I’ve been fundraising my whole life.
In junior high, I made $40 a day selling candy to students. At 15, I earned a stipend as a science intern teaching paleontology to middle schoolers. By high school, I’d raised $600,000 in scholarships after embarking on a letter-writing campaign to over 200 companies.
As the daughter of a single mother, I was determined to do my part to alleviate the financial burden of parenting. Watching my mom teach full-time while running several businesses impressed upon me that women can do anything, especially when they are in control of their economic power.
Most women I know are able to work magic out of the bare minimum. Women uphold civilization – they nurture, heal, and create. In the work world, women routinely prove they are adept at running businesses and leading organizations – better than men. Women are killing it as business owners, opening new businesses in droves with women of color representing 64% of them. Women-run companies generate a 35% higher ROI than companies managed by men. When they’re venture-backed, the number further increases by 12%. Even with funding gaps, women-run companies generate a 10% cumulative revenue within 5 years.
For these obvious reasons, it would seem that investing in the sustainability of women entrepreneurs would be a no-brainer. However, no endeavor has proven more challenging than advocating for funding women business owners.
I’ve reflected on this for years, and I fully understand the patriarchy we’re up against – the gender bias ingrained in our societal minds. I mean, it was only a few decades ago when women couldn’t open their own checking account. Sadly, the financial sector today still doesn’t take women seriously. Women get approved for business loans at rates 20 percent lower than men, and the loans they do get approved for are usually smaller than the loans approved for men. Only 4% of business loan dollars ($1 out of every 23) go to women.
I’ve not only known these statistics for years, I’ve lived them. When I started EnrichHER, I was often told that I needed the help of “someone else” to enact my vision—maybe a white male who just finished his undergraduate degree, someone more “technical,” or one of their friends. This was said despite me having two bachelor’s degrees, a masters in information technology and a Ph.D. in systems engineering.
These experiences throughout my founder journey gave me endurance and fueled my resolve in the form of campaigns like “Ownership Reimagined.” I launched this initiative recently as a call to funders looking to do some good in the world while making a profit. This campaign is unlike traditional fundraising efforts in that participants submit funds to EnrichHER as a loan and are repaid total note plus interest after a year.
We’ve been doing this kind of funding at EnrichHER quite successfully. Since 2019, we’ve connected over 200 companies to $14MM in business capital. The companies we fund are majority women who identify as Black or Latinx. They’ve been in business for over two years and generate between $500K to $1MM in annual revenue. They’re conservative borrowers that are usually approved for over 57% more than the amount of funds they actually borrow.
Through “Ownership Reimagined,” we are accelerating our mission to get these companies funded, in light of the pandemic, and expanding our reach to funders who may not exist in the typical investor circles. Plus, there’s no better time than right now to invest in the lending industry which is projected to grow at a rate of 9.9%, reaching $28.5 trillion by 2025.
With so many dire circumstances affecting our socio-economic stability today, can we really afford to ignore the facts about why investing in women is such a wise choice?
Rather than sink funds into cryptocurrency, you’re better off putting your money into the New Majority. You’ll do more for your own pockets, not to mention contribute to the stability of local communities. Society as a whole benefits when small businesses thrive.
It’s time funders take a hard and honest look at where they’re putting their money and ask themselves if those funds could be doing more to impact the future. If the answer to that is yes, then look to women to lead the way.