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Learn what needs to change in the VC world with Tanya Rolfe and Gail Wong from Her Capital

Did you know that female-founded companies make up 6.8% of funded startups and receive less than 3% of global venture capital funding??

Joining me today on the show is Tanya Rolfe and Gail Wong from Her Capital. A venture capital firm for women. Her Capital focuses on the strength, drive and potential of female entrepreneurs across Southeast Asia and invests from pre seed stage through to series B. Both women have a track record of building incredible startups and have worked with hundreds of visionary female-led businesses.

Listen to this episode if you want to learn about the world of VC, what place women have in it and what needs to change.

Please note, this transcript has been copy pasted without the lovely touch of a human editor. Please expect some typos!

Okay, so, um, I'm Gail and I grew up in Singapore and I spent my first career on Wall Street across three continents, um investment banking. So that was where I started to wonder where all the women were. You know, I've grown up in this meritocratic society and you kind of, I brought up to expect that the world's your oyster, right? And you can do anything. And then I noticed that will, I was often the only woman in the room um and I think that shaped everything I've done since my second career as a coach is supporting women in business and helping them be their highs self and uh to lead in their own expression.

00:03:25Edit And it brought me back to this whole corporate finance journey because I think fundamentally without money, without funding, a company can only go so far, um and also without sort of supportive investors and partners. Um and I really saw how female founders were, had a disadvantage or had to fight against additional barriers. And I thought like this cannot Be the case in the 21st century. So, um that's kind of led me to really focus on funding for females and navigating that journey. Amazing. And Tanya, do you want to share a little bit about what you were doing before? Yeah, sure. Um so my background was in law firms in the UK and Australia. And um, but most recently since I've been living in Singapore, which has been three years now, um I launched Ladies Investment Club, which was an investment team of self funded female investors investing in female entrepreneurs and Gail and I worked on that together and grew the team and and that's really where Her Capital um came because we reached a point where we had close to 40 female investors and we wanted to be able to make more significant investments, follow through the various funding rounds a bit more and, um, and just reach more entrepreneurs.

00:05:03Edit So that's where the idea of Her Capital came from. Amazing. I read a crazy statistic on your website that said female founded companies make up 6.8% of funded startups and receive less than 3% of global venture capital funding, which is just quite shocking. Really, Very, very true. And in the UK alone, I think last year they received one penny For every £1, um, venture funding last year. Yeah, yeah. Oh wow. You've both invested in a lot of startups already. What does the ideal startup look like to you both? Well, I think there's a few pieces to that. There's obviously the financial piece. Um, so it's been interesting investment financially in terms of the industry they're in and the upside that, uh, uh, it has potential to reach. Um, but I also think that it's important to invest in a company that has, uh, the right people.

00:06:12Edit So that's not only just skills, but coach ability or the openness to, Um, pivot or to make the necessary changes that, you know, you may not see from day one, right? And people with everything in terms of being able to attain and implement those grand plans? Um, so that's the, that's, that's an important piece. And the third, I think increasingly, for me personally, um, it's not just sort of an investment to make a ton of money, but it's the business being run quote unquote. Right? So, um having become a mom and dealt with the first hand, you know, with what it takes to, we're a happy family and have a satisfying career and to contribute outside the home. I think it's about work practices and the values in the business that dictate, you know, anything from how, what their policy is for working moms to environmental impact and sustainability and what kind of habits that they inculcating in their users.

00:07:27Edit Um, it's sort of having that lens of, um, I don't know, I suppose consciousness. Um, that is increasingly important to me personally, I've spoken to a few founders recently who also have Children and they've said, you know, once their Children was born, they realized that they had a calling to make the world a better place for their kids. And I think that's such a special thing and such a nice thing for the world to be getting more more products and more things in the world based on that calling. Yeah. And further more for Gail and I we both have daughters as well. Um, and, you know, my my intention as a mom is I'm raising both my Children with equal opportunities and I want a world where she has, you know, she has the opportunities that her brother has. Yeah. So that's a another important point, I think. Yeah, absolutely. And so with her capital, how do people find you or how do you find businesses that you're interested in investing in?

00:08:33Edit What's the process? So her capital is right at the very beginning of its um, we're in our infancy. Um so um to date our deal flow has come to us organically and we've been incredibly lucky, and part of that is because we're based in Singapore, in Southeast Asia and unlike in europe and the U. S. There are very few um female focused venture capital funds. Um in fact, you know, most funds operate on very similar um structures which we Gail and I have views on and we want to do things differently. And I think that in itself and the fact that we are two females and we have a track record of supporting female founders actually actually puts us in a good position, marketing wise and attractive to female founders that wouldn't perhaps otherwise go for for funding.

00:09:37Edit So Organic has been most of our um deal flow a word of mouth and our events. Um and we've just recently launched our marketing campaign for her capital. As I say, we are we are at the very beginning of our own journey. Um, so we're supporting female founders in their startups whilst also starting our own startup. So it's a it's an interesting place to be? Yeah, wow. And do you want to talk a little bit about the direction for her capital? Is it to invest in seed rounds or is it more focused towards Series A. Or series B. What's the ideal sweet spot for her capital? Well we want to ideally come in as a partner early in the journey. Um That would probably be at the seed round um and possibly series A. And we hope to see the companies grow into their next phase and um get to another one or more rounds of funding and we look to participate alongside as well as bringing in, you know bigger investors, strategic investors who can be relevant to the more mature, see just a company.

00:10:56Edit So that's the idea. Yeah. And when you're investing for example into a seed round, how much money would you typically put in for a seed round? And at what valuation? Just as a roundabout for anyone listening who who doesn't know this information. Mm Well it's uh these are interesting times, right? Um And I think the industry as a whole is expecting adjustments in valuation after what has been quite a hot a hot season. So valuations can be quite a broad range. And also by geography can vary quite a lot a series a seat in the U. S. Um would be a few times of what the seed round could look like in asia just because of the cost of doing business and you know the market dynamics. So it's it's a really hard thing to put a finger on. Um I'd say we have seen seen grounds um between 12 mid single digits valuation.

00:12:07Edit And the rays could be anywhere Between 20 to 40 or 50% of that valuation. Um and we do see seeds of varying stages to some are Some are just an idea and they they are asking for $1 million dollars valuation and some actually have a product market fit um with early customers. So you have to triangulate um for all these things rather than just a number or just a revenue figure alone. Yeah and when you're doing your due diligence and you've kind of started the process, you're interested. You want to invest in this company. What's the process next? And how long does it take until you send a term sheet and you know deliver the funds? How long is the hole is the whole process? Um Well I think a lot of that has.

00:13:13Edit So to date our investments have really varied depending on the circumstances. But I think we've done we've actually done some very quick deals in the past and we've also had deals that have taken probably up to six months. So in my experience there's very little consistency in the length of time. Would you agree with that girl? Yeah it's um there is. No I don't think there's a standard playbook but it would probably I would probably expect three months at the minimum. And some people fund raised ongoing lee in fact that's more of the reality. Um And even if it's completed around you're thinking about the next one, you know? Um And you're a founder should always be expect to be in conversation with prospective investors um Even just to keep them updated. Um So I would say it's not like a black and white fees just more on than off at certain points.

00:14:25Edit Yeah. As a female founded business, how would you determine whether you want to go in the direction of VC in general? How would you decide if that's the direction for you? Yeah. That's an interesting one. Um When we do we have, you know, seen lifestyle businesses or kind of business that really aren't um don't have plans to grow aggressively. Um So even in D. C. There are probably investors of different appetites and um working style. So I think it's also important to look at prospective partners rather than just try and approach all of them are or appeal to all of them. I think it is quite a significant dilution to take on an investor so that pie needs to be big enough for everyone to win. Um And you probably want to, I always advocate for self funding as far as you can and if you can get a business too profit or to be able to self invest, that's always worth thinking.

00:15:39Edit You know, there's a lot of vanity metrics about, oh I've raised so much money and so that validates my business. But I've seen also a lot of great businesses, many run by women actually who get it to a point where it can sustain further growth and they take investment later. Right? I think it's all right, it's a business owner. And you know, when you're saying like, you need to make sure the pies is big enough, how how much equity do the founding team or how much should they be retaining into A series A or B? Because I'm often wondering when I, when I watch shows and that kind of thing and I'm sure other people like, you know, shark tank and, and um, Dragon's Den, when you watch things like that on tv what you're meant to be giving away because I guess when you're just getting started, you don't really know right? You don't really know how much equity you should give away to someone. So how much should you be keeping and then, and then retaining throughout, if you're gonna keep raising My answer to that would be around retaining 80% equity around a series a but I'm not sure if gay and I have actually discuss this and concluded the same figures, what do you think they'll, well, it's, uh, it's a range in reality to, I've seen, Um, levels that are far lower than 80 and women may be more willing to collaborate and bring on other owners because they see the bigger picture.

00:17:13Edit Um but I think for it to be interesting in the long run and to motivate founders? I'd say somewhere in the 50 to 75 range is probably a good one to aim for pre series a because it's gonna come down, so yeah, because it'll dilute after each, each round that you move further on. Yeah. And when people are coming to, like, for example, if I was like, yeah, I want to raise VC, um I've got this really great idea, I know that you guys have a fund. What do I need to do? What needs to be in my pitch deck? What do you want to see from someone like me? I'm trying to think what we can say, that's not sort of something you can easily find on the internet, right? I think the basics need to be addressed. So what's the problem? Why are you the one to solve it? Um I do think, I think we also tend to look beyond the pitch.

00:18:20Edit Um the pitch is just sort of the knock on the door and everyone's pitches well polished and looks great. Um that's what, that's what a pitch deck it's meant to do. Uh So I think it's also about, I think referrals are really important that human connection and um being having someone who can vouch for you or who has worked with you, um that tends to be quite the calling card and I think with women network that's especially valuable. So is that like oh I have a mental like connecting, is that what you mean? Could be a mentor or an advisor to the business or even someone maybe you know who has worked with you in a past career and can really who really knows your quality of work or your attributes. Um It's a struggle because I think that's partly what's kept VC so kind of one dimensional because it's a network of the same people finding the same people.

00:19:25Edit Um But I think it does make a difference to be introduced to a founder by someone who has known them in some capacity. There are a number of Vcs that have not many, but there are more forward thinking Vcs that are stepping away from that pitch and I don't just mean the pitch deck because I think that's probably a given that that needs to be produced, but as gale said, I think that forms only a very small part of whether you're going to give um an entrepreneur time with you over a coffee to take things slightly further, Right? And it's something gay and I have discussed on many occasions um and also the fact and gail alluded to it, but you know in the US I think 65% of all venture firms do not have a female partner amongst them and then you um research suggests that people invest in people that remind them that remind them of themselves, maybe a younger version of.

00:20:33Edit So it's, it should be no surprise then that, you know, males are pitching and they're probably um receiving the funding because they're, you know, let's say a white male. Um and um, so for us we've been talking and thinking about how we do things differently and that, you know, and that pitch process probably forms part of how we may do things differently with her capital. Yeah. Right. It's really interesting to think about investors look to invest in people that they see themselves in. Um and so I guess then you should also be thinking about researching really the specific people who are part of the VC fund that can invest in you that you have similarities with as an entrepreneur you mean? Yeah, yeah, for sure, for sure. And that goes back to the point where I feel like our deal flow is um you know, not to be complacent, but it is largely organic because um I think as a female entrepreneur, you do want to have, you want to share, share your business with people that are like minded.

00:21:48Edit Um and some of those differences are quite stark if you're a 28 year old female walking into a room of 50 something white men. Um so I can, you can understand why, you know, we, we we do actually receive a lot of attention from female entrepreneurs because they actually want someone that um they have an affinity with. Yeah, yeah. Someone that really truly understands them and understands the problem the same way that they see it. Yeah, potentially. Yes. Yeah. Does her capital have specific industries that you're looking at for businesses or is it kind of across the board at the moment? We are sector agnostic for sure, but products and services that have technology behind them um scalability purposes are obviously much more desirable to us. Um but we are looking at right across the industry sectors and what are the kinds of industries at the moment that you're seeing potential in or that you're kind of seeking out female founded businesses.

00:22:59Edit So I think we're actually in a very good position um even even in spite of what's happening globally with the pandemic right now, because we're able to, because as we mentioned, we're obviously at the beginning of our own journey and this pandemic has given us um fresh eyes I think um into looking businesses that are doing well in this in this market. And although this is an unusual market, it is a market that, you know, we have to make sure that our portfolio companies are able to, you know, to to uh to survive this type of period. And not all businesses are surviving right now. And so it's given us the opportunity to really think probably quite differently to how we thought about things say six months ago um as to the types of businesses, you know, particularly environmentally. Um and as I mentioned, the technology, you know, technology businesses right now, uh still soldiering on pretty well.

00:24:03Edit Um I think it's highlighted to ask some some sectors that probably not for us to focus on right now. Um but I still wouldn't say that it's really shone a light on any one sector and we're kind of pinning all of our hopes on to that just to add on to that. I think that it's definitely underlying the importance of a digital strategy um in any business and even if it were services or you know, like healthcare, um telemedicine and things like that. So there's stuff with some new pockets to be explored. And then if they were non tech businesses, then we cannot ignore as we might have in the past or overlooked in the past the importance of a digital strategy obviously as A and B. To be um type of businesses are increasingly attractive in this market, but I think they've always had some interesting characteristics.

00:25:10Edit Pre covid Yeah, I imagine um productivity and management tools at the moment are soaring. Uh huh. Um do you have any resources that you can recommend for women online who want to learn more about the process and the world of VC, sort of some go to staple websites for information about the VC world. Well, I think the U. S. Has a lot of established groups, especially the angel groups that then help people position for the next level, right? So some of the nice uh, next wave is one of the pioneers in the space and they have a lot of educational, um, content. It's more geared to investors, but I think it's worth a look for an entrepreneur to understand the mindset. And also the information is the same right? In terms of the stage and the rounds and evaluation. And also, don't forget our own website, we're very happy to um, to engage, have coffees when we're able to have a chat on the phone, um, and and talk to female entrepreneurs that are wanting to find out more about VC, not necessarily because they want to, um, they want us to invest in them, but just if if there's, um, if there's more information wanted, we're happy to be part of that.

00:26:33Edit Amazing. I'm gonna pop that all in the show notes for everyone to be able to move into. Um, I wanted to ask you, what advice do you have for women who are looking to raise venture capital? What's your number one words of wisdom for both of you? It's like picking a life partner. So you've got to know what you want and don't back down from that and don't settle for kind of the inferior version of it too in the sound bite. That's what I would say. Yeah. And trust your instincts when you're, you know, it's part of the do diligence processes, um, it's a two way street, and so I think it's making sure, yeah. Which feeds into gales point. It's just making sure it's the right person. It's, it's not just, there's plenty of capital out there, it's just finding it. So having that positive mindset of not thinking that every time you walk into a VC room, if the answer's no, that doesn't mean that you're business or your idea is is not good enough, It's just the wrong person, the wrong, the wrong fund, there will be a right fund out there, and it's maintaining that positivity, um, taking that forward and learning from each of those pitches or discussions, however you've done it and taking that forward into the next round, because there's so many no's um, and it takes a really strong founder to keep pounding the pavement.

00:28:08Edit Yeah. Being okay with rejection and learning how to sit with rejection. Yeah, and, and I, I really, I'm a personal believer in mind mindset and um, you know, walking into a room and being told no, it's it's tough. It's tougher for anyone, um, but it's remembering throughout all of that that it's a no here, but it's not a no everywhere, and that's really hard to keep in your mind and bring that to the four every time. Um, but it's true that the money is out there, the and the right people are out there to panel with, um, it's just hard to find them, which goes back to gales point again about finding a life partner, you know, that's hard to um and and that they are out there, but it's hard, but you have to maintain that positive mindset because I think that really does carry you through on that journey because it isn't easy. And you know, it's particularly hard for female founders as well. No, got a book in a lot of dates, you kiss a lot of fun, you apply the same rules.

00:29:16Edit Yes, absolutely. And I must say like in the personal life, it's it's easier to divorce in personal life than business. So it's not just about getting the money, but it is a long term relationship and a difficult investor can really make life miserable. So it's as much as the kind of that positive chemistry and what you can do it together as it is about making sure you can navigate the bumps. Yeah, absolutely. So I usually ask six quick questions at the end of every episode and because I've got two of you on the podcast, I was thinking that I would ask Gail first and then we'll do Tanya secondly, Okay, second is what I mean. Okay, so number one is, what's your, why my daughter and her generation? Okay, number two, what's the number one marketing strategy that made your business pop?

00:30:22Edit And I guess this is a little less relevant to you guys because you've only just gotten started. Um but maybe there's one success that you can share from um that's maybe business pops and starting? Yeah, I would say relationship driven, which is quite a interesting paradigm in investing world. And that's true. I found in sort of how I've transitioned from my coaching work to investing full time. The relationship is what sets the context for the investment and it's what makes, you know, the portfolio work we would do together. Um, effective. It's what helps me figure out if this is a founder, we could work with long term and does she have what it takes to go through the bumps. So that relationship driven also means kind of how we would relate to a founder. Um, the types of events we would speak at the topics we would talk about just creating spaces where we can relate human to human.

00:31:29Edit Number three is where do you hang out to get smarter? Mm The boring places like HBR and Mackenzie uh, reports, you know, my in box is always full with these things. I read them sometimes. Uh, but I think that's always being on the lookout for kind of a fresh take on on things. There's so much content out there. So you have kind of to be open to new perspectives. Our new sources. Yeah. And getting recommendations from other people for sure. Which is what I do. I basically go away and google all of these, all of these amazing resources that I hear afterwards and sign up. Uh number four is how do you win the day and that's around your am and your PM rituals that make you happy, feel successful, feel productive. Um for sure. Journaling in the morning. Um, I think if we can't sort of brains out, it's really hard to be our best.

00:32:35Edit So I take the time to do that, whether it's yoga or journaling or just sitting quietly and PM is not always consistent because sometimes you just wanna have some ice cream and watch netflix. But what what is good is really to bookend the day and look back and celebrate wind. Sorry if getting out of bed was a win on that particular day, then that's it, you know, sort of in a no pressure kind of way because I think we all need to acknowledge ourselves especially if we're doing something that's hard and that gives us kind of that juice to keep going. Yeah, I agree. I should do more reflection. Um number five is if you only had $1000 left in your business bank account, where would you spend it? And that's kind of to show where you're, you know, what's most important for you to allocate resources to, I think we're quite a lean business.

00:33:45Edit I mean we're not, you know, a brick and mortar type business. So I would really, if I had very limited resource, I would put it towards um exposure and building relationships because ultimately it's being trusted to manage someone's money and to direct it? Um, to the best of my ability. So yeah, we are doing something interesting with social media that is unusual in the VC world. Um, and I would also put it to other, yeah, I'd explore creative ways on how we could reach investors and connect meaningfully with them. Yeah. And number six is how do you deal with failure and it can be either your mindset or just you're a personal experience. Well, that goes to my why and I always think to my daughter's first step. Um, and there's a saying that when kids fall, they don't sit there and cry well sometimes, but most of the time they just get up and try doing it again and again until they get it.

00:34:59Edit They have not learned kind of internalizing failure. Um, and I think as as adults, we do that a lot and it's not very productive. So, um, I try to think back to a child, a toddler finding their feet and fast forward to, you know, watching her sprint on the football field, does that juxtaposition and be around the corner that, that leaves, you know, Yeah, it's a really nice analogy and I think, you know, we're all just doing that right. That's life just finding finding your, your steps and going one ft at a time in front of the other and picking yourself back up to keep going. All right, so Tanya, I'm gonna ask you the six questions. Number one Is, What's Your Wife? My wife is that I felt that I didn't have the same opportunities throughout my career so far and much like Gail I want those, those same opportunities for my daughter.

00:36:11Edit Um, and I've got about 15 years until she's out in the big wide world. So, uh, I've got a timetable. Yeah, that's a really nice answer. Number two is what's the number one marketing strategy that made your business pop? I think one of the shortcomings we've, we believe is the case for traditional venture capital firms funds is that they are quite often faceless. Um, and we, we want to be to be different and, and by that we want to be approachable and we want to be um people and have the human element to it. And so part of that is making ourselves, um putting ourselves out there as individuals doing things like this, Things like videos on our linkedin page and twitter feed. Um, and just trying to make it relatable to people. I think that probably is what sets us apart. Yeah, I really enjoyed your linkedin video that you posted the other day. Um, and I look forward to seeing more of those.

00:37:15Edit I think that's really clever. Thank you. Number three is where do you hang out to get smarter. I cycle a lot and I've recently in the last 6-9 months switched from music to podcasts, which is funny because we're on a podcast, I listened to a lot of podcasts every day as I cycle. Um so that's that's for me. And at the moment I'm really enjoying the New York Times podcast. Oh yeah, I've been listening a lot to um the daily by the new york times. Yes, that's the one I'm talking about, that's the one, isn't it? Great? I just find it's so easy to digest what they're talking about and easy to understand. It's it's wonderful, it's on such a mixture of topics and it really just Covers all the bases in a very like 30 minute synopsis and it's just yeah, it's great. Yeah, it is really great. Um # four is how do you win the day? I'm very driven by. Um I need I need direction and I need to give myself direction or someone needs to give me direction usually its myself.

00:38:26Edit So I'm a list person. So I start my day before my Children wake up and I write my list in my phone of what I need to do that day and then at the end of the day I go back to that list and it's a real achievement for me and I almost don't go to bed until that list is ticked off. So that's probably it was like, wow. Yeah, but I I know and I know myself you're like listen it's 10 p.m. But I'm gonna have to backtrack and get that done well last night I got my laptop out at 10 15. So what was that Tuesday night I was watching netflix. I got my laptop out because I remembered that I had something to do on my list and I got my linked in out and I did what I needed to do and it took me about 45 minutes and much longer than I thought, but I knew that I would not be happy until I've done that and I was kind of cool with doing that and then I felt good and I was like okay that day's done tick. I've done well today, That's how I win. Yeah, a real sense of accomplishment. Yes, exactly, exactly. Going to sleep very happy.

00:39:29Edit Uh number five is if you only had $1,000 left in your business bank account, where would you spend it? The only answer is I wouldn't um I wouldn't spend it. Um I would have I would come up with new strategies for um building that $1000 up, which as a as a fund is is very different to as gale said of bricks and mortar business. Um So but I don't think I would spend that $1000. I would um I think we would need that in our account, go and take a million coffee meetings with everyone else. Um Number six, final question is how do you deal with Paleo? I'm a typical cancer Syrian And so I come back to my home and I shut the doors to the world and I don't talk to anyone for a very short period of time and I think, and I think, and I'm a really deep thinker and I think it all through and then dust myself off. And for me, as I mentioned earlier in this recording is that for me, everything is about mindset and I trained myself to have that positive mindset.

00:40:43Edit So if I've been told no, if the deal didn't go through or something didn't happen, it's not that I believe in that kind of everything happens for a reason. Thing is it's not that it's just more that I genuinely believe that the positive mind, I attract more positivity and good things come and happen. So it's, it's almost almost a killing of yourself in the beginning and then building that up from there, that actually better things are coming. Yeah, great way to approach it. I think I'm quite similar. Yeah, Ladies, where can people find you online? We're on twitter, her capital underscore VC and um linked in her capital. And if people want to reach out to you directly, where is the best way to do that? We're tania at her capital dot VC and Gail at her capital dot VC. Amazing. Well, thank you so much for taking the time for being on female startup club podcast. Thank you for having us.



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