Reflections of a female founder-turned-VC

Growing up, I was taught that self-reliance is the ultimate mark of success.

My father dropped out of high school to start working in his late teens and became a business owner in his late twenties – around the time I was born. My mother graduated high school and had a stint as a tutor before spending the better part of her twenties and thirties as a stay-at-home mom.

Photo credit: Pikisuperstar

Both my parents came from large families with seven siblings each and grew up in a small town in Sumatra in the 1950s and 1960s, when schooling was basic and opportunities were limited. Most of my uncles became small-business owners themselves, and the women of my mother’s generation, by and large, either worked alongside their husbands or were full-time homemakers.

As the oldest of four children, I was the first in my family to complete a university degree. My siblings have since eclipsed me in their academic achievements, but I remember thinking on my first day at Yale that my life’s trajectory was about to diverge from what my parents experienced. A university degree opened up a world of possibilities for me, and I wanted my fellow Indonesians to experience the same.

It would be another 15 years before the idea for ErudiFi (the startup I co-founded) came to be, but unbeknownst to me, the seed of entrepreneurship had already been planted. Today, ErudiFi is enabling students in Indonesia and the Philippines to pursue higher education and is backed by investors such as Y Combinator, Monk’s Hill Ventures, Qualgro Ventures, Patamar Capital, Intudo Ventures, and AC Ventures.

Not many women are as lucky as I was to have turned a desire into a reality. It’s the year 2022 and yet only 2% of last year’s record-breaking US$330 billion in VC funds went to all-female founding teams. Dig a little deeper and a range of thought-provoking statistics surface. A 2018 study by Boston Consulting Group showed that businesses helmed by women deliver higher revenues than those founded by men, returning more than twice as much per dollar invested.

While every entrepreneurial journey is challenging in its own right, there is compelling evidence that women can do just as well if not better than men in this arena. Moreover, women represent a significant half of the consumer base and play a critical role in driving innovation in areas such as femtech, a US$40 billion opportunity in 2020 that is projected to reach US$75.1 billion by 2025.

So why don’t we see more female tech founders?

One might argue that there’s an implicit bias in the investment process that often leaves strong women-led businesses bereft of adequate funding. After all, tech has largely been seen as a male domain, and as archaic as that philosophy is, it is going to take some time to shake off that belief.

A lot has also been said about carving out a gender-balanced space in the VC universe, and yet the needle hasn’t moved much. Most conversations talk about the lack of female founders being a result of few limited partners backing female VCs, funds not offering women the same scope as men, and not enough female VCs being promoted to partnerships.

An article in the Harvard Business Review reports that since 1990, only 8% of VC investors in the US are women. This figure is not much more encouraging in emerging markets.

On the founder side, experiential studies point to evidence that pitches delivered by men are 60% more likely to receive funding than those presented by women – even though the pitches may be indistinguishable. Of course, we need more data to conclude the root cause – including whether this is indeed a result of systemic bias or a “top-of-the-funnel” problem, with fewer female founders than male counterparts from the outset.

Regardless, the lived experience of many female founders suggests that these challenges are very real, albeit nuanced.

That said, not all women experience entrepreneurship the same way, just as not all men (or insert any other qualifier here) experience entrepreneurship the same way. Some have been extraordinarily successful, while others have found it more challenging, regardless of their gender.