The general business environment for women-led, early-stage businesses and startups is a good news story and a bad news story, says Carolyn Cassin, BELLE Michigan Impact Fund founder and general partner. She says women own 40 percent of all U.S. businesses, which in part represents 114 percent more women-owned businesses now than there were 20 years ago.
“But the not so good news story is that women really aren’t growing their businesses larger,” Cassin says. “We generate almost $2 trillion per year worth of revenue, but that’s a very small percentage — that’s only about 4.5 percent of the American economic revenue. And that makes no sense. We’re 40 percent of the businesses but we’re only contributing 4.5 percent. So there’s a lot of work to do.”
Though women tend to start smaller business, they tend to have a lot of trouble getting venture capital. She says only 25 percent of women seek venture capital and a smaller percentage actually get it.
“We’re not making the progress that we need to make,” she says.
Though Cassin led the first venture capital backed hospice company in the U.S., Vistacare, a company that became a publicly traded in 2005 and sold in 2008, she says she still faced challenges in business. For example, she says whether or not she knew every single answer, it was the men on her team who were asked the questions when it came to funding.
“I know that that still goes on,” Cassin says. “I know that it is just hard for women to break into the funding system in the United States.”
And that’s why she started her fund, which only invests in women owned and led companies: “because they just simply aren’t enough women-owned, women-led companies, and there aren’t enough venture capitalists that are women.”
She says when she started her first fund, people told her that what she was doing wouldn’t work — it was too limited. But it turned out to not be an impediment.
“There are plenty of women-owned startups,” she says. “They’re not always ready yet for venture capital, and so we spend as much time getting people ready to be venture capital-backed businesses as we do investing in them.”
BELLE Michigan has had no problem finding companies in the state to invest in, and the organization has become involved with a national network of women-owned funds — about 25 of them in the U.S. They invest alongside each other and don’t have any problems seeing good results.
“And I think that’s what will really change things, is when people see the results of investing in women-owned businesses,” she says.”
Cassin spoke at the recent Smart Business Detroit Dealmakers Conference about the challenges women entrepreneurs face and how her fund is designed to help. Play the video to catch the full interview.
