Rethink Impact Case Study: Iron lady who could draw VCs in Silicon Valley to invest in female-owned company

The female-owned businesses haven’t received much attention from most Venture Capitalists giants. This has made Jenny Abramson’s Rethink Impact a chance to make a profit in this business.

Jenny Abramson, 40, a Venture Capitalist who is a founding partner of Rethink Impact. Its office is located at Hera Hub which is a co-working space for female entrepreneurs in Washington D.C. The woman with long straight black hair and comb to the right shoulder works as advisor to women who decide to leave full-time job to become an entrepreneur. Her winning motto is that “I truly understand how you feel.”

Rethink Impact can raise $112 million since March last year. It wants to make investment in the female-owned startups which utilize technology to create a better society. Though the amount of fund doesn’t seem so much, but it is the largest fund ever raised in history for female entrepreneurs.

According to CrunchBase, the number of 100 largest US venture capital firms, there are only 8% of them which have women as partners and 58 companies have no female partners at all. The information gathered by Pitchbook indicates that since 2016 there are only 4.4% of the companies founded by women. Since 2016, the companies funded by VC accounted for less than 2% only.

Despite report from First Round Capital that the companies that has reviewed a total of 300 initial projects over the period 2005-2015, it found that women’s founding companies had operating results 63% better than that owned by men.

Jenny Abramson says this is an example of a single venture capitalist’s performance. In fact, there are many other studies which suggests to give funding to women entrepreneurs to make good returns. Rethink Impact’s business is not about profit-making only. The more important goal is to create an ecosystem for female entrepreneurs.

The sexual harassment that happened at Silicon Valley that caused the chaos to all entrepreneurs there since last summer brought Abramson and her partner Heldi Patel from West Coast to send letters asking for advice from women. She has talked with more than 700 women who are business owners, including via telephone and emails. The goal is to reach 2,500-3,000 people throughout the period of the fund. Rethink Impact ultimately decides to invest in only 25-30 companies. Rethink Impact seeks to reinvigorate the new venture capital firms, especially the investment that will benefit the society and create equality.

Abramson was not the only one who saw the opportunity. In October, the Wharton Social Impact Initiative reported that 47 US funds have invested in gender equality issues. They could raise about $ 1.1 billion and most of them are new investment capital over the past few years.

Aside from Rethink Impact, which has a strong connection with female entrepreneurs, there are also Sheila Johns who co-founded Black Enter-tainment Television and Sachiko Kuno, co-founders of two drug companies. Both are ranked in to Top 50 Richest Self-Made Women for FORBES.

There is also Jennifer Frist, a prominent investor who came from of wealthy families in Tennessee, and UBS Wealth Management, who chose Rethink Impact as their first private social fund to presented to the company’s  American customers. It is speculated that modern women, including those in the Gen Y era, are beginning to see the need to see their investments could make better things that just making money.

So far, Rethink Impact has already invested in 14 companies, including Neurotrack, an online screening provider for people with mental disorders, to anxious elderly people; Change org, a complaint site; Werk, an online service provider for flexible executive and management positions; Aclima, a provider of design and implementation services for air quality sensor networks, and Angaza, solar equipment producer through Pay-As-You-Go technology platform which enable those in poor, rural areas to access power supply.

“The driving force has come,” said Jenny Abramson and added that the source of funding for women entrepreneurs is increasing in number today. “The size of our company today may be symbolic that genuine change is coming,” she said.


Source: FORBES Thailand