A Network of Her Own

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Instead, Roberts joined Sevin Rosen in 1994 and used her insider status to help Brosseau enroll 1,000 members -- including a smattering of men -- dedicated to supporting women in business. "I love to hook people together, to encourage connections and build a community," says Brosseau. Those thus hooked range from first-time CEOs to powerhouse VCs like Hummer Winblad Venture Partners' cofounder Ann Winblad, who recently invested in a start-up she discovered through the Forum. Brosseau also has garnered financial and other support from heavyweights like Microsoft, SoftBank, and Kleiner Perkins Caufield and Byers. Members do much of their networking through a private E-mail list, posting requests for fund-raising advice and seeking introductions to lawyers and accountants, angels and VCs.

Valerie Buckingham joined the Forum in February and four months later was closing in on a first round of $750,000 for Meconomy Inc., a privacy-protection start-up. "I got direct referrals that got me in front of venture capitalists," she says, referring to contacts made through both the organization's staff and its members. The first-time CEO also availed herself of the Forum's seminar series featuring the wit and wisdom of Bay Area VCs and other experts in structuring early-stage investments, negotiating term sheets, and presenting to people like themselves.

Male entrepreneurs care about this stuff too, of course. But while the Forum's lessons are gender-neutral, the approach is targeted. "Women network differently. They seek to be more collaborative and less competitive," Roberts says. "You can see that on the E-mail list and in the meetings. People go out of their way to help each other."

The success of organizations like the Forum depends on the existence of like-minded investors. More women are getting VC money because more venture funds -- many with female principals -- are targeting start-ups whose founders are women. Along the way, those funds are both exposing their CEOs to a broad array of investors and introducing investors to funding opportunities that they might otherwise have missed.

Back in 1994, when Sona Wang began soliciting institutional investors for the first venture fund targeting women who are entrepreneurs, the Wall Street Journal reported that fewer than a dozen female entrepreneurs nationwide had landed $1 million in venture capital. No wonder that Wang's idea for Inroads Capital was "perceived as risky," she says. "We knew it was risky."

Managers of venture funds targeting women stress that they're not interested in special-needs cases.

Six years later Chicago-based Inroads is the largest of the women-oriented funds, with $50 million under management. Women's Growth Capital Fund, in Washington, D.C., followed Inroads' lead in 1997, investing $18 million in 13 companies. A year later San Francisco's Viridian Capital added $30 million to the pot. New entrants since 1999 include Cincinnati's Fund Isabella, with $10 million, and Boston's Axxon Capital, which at press time had just closed its first $12-million fund.

Concerned that their missions might be misunderstood, these funds' managers emphasize that they're not interested in special-needs cases. "We get lots of callers who say, 'I am a woman, and everyone else has turned me down, and you need to help me," says Patty Abramson, cofounder of Women's Growth Capital Fund. "But we're not looking to invest in companies nobody else wants to fund. We're in the deals to make money."

"People always assume that there's a double standard if you focus on something crazy like women," agrees Wang. "Our investment criteria are the same for all our companies."

Indeed, two-thirds of Inroads' investments are in businesses founded or run by men. Diversity helps the fund stay in the thick of the deal flow, and that, in turn, builds credibility for its VCs and all its portfolio companies. "We view ourselves as a conduit for non-women-focused funds to invest in these companies as well," says Wang. "When we call our colleagues on the West Coast and ask them to look at a deal, they pay attention, because it's come to them through the old referral network."

That's not to say women-led venture funds have found acceptance more easily than the entrepreneurs they back. When former securities broker Sheryl Marshall started scouting institutional investors for Axxon Capital, she says the reaction among many was, "Ugh! A venture fund focused on women? How can that be successful?"

But Marshall sees her gender as an advantage. Like some investors and entrepreneurs, she believes that women are sometimes quicker than men to detect the promise in other women's ideas. She recounts, for example, how male VCs scratched their heads over one woman's plan to start an online wedding registry -- a concept that appealed to Marshall instantly. Says Dorothea Herrey, a VC at Scripps Ventures: "We've seen a couple of deals in retail fashion where my female colleague and I had different reactions than the men in the room. We get the business better because we are the target consumer." And that perspective should matter to all VCs, since women are the chief household buyers and account for roughly half of all E-commerce purchases.

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