Misunderestimating Women Has a Price

A tale of opportunities missed – and what we did about it.

I prefer to work with people I like, and I really like the team behind Hooves (hoovesapp.com). There’s no guessing where Hooves will end up, but they work hard, have a great idea, and the last year has been a lot of fun. They also happen to be women, so last year I taught Hooves not to smile.

Ninety percent of mentoring women in startups is the same as mentoring men. The last ten percent is not. I don’t have to mentor men on how to deal with investors who don’t take them seriously because they’re men. I don’t have to mentor men on how to present their product or service to investors who don’t understand men.

Misunderestimation is a common mistake

Alina and Suvi, the two founders of Hooves, fit a lot of our stereotypes about horse people. Both are young, female, outgoing, and blonde. Danes would call them ‘hestepiger’ – or ‘horse girls’. A lot of investors they met dismissed them to talk instead to introverted young men with glasses or overconfident fast talking salesmen types.

We changed the pitch

Just before the summer, we changed two things in their pitch – their focus and their delivery. Many pitches spend either too long on the problem or focus too specifically on their initial solution. The first Hooves application matches people who own horses with people who want to ride horses. The big opportunity the company presents, however, is digitizing an industry more than three times bigger than golf. That’s what they pitch now.

They also changed how they pitch

The world expects women to smile, so Alina and Suvi stopped smiling. You don’t have to be Harvey Weinstein to be a jerk to women. Too many investors of both sexes we spoke with referred to Hooves as the “horse girls”. A wardrobe change to black helped, but I think the big shift came when they stopped smiling.

Now people listen

My data is limited, but an investor recently said that half way through his meeting with Hooves he started wondering what he had done wrong. “They’re so serious”, he told me. I let him in on the secret and he nodded. Hooves are getting more meetings and, as of this week, have raised half of their next round.

Investors have been throwing money at golf concepts, because they know it’s a rich sport and it’s one they play. Hooves isn’t about innovating part of a sport, it’s about making lots of money and that’s what they pitch. Plenty of people seem to be able to find the opportunity in imperfect pitches, so why couldn’t they see the play in Hooves?

Stand back, the ladies are coming through

At an investor event where the pitching companies got access to the stage an hour before, I watched them practice their pitch over and over while other presenters just wandered around. They knew exactly where the sightline was between offstage and on stage and when the audience would first see them. They work harder.

Life is short and we spend a lot of time at work. I prefer to work with people I like. These ladies are kicking it.

Show Them The Money

It pays to know more than one language: Speak numbers.

I hosted a case competition called the CBS Finance Competition a while back at Copenhagen Business School and it was an eye-opener. The case was the Danish manufacturer Danfoss and the focus was their acquisition of startups. Two things stuck out: it was a boys club and it was all about the numbers.

It’s a pickle party

Do not confuse the society we want with the society we have. All twelve of the participants in the competition were white men in dark suits. There were only two women in the first two rows of the auditorium. Both worked in HR. All of the men wore dark suits, except for the professor, who wore a blue blazer, and a member of the Danfoss merger team, whose suit was gray.

Plan for today. Change tomorrow.

By all means be depressed by the current gender-gap and work to change it, but plan based on fact, not aspiration. Danfoss is an impressive company and they’re socially engaged, but facts are facts. If you’re looking for a corporate acquirer, know that the odds are overwhelming that you’ll be talking to a white man who studied finance. The ratio will change in the future, but plan for the ratio that exists now.

Your focus isn’t their focus – and this makes sense

Startups often focus on team and product. Most corporate investors focus on the numbers. They are buying for very specific reasons and usually have very specific KPIs. They may be how many customers you have or the size of the markets to which your product will give them access.

Like the jury in the competition, you’ll most likely be talking to finance people. Their degrees, surprise, surprise, are usually in finance. The exceptions work in an environment dominated by finance. To them, your product is not something that does A for B, but something that can generate X revenue over Y time. Know how to talk their language.

It’s all about the Benjamins

I ran into an old friend shortly afterwards who used to run an accelerator. After a year off spent working for a corporate, he had spent a couple of months helping a handful of his companies raise money. It had gone well. Why? He’d spent a year working on the other side of the table from the startups.

“You can talk about team and product,” he said, “but it’s all about the money.”