrepreneurs face.

Through all Astia’s work to promote, ally and assist women high growth entrepreneurs and their ventures, bringing together men and women who are dedicated to the success of women-led, high-growth ventures is front and center.

And I ask you this. As you assimilate the many truly inspiring women entrepreneurs you will read and hear about this week as we all celebrate International Women’s Day, take one decision that will ensure that men and women are coming together to change the gender gap.

Let’s move forward.

Let’s move #40Forward.

Graduates From MBA Programs Should Look to Startups, Not Corporations for Job Opportunities

Auguest 7, 2012
by Julianna Davies

Astia Guest Blogger, Julianna Davies is a researcher and writer for the online MBA resource, http://www.mbaonline.com. She suggests that instead of looking to larger and more established corporations, recent MBA graduates set their sights on the startup community in order to find positions with growth potential and plenty of learning opportunities. Julianna picks up on a theme mentioned on Astia’s blog, namely that startups allow for more freedom for their founders to develop the skills they need to succeed. 

Though the economic conditions in the United States and throughout the world seem to be slowly on the uptick, job security for new professionals remains quite uncertain. Students who flocked to Master of Business Administration programs years ago in hopes of landing a high paying corporate job are increasingly finding closed doors: even top-performing companies have largely clamped down on hiring, leaving many wondering how to pay off their student loans.

The answer, at least for some, may lie in startups. Startups are traditionally less secure than long-standing businesses, and the pay is often a lot lower to start. A growing body of evidence suggests that entrepreneurial ventures are the way of the future, however, which means that jumping on board now may actually be the smartest thing an MBA graduate can do.

According to a number of scholars, job growth is actually more secure in the somewhat unpredictable start-up environment than in traditional businesses and corporations. A 2010 report by the Kauffman Foundation, The Importance of Startups in Job Creation and Job Destruction, claimed that startups are some of the only opportunities for job growth in the modern United States. Larger corporations are hiring, of course. According to the report, they are not actually creating new jobs, though—they are maintaining their status quo by only hiring to match losses due to resignations or retirements. In many cases, the study found, many businesses are cutting jobs by only filling a percentage of their available slots.

“The study reveals that, both on average and for all but seven years between 1977 and 2005, existing firms are net job destroyers, losing 1 million jobs net combined per year. By contrast, in their first year, new firms add an average of 3 million jobs,” the Foundation said in its official summary of the findings.

Much of this job creation is owed to the ethos associated with most startups. A startup typically begins with an idea and a small group of dedicated entrepreneurs committed to bringing it to life. The company grows almost organically, expanding as needed to meet changing goals and to keep up with demand. The culture is usually profoundly different from larger, more established corporations.

“The larger and more successful the company, the more challenging it is to innovate, not only because of bureaucracy, but also because of a perceived fear of failure,” Gary Shapiro, CEO of the Consumer Electronics Association, a technology advocacy group, told Forbes. “Great innovation drives the most successful companies, from old-line companies that innovate their turnaround, such as Ford, to new generation companies that innovate to lead entirely new categories, such as Google,” Shapiro said.

The focus on innovation and creativity is attracting a whole new crop of graduates, many from the top schools. Organizations like Harvard University host start-up career fairs, where students can network and learn about career opportunities in a variety of small business settings. Internships are also exploding in popularity, enabling students to get a taste of life in the startup world while still in school.

While job security is important, most MBAs and other recent graduates flock to startups not for the paycheck, but rather to be a part of something bigger. “I feel like I’m a problem solver,” Daniel Shani, a 2012 MBA graduate from the University of Chicago Booth School, told the Chicago Sun-Times. “Entrepreneurs first and foremost are looking to solve a problem. They’re much less drawn to the dream of glory and fame. It’s really not about the money. I really would like to make a difference in the world,” he said.

Shani was one of several Chicago graduates to forego high-paying corporate work in favor of following their dreams—or just keeping more control of their careers. There is traditionally much more space to share ideas and be creative in entrepreneurial settings, and the work environment is often much more casual and laid-back.

There are trade-offs, however. “You need to be OK with rapid change, not having a clear road map, not having a management program,” Scott LaChapelle, assistant director of technology platforms and new employer development at Harvard University's Office of Career Services, said of startup opportunities. “You need to be OK with the fact that your job description, if there even is one, may change as well.”

Not everyone is well-suited for life in the world of startups. For those with business savvy who appreciate innovation, creativity, and positive change, however, there might be nothing better than trading in a suit for a slot on a small team of driven workers. The opportunities in this sector are only slated to grow, and job security—though never guaranteed—seems increasingly more promising for people with ideas to share with the world.

Why entrepreneurs, why women

I recently posted a response to an October 3 blog post by Mark Suster (Why Aren’t There More Female Entrepreneurs?), and I thought my comments should be translated more broadly. Below is a version of my post which is intended to clearly articulate the value proposition for:

Why [high-growth] entrepreneurship?
Why women [high-growth] entrepreneurs?

The simple answer to both - jobs and innovation.

A report prepared by the Ewing Marion Kauffman Foundation recently found that all net new jobs created in the US in the last 30 years have been created by high-growth start-ups less than 5 years old.

And further, research from Babson College found that if women high-growth entrepreneurs had the same access to capital as their male counterparts, we would see 6 million new jobs created within 5 years - 2 million of those within year one.

This is the jobs recovery we all seek.

Add to this the fact that we have women at the ready: women are nearly half the PhDs, more than half the college graduates and half the MBAs. It seems a logical missed-opportunity if women are not fully participating (for whatever the many reasons) in high-growth entrepreneurship.

It's about jobs.

Regarding innovation, there is an abundant body of research that demonstrates that innovation and group intelligence are directly correlated to the number of women on the team. Scott Page, University of Michigan and IBM both published work proving this and are great examples to represent the body of evidence.

IBM's findings were that group intelligence is directly correlated to three things:
1) The group member's ability to read each others expressions
2) The evenness of the conversational participation
3) The greater proportion of women

And further, the researchers postulate that numbers 1 and 3 are closely linked.

It's about innovation.

Dive right in! The water is fine!

If last year’s We Own It Summit in New York was a dip of the toe in to the water to see if it was warm enough, then this year’s Summit in London was a dive in to the deep-end followed by a forceful free-style firmly charging to the finish line in 2020.

The Decade of the Woman Entrepreneur is upon us and the collaboration has firmly embraced the opportunity and the challenge this presents. The Summit participants have validated that the moment is now to propel women in to the high-growth, innovation economy – as entrepreneurs, investors, and ultimately beneficiaries of the wealth and influence created.

Our next steps have been identified in the goals below. It is now the responsibility of we, the collaborating organizations, to maintain the momentum and deliver on these shared commitments:

In 2011-12, we will:

Create and implement collaboration processes for research and training.
• The annual research agenda will work to address 1-3 questions annually. This work is critical as the current dearth of data pertaining to women high-growth entrepreneurs is pronounced and does not allow us to measure our progress.
• The training objectives ensure that women gain exposure to the opportunity of high-growth entrepreneurship, investment, and board participation. The goal this year is to create a shared curriculum - via the many that already exists within the collaboration - that provides access to networks and access to maps to success.

Communicate to the market the stories of successful women entrepreneurs and investors as well as clearly articulate the problem, issues and opportunities. This year, we will complete and publish:
• 12 profiles each of female investors & entrepreneurs.
• A statement of why women’s participation matters for key constituents (LPs, VCs, government, etc.)

Take action that we believe will create real and measurable change in the market.
• A group, led by successful VCs, angels and LPs, has been created to raise an Astia Innovation Fund to invest in women-founded, women-led, high-growth start-ups.
• Borrowing from the model used by the Indian entrepreneurs in Silicon Valley a decade ago, we will work to get women to invest in women (as well as the men who love women entrepreneurs), thereby owning the solution for ourselves.
• Where we have influence as industry leaders, LPs, Fund of Funds, family offices, VC firms, government funding agencies, etc. we will work to get women in to decision-making bodies.

The nearly 200 thought-leaders who participated in this year’s Summit have identified the above goals for the coming year as the deliverables that will lead us to the success in 2020.

And for those new to this race, the finish line has been mapped. Through this Summit and this collaboration – and any other means available to us - we will:

• Increase number of women investors.
• Increase number of women high growth entrepreneurs.
• Increase likelihood of success of these businesses.
• Get more women on public and private boards.

Come on – dive right in. The water is lovely!

Cheers,
Sharon Vosmek, CEO

NYC vs Boston

What follows is a guest post by Astia NYC Vice President, Rob Delman. Welcome to the team, Rob!

Have you been following the story about whether NYC or Boston has more VC seeds deals? It is like debating who is better, the Yankees or the Red Sox (although we all know the answer to that question!)

According to a study by CB insights, when it comes to seed investments by venture capitalists, data suggests NY’s seed venture capital investments are gaining momentum at a faster rate than Massachusetts. Q1 and Q2 2010 saw an increase in seed venture capital investments in both Massachusetts and New York but the growth rate and the absolute number of deals was greater in NY in both quarters as detailed below.


Venture accelerators like Astia are enthusiastic about the data as we love to see an increase of quality deal flow regardless of the geography. This is more validation that small business and entrepreneurship continue to be the catalyst for growth in our country. The recent announcement by the White House and creation of Startup America reinforces our belief that entrepreneurship and small business are the main drivers of job growth and wealth creation.

Astia and Golden Seeds (www.goldenseeds.com) recently shared a booth at the Funding Post NYC Venture Capital and Angel Showcase in NYC where over 30 VC firms and several hundred entrepreneurs met to see if there was a match of interests. The entire scene was spectacular – clean tech, life science, consumer goods, technology and media sectors were all represented. Some of the ideas sounded futuristic but regardless, the energy was overwhelming. One could not help but feel that the economic recovery was going to happen at that very moment in that very room.

So does it really matter if NYC or Boston has more deals or invested capital? Of course not – what really matters is Astia and other great organizations participate in the entrepreneurial revolution that is again sweeping our nation.