Creating Opportunities for Women-led Companies

August 24, 2018

In the second quarter of 2018, only 35% of reported venture funding to female-founded companies. Anu Duggal’s Female Founders Fund is working to reverse the trend. In this edition of What I Wish I Knew, we take a look at how Anu has been able to effect change for women in the tech industry.


Nora Ali: [MUSIC] Welcome to What I Wish I Knew,

Nora Ali: sponsored by Fidelity, where we talk to

Nora Ali: entrepreneurs about how they achieve success,

Nora Ali: and advice they would have given

Nora Ali: themselves along the way.

Nora Ali: Today I'm joined by Anu Duggal,

Nora Ali: a founding partner of The Female Founders Fund.

Nora Ali: Anu, thanks for joining me here today.

Anu Duggal: Thanks so much for having me.

Nora Ali: All right. So, the Female Founders Fund based on

Nora Ali: the principle that you can achie-

Nora Ali: achieve great returns ah,

Nora Ali: by investing in businesses run by women.

Nora Ali: So, expand on that a little bit more.

Nora Ali: What's that all about?

Anu Duggal: Sure. So, we believe that um,

Anu Duggal: we invest in technology companies and we believe that

Anu Duggal: the next generation of

Anu Duggal: successful venture-backed businesses will

Anu Duggal: be started by women.

Anu Duggal: And if you look broadly speaking at the market,

Anu Duggal: there is so much data out there that

Anu Duggal: shows from my diversity standpoint whether it's

Anu Duggal: women on public boards or having

Anu Duggal: diversity within your organization

Anu Duggal: leads to better results,

Anu Duggal: from an investment standpoint.

Nora Ali: Is there something specific about how

Nora Ali: the businesses run by women are different just,

Nora Ali: just naturally the different types of businesses?

Anu Duggal: We invest in great founders and we

Anu Duggal: believe that the female founders that we've

Anu Duggal: invested in really have

Anu Duggal: unique insights into

Anu Duggal: the particular business opportunities

Anu Duggal: that they're tackling.

Anu Duggal: So, it could be women's health, it could be,

Anu Duggal: we have a business called primary,

Anu Duggal: which is for kids clothing.

Anu Duggal: So, they've really been able to leverage their experience

Anu Duggal: to identify opportunities that are non-obvious.

Nora Ali: So, you started the fund back in 2014,

Nora Ali: you've raised money for two separate funds here,

Nora Ali: so how have things changed from when

Nora Ali: the company started to today? What has changed?

Anu Duggal: Sure. So, I think that um,

Anu Duggal: it's actually been very positive looking back at um,

Anu Duggal: all of the different uh,

Anu Duggal: factors within the industry that have changed.

Anu Duggal: So, whether you take the venture capital industry or

Anu Duggal: the technology industry and you factor in

Anu Duggal: things like the me too movement and um,

Anu Duggal: and just the fact that on the venture capital side,

Anu Duggal: you've had almost all of

Anu Duggal: the Sandhill Road VCs bring on a female partner,

Anu Duggal: and on the female founders side,

Anu Duggal: we've seen at least within our own firm,

Anu Duggal: the amount of deal flow that we look at on

Anu Duggal: an annual basis almost exponentially grow year over year.

Nora Ali: Wow! Really good progress then.

Nora Ali: Do you think the velocity of progress is,

Nora Ali: is right or is there still room for improvement?

Anu Duggal: I think there's still room for

Anu Duggal: improvement but I think at the end of the day,

Anu Duggal: once you start seeing role models,

Anu Duggal: when you look at a case like Katrina Lake,

Anu Duggal: who took Stitch Fix public, and you look at, you know,

Anu Duggal: we have Shengli Ma from Zoola within our own portfolio,

Anu Duggal: their company just raised a $100 million.

Anu Duggal: So, I think women really need to see

Anu Duggal: role models and examples and um,

Anu Duggal: that's going to be a really important factor for change.

Nora Ali: All right. So, starting this type of

Nora Ali: fund seems like it could potentially be very difficult.

Nora Ali: Just starting a fund in general and

Nora Ali: beyond that just educating ah, your investors.

Nora Ali: But looking back, what do you wish you

Nora Ali: knew when you were starting this fund that would make it,

Nora Ali: had made it a little bit easier?

Anu Duggal: In terms of background, prior to

Anu Duggal: starting the fund I was a entrepreneur.

Anu Duggal: So, I co-founded e-commerce company.

Anu Duggal: And um, after we got acquired,

Anu Duggal: I started doing some investing,

Anu Duggal: and I think that I kind of

Anu Duggal: came into the industry very cold.

Anu Duggal: I had a vision.

Anu Duggal: I felt like there was a real market opportunity.

Anu Duggal: Nobody was really focused on this

Anu Duggal: particular um, insight you know,

Anu Duggal: that female founders were really onto something,

Anu Duggal: and so I think that in hindsight,

Anu Duggal: if I was to do it all over again, um,

Anu Duggal: I, I would definitely look

Anu Duggal: at both New York and San Francisco,

Anu Duggal: I think there's equal amounts of opportunity

Anu Duggal: in both cities, but I think you know,

Anu Duggal: being a sole founder, it's tough to,

Anu Duggal: to be able to tackle both of those opportunities.

Nora Ali: Makes sense. So, when you're

Nora Ali: looking to invest in a company,

Nora Ali: what is that special sauce?

Nora Ali: What are you looking for? Aside from female founders,

Nora Ali: women-led businesses, what is it about the company?

Anu Duggal: Sure. So, I think we have um,

Anu Duggal: very similar things that we look for um,

Anu Duggal: you know, tha- that I think are,

Anu Duggal: are fairly straightforward from an investor standpoint.

Anu Duggal: So, number one is the founder.

Anu Duggal: By far you know,

Anu Duggal: what is their track record of success?

Anu Duggal: Have they been able to demonstrate you know,

Anu Duggal: success in other areas whether it's

Anu Duggal: personal, whether it's professional?

Anu Duggal: Um, I think that you know,

Anu Duggal: their ability to attract talent um,

Anu Duggal: is incredibly important because you know,

Anu Duggal: 30 percent of a CEO's job is just hiring.

Anu Duggal: Um, so, even early

Anu Duggal: traction around that is, is really helpful.

Anu Duggal: Um, I think that they have to understand and

Anu Duggal: have a unique insight into

Anu Duggal: the particular opportunity that they're tackling.

Anu Duggal: So, why are they well positioned to, to take this on?

Anu Duggal: What is it that they have that you know,

Anu Duggal: the other competitors don't

Anu Duggal: that will position them for success?

Anu Duggal: And then I think finally um,

Anu Duggal: you know, you have to be a great sales person as a CEO.

Anu Duggal: You're selling to your customers,

Anu Duggal: you're selling to your employees,

Anu Duggal: you're selling to potential investors,

Anu Duggal: you're selling to advisers,

Anu Duggal: and so you really have to live and

Anu Duggal: breathe what your company does,

Anu Duggal: and that's I think an important factor that we look for.

Nora Ali: Anything from a personality perspective for founders we,

Nora Ali: we hear about you know,

Nora Ali: you need to be extroverted to some extent.

Anu Duggal: Sure.

Nora Ali: But we're hearing more about the power of introversion.

Nora Ali: What is your perspective on that?

Anu Duggal: Yeah I mean I think that goes back to

Anu Duggal: my earlier point that um,

Anu Duggal: you know, whether you are introvert or an extrovert,

Anu Duggal: you have to live and breathe this company and you have to

Anu Duggal: have a unique insight that positions you for success.

Anu Duggal: So, when I look across our portfolio, you know,

Anu Duggal: we have founders ranging from 24 to 64,

Anu Duggal: personality te- personality types that fall within,

Anu Duggal: you know, all the Myers Briggs categories.

Anu Duggal: So, um, so I think diversity is important but I think you

Anu Duggal: really have to be incredibly

Anu Duggal: passionate about what you're doing and um,

Anu Duggal: and be able to demonstrate some traction.

Nora Ali: Absolutely. All right. So, in the second quarter of 2018,

Nora Ali: 35 percent of reported venture funding

Nora Ali: went to companies with female founders.

Nora Ali: That number is better than it has been in the past year.

Nora Ali: But what do you think is

Nora Ali: happening right now that it's going to get

Nora Ali: that number from being 35 percent

Nora Ali: to 50 percent or higher?

Anu Duggal: Sure. So, I think um,

Anu Duggal: going back to my earlier point,

Anu Duggal: what we've seen within our own portfolio is that now that

Anu Duggal: female founders have demonstrated

Anu Duggal: traction and on the venture capital side,

Anu Duggal: you see female investors

Anu Duggal: at some of the larger funds like I mentioned.

Anu Duggal: What I'm seeing is that a lot of

Anu Duggal: these female founders are actually looking

Anu Duggal: to partner with female investors.

Anu Duggal: And what that means for the industry

Anu Duggal: is that on the venture capital side,

Anu Duggal: these venture funds are realizing that, you know,

Anu Duggal: if you have a website that,

Anu Duggal: you know, is full of men,

Anu Duggal: then you're probably not going to

Anu Duggal: attract that female founder,

Anu Duggal: and investors are really kind of motivated by Fomo and,

Anu Duggal: and returns. And so-

Nora Ali: So true, Fomo is very powerful.

Anu Duggal: Yes. An- and so, you know,

Anu Duggal: I think that if they see companies being successful,

Anu Duggal: raising large amounts of funding,

Anu Duggal: going on to become public,

Anu Duggal: then I think that is what

Anu Duggal: really is gonna trigger the change.

Nora Ali: So, you invest a lot in tech as well.

Anu Duggal: Oh, technology companies? [OVERLAPPING].

Nora Ali: They're all tech. Right. So, what are

Nora Ali: you seeing in terms of trends when it comes to tech?

Nora Ali: What are you most excited about in tech right now?

Anu Duggal: Sure. Great question. So, um,

Anu Duggal: so there are couple categories that,

Anu Duggal: that we find interesting.

Anu Duggal: Um, so women's health is one area we

Anu Duggal: were early investors in Maven Clinic and uh,

Anu Duggal: through that experience have,

Anu Duggal: have identified and seen

Anu Duggal: quite a few opportunities

Anu Duggal: in speaking to the female health consumer.

Anu Duggal: Um, I think fintech there's still a lot of room

Anu Duggal: for opportunities specifically as

Anu Duggal: it relates to millennials,

Anu Duggal: who don't have the same relationship

Anu Duggal: with traditional banks that um,

Anu Duggal: you know, older generations do.

Anu Duggal: And then I think direct to

Anu Duggal: consumer commerce, um, you know,

Anu Duggal: we're seeing things like baby formula or um,

Anu Duggal: even other kind of food products that uh,

Anu Duggal: traditional brands have just not

Anu Duggal: innovated uh, within that category.

Nora Ali: As a serial entrepreneur as well you're

Nora Ali: no stranger to starting companies of course.

Nora Ali: So, before founding Female Founders Fund,

Nora Ali: you were the founder of

Nora Ali: an e-commerce company as you mentioned here.

Nora Ali: You also opened India's first wine bar

Nora Ali: super super cool, called the Tasting Room.

Nora Ali: So, what advice you have for young entrepreneurs

Nora Ali: here who are looking to start their own thing?

Nora Ali: Sure. So, uh, I

Nora Ali: think first of all starting a company is really hard.

Nora Ali: Um, so I wouldn't start a business just to start it.

Nora Ali: I know in today's day and age it's often viewed as

Nora Ali: sexy had a great career choice but um, it is very hard,

Nora Ali: it requires a lot of grit and resilience and, you know,

Nora Ali: um, I think that you have to like I

Nora Ali: said be very passionate about that idea.

Nora Ali: Um, I think if you do decide to start a company,

Nora Ali: the most valuable thing

Nora Ali: for me has really been my network,

Nora Ali: and by that I don't mean, you know,

Nora Ali: kind of traditional networking

Nora Ali: but as you come up with an idea,

Nora Ali: as you decide to,

Nora Ali: you know, kind of launch a business,

Nora Ali: make sure that you surround yourself with people

Nora Ali: who understand that business and, you know,

Nora Ali: whether you bring them on as advisers

Nora Ali: or have them involved in the business in some capacity,

Nora Ali: I think your network is the most important thing

Nora Ali: um, you own.

Anu Duggal: One last question for you Anu.

Anu Duggal: What is the advice,

Anu Duggal: the biggest piece of advice you would have given

Anu Duggal: your former self when starting your career?

Nora Ali: Um, I think probably to be patient, um, you know,

Nora Ali: now when you think about

Nora Ali: the car- career trajectory of um,

Nora Ali: of people graduating from college,

Nora Ali: there's so many different companies that you work for,

Nora Ali: so, you know, two years in,

Nora Ali: in one job is fairly straightforward.

Nora Ali: But I think for me I,

Nora Ali: I felt like the first career decision

Nora Ali: I made right out of college was,

Nora Ali: you know, going to be the rest of my life.

Nora Ali: Um, and so I think uh,

Nora Ali: just being patient and recognizing

Nora Ali: that you know there's a lot of

Nora Ali: opportunities and you're not stuck in

Nora Ali: one track um, is important.

Anu Duggal: Do you think that's changed uh,

Anu Duggal: from when you started your career to now?

Anu Duggal: We're seeing people who have jobs for

Anu Duggal: much less amount of time at once.

Nora Ali: Absolutely.

Nora Ali: Right?

Anu Duggal: Yes. Absolutely.

Nora Ali: These people are sort of learning that lesson.


Anu Duggal: Flexibility and um, and just more opportunity.

Nora Ali: And career pivoting as well.

Anu Duggal: Yes. Yes. [LAUGHTER].

Nora Ali: All right. Anu, thanks so much for joining

Nora Ali: us here today. Really interesting stuff here.

Anu Duggal: Thank you.

Nora Ali: Thank you.

Anu Duggal: Thanks for having me. [MUSIC]