It's a man's world, but not for much longer if Jesse Draper, CEO of Halogen Ventures has a say in it. Getting her start in the media industry, she now runs a venture capital fund that focuses on investing in women-founded consumer technology. As a woman and a business owner, you know I jumped at the chance to speak with Jesse about empowering other women in business. Jesse had a lot to share about creating the next women billionaires.
LM: Tell us your origin story.
JD: My name is Jesse Draper and I run Halogen Ventures, a venture capital fund focused on investing in women-founded consumer technology. I started my career as an actress on Nickelodeon. I then created and ran a technology talk show for the last 10 years. Through that I realized I could help support women-founded businesses by giving them media exposure and I also started funding them with small checks. Some of those companies I funded were Sugarfina, Carbon38 and Laurel & Wolf. I then raised a fund to keep doing what I had been doing at a larger capacity.
LM: Do you believe women are more suited to run companies? Why?
JD: Women on average raise half as much money than men typically do for numerous reasons including, unfortunately, access to capital and there is data that says they then make double the return. I think it's about balance. I recently suggested to one of my portfolio companies that our next board member should possibly be a qualified male candidate as there are currently 4 women on the board. I don't think one gender is better than the other, I love men and love women as well. I just want to create more women CEOs and prove their numbers can fly too.
LM: Tell us about the fund and its focus.
JD: Halogen Ventures is an early stage venture capital fund focused on funding women-founded consumer technology companies. There are not nearly enough funds focused on this problem and most traditional venture capitalists don't even have one woman CEO in their portfolio. I am a 4th generation venture capitalist and the first woman, I wanted to change this problem. I grew up around incredible investors and entrepreneurs in Silicon Valley, but they were all incredible men and I am actively changing this problem now.
LM: Why do you think it's so much harder for women to raise money?
JD: There are a lot of reasons. The biggest being that men control most of the capital. I know so many male VCs who don't even realize what a boy's club they run in, but if you take a fairly recent Unicorn like Cruise Automation who sold to GE and you look at all of their investors, every single one of them is male and every fund that went in is predominantly male and the founders of Cruise are male and all of the funds and investors who went into Cruise are friends. This is a standard example of men not only controlling the capital but this also points out that traditional VCs have their habits and it's difficult to penetrate. It's also especially difficult for women to raise funding for a women-focused product when you are pitching to all men. Part of what we do at Halogen is plug them into the ecosystem and break that male-oriented mold. Nothing against Cruise, or their investors of which my Dad was one, but I know that I can get women in the mix in these situations and diversity breeds success.
LM: Why do you think it's so much harder for women to talk about money?
JD: This drives me absolutely nuts. I have started to make it a habit of talking with my girlfriends about money and investing because even some of my friends who work in finance don't invest in the stock market which I didn't realize until recently. Dealing with money used to be the man's job. This has trickled down and women don't feel like they understand all the inner workings of money and how it moves. What I like to say is, money isn't that complicated and it's actually a very creative industry. Everyone focuses on 'saving money' but you can GROW your money by investing. You can multiply it by investing in public stocks, private companies, real estate, you name it. I have pitched women more than a few times who tell me around meeting number three, that they would feel more comfortable with their husbands making this decision because they don't understand it. I encourage all of the women out there to put your money to work - $100, $1000, whatever you have. Put it in the stock market or invest in something you believe in. The more you diversify, the more you learn and the more your money can grow.
LM: Top 3 tips for fundraising (timing, approach, etc.)
JD: 1. If you haven't closed them by meeting three, you probably won't close them. You know pretty immediately who is interested and who isn't, so don't waste your time on someone who hems and haws.
2. There is such a thing as a bad investor, don't take the money from them. If it takes you a little longer to raise it, you will be happier in the end.
3. Leah Busque from Taskrabbit changed my whole perspective on fundraising. She told me 'I love fundraising. Enjoy it!' and I started to realize, although it's a roadshow and you are on a plane all the time, you are meeting with incredible people and telling them about what you are passionate about and what you love. It's a privilege to be able to raise money for something you believe in and sell your vision. This will resonate with your investors. Have fun! I found myself having a one-on-one meeting with a huge idol of mine, Diane Von Furstenberg and telling her about my fund and I had to pinch myself.
LM: What's next for Halogen VC?
JD: We are currently investing our fund into the best companies we can find and supporting them to the best of our ability to create the women billionaires of the future which is where we can help the capital change hands or at least contribute to balance of the gender power. Next, we're going to take over the world and bring a whole lot of women (and men) up with us!
LM: If you weren't doing this what would you be doing?
JD: I ran a talk show for 10 years in the technology sector called 'The Valley Girl Show.' We were nominated for an Emmy and we did incredibly well as an independent talk show. That said, I am very burned out on the media industry and it's incredibly broken. I don't think I would still be running a show, but I would be hyper-focused on finding the key to fixing the media industry. Instead, we are investing in some technology companies that might change the media game. I'm happy doing what I'm doing, but I do have an obsessive fear of sharks and might be some sort of marine biologist if we're really thinking outside of the box here.
LM: Three words to describe yourself and why?
JD: I feel like this was a question on my college applications. I think I wrote ambitious, creative and spontaneous. I would stick with these.
LM: What is your favorite word?
JD: Bioluminescence. I recently went on a kayaking trip with my family in the middle of the night and witnessed this first hand. It's incredible.
LM: What are some trends in companies that are getting funded these days?
JD: Good ones! With a proven business model. With a billion-dollar market. With an MVP. With some traction. Some combination of these things will get you funding. That and a solid team, preferably including a woman. If you are striking out regularly with investors, listen to their feedback and realize something needs to change. Tracy Dinunzio from Tradesy once said to me, "Know when the 'potential investor' you are meeting with is not going to invest and change the conversation to 'Why?'" You may end up creating a greater relationship with them in the end by asking their advice and understanding what qualms they were having. You also might improve your pitch.
LM: What is your take on cryptocurrency - next .com bubble or here to stay and will change our economy?
JD: My family, especially my brother Adam and my Dad are all in on cryptocurrency and I definitely agree. Not a fad. This is the future. Not only is it the future, but it is a better future. My brother was hacked at Wells Fargo bank and someone stole a significant amount of money from his account. He figured out the bank account number of the criminal and the bank, but due to privacy laws, the hacker is protected and my brother can't get his money back. This would not happen with bitcoin, litecoin or any of the others. They are all traceable and it's much safer. In a completely other industry, the sex trafficking industry has been using bitcoin to pay for underage women online, which has made some people think that bitcoin is a bad thing. If you use bitcoin to purchase sex online. You. Will. Get. Caught. The government is watching this industry along with buying assassins online among other illegal activities like a hawk. Everything is better, more transparent and more traceable in the crypto world. The only thing we don't know is who Sitoshi is.
LM: Is there anything else you'd like to add?
JD: Support our companies, they are all women-led.
And there's nothing we like more than supporting women-led businesses.