How Serena Williams invests for social impact via her venture capital firm and listen to our podcast with Christina (CJ) Juhasz about investing in women

  
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Welcome to our #93 weekly newsletter.

“For women taking control of their financial future”

-Jana Hlistova


From The Purse


In this week’s newsletter, we spotlight Serena Williams who is considered to be one of the greatest tennis players of all time.

Serena launched her early-stage venture capital (VC) firm, Serena Ventures, in 2014 with the mission to champion diverse, creative founders who are changing the world with their ideas and products across a wide array of industries.

Her mission-led investing approach is generating social impact by focusing on underestimated founders and underinvested markets.

You can review the news in brief so you stay on top of global financial, economic and investing trends.

And don’t forget to listen to The Purse Podcast with Christina (CJ) Juhasz, who is the Chief Investment Officer (CIO) for Women’s World Banking Asset Management (WAM).

We talk about impact investing, gender lens investing, why invest in women, emerging markets, women’s access to finance and more. Please enjoy!

I hope you enjoy this week’s newsletter.

Until next week,

Jana


Serena Williams: investing for social impact through her venture capital firm

How mission-led investing creates impact


Serena Williams is considered one of the greatest tennis players of all time. But her talents extend beyond sports to the world of business, entrepreneurship and investing.

According to Forbes, Serena’s net worth is $240m.

Serena launched her early-stage venture capital (VC) firm, Serena Ventures, in 2014 with the mission to champion diverse, creative founders who are changing the world with their ideas and products across a wide array of industries.

Today, Serena’s VC firm has 50+ portfolio companies with $33bn market cap, and 60% are diverse founder investments, as per Worth.

Black female founders: why is raising investment so difficult?

In Serena’s 2020 op-ed for CNN Business, she writes about the unique challenges black female founders face when raising capital for their early stage startup:

“The Black female founder begins her fundraising journey already down a match point.

Black women face a unique set of challenges colored by misconceptions of both race and gender. Investors notoriously doubt female founders, typically focusing investment analysis on the potential risks and losses of female-founded startups. They often assume that women-founded companies are more likely to fail….

Meanwhile, Black founders contend with systemic inequity at each step of their journey. Investors expect to see more traction from Black founders than their White counterparts, and will often question their technical expertise and market understanding.

Black female founders exist at the intersection of these challenges, making it exponentially more difficult for them to get the funding they need…

Black women rarely have a wealthy network they can call upon for early investment…”

Here are some stats (US) to highlight the problem…

  • Only 4% of the people who work in venture capital are Black

  • Only 3% of the people actually leading investments are Black

And in 2018 and 2019, Black women founders raised only 0.27% of venture capital according to a data report by digitalundivided.

Serena goes on to say in her 2020 op-ed:

“Without the network necessary to raise critical starting capital, most Black female founders close shop before their product even reaches the market. By building exclusive spaces and systems, we are missing out on the innovation and genius of so many..”

Silicon Valley, therefore, does not have a talent pipeline problem; it has a network selectivity and resource allocation problem.

So how does Serena Ventures address the problem?

The firm invests in early-stage founders who often pitch them on a vision. They look to support dreamers and visionaries of the future, while giving them the opportunity to capitalise on their genius.

This is a fundamental difference in how female founders and founders of colour are thought of and evaluated.

By recognising the systemic bias embedded in the mindset, process and decision-making inside traditional VC firms, Serena Ventures turns the process of investing in diverse founders on its head.

They invest based on potential and opportunity.

Here is one example of a startup they have invested in:

One Black woman in the Serena Ventures portfolio includes Crystal Evuleocha, who is a recent Forbes 30 Under 30 honoree and founded Kiira, a telehealth platform for collegiate women focused on addressing women's health inequities.

Kiira's AI-driven platform is staffed by health care providers who understand the gendered and racial nuances of health care, where Black Women are often dismissed.

The social impact of…

…investing in female founders and founders of colour is vast because the markets they address have been ignored or marginalised by investors for so long.

These markets have historically been underinvested and their customers are often underserved.

It is not surprising then that the startup valuations for female founders and founders of colour can also be below market value. And traditional investors are able to buy in at a huge discount.

This is despite female founders having a higher return on investment than their male peers. They often have to bootstap their startup for longer and become better money managers in the process.

Simply put: they do more with less.

In October (last month)…

…Serena Ventures partnered with MaC Venture Capital and Michael B. Jordan to create a startup pitch competition for Historically Black College and University (HBCU) founders.

The winners, will be announced by Williams and Jordan during halftime of the inaugural Legacy Classic, on the 18 December and will be awarded up to $1m in structured safe investments.

Read more:


News in Brief


Financial news

Crypto: bitcoin, ethereum & DeFi


The Purse Podcast


We cover the following in our conversation:

  • Impact investing

  • Gender lens investing

  • Why invest in women

  • Women's access to finance

  • Emerging markets

  • Measuring social impact

  • and more

Please enjoy! Listen on all podcasting channels including iTunes and Spotify.


Coffee Break? Read This



We’d love to hear from you. Get in touch with Jana via the The Purse website or tweet @jointhepurse and @janicka.

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