The Crunchbase “Female Founder Series,” is a series of stories, Q&As, and thought-leadership pieces from glass-ceiling-smashers who overcame the odds, raised funding, and are now leading successful companies.
I was lucky to learn early that being a doctor wasn’t the only way to make a difference in the way people receive their health care. If it had gone the other way, I’d probably still be in residency or studying a specialization.
Instead, over the last few years I’ve worked at health tech startups that made a profound impact on health care consumers, from hardware for the visually impaired to software for hospital-distributed patient education.
Now, in building Caribou, I am driven to reach the millions of Americans that need help navigating the health care system through our trusted network Healthcare Advisors.
The adversity landscape in health care
I’ve always felt very welcomed as a woman in my field of work. Women make up the majority of the workforce in health care, so there is certainly not a “women in healthcare” problem like there is in other industries. Women are actually better represented at all levels in health care than in corporate America across the board.
There is, however, still a very prominent “women in healthcare leadership” problem. The representation of women in health care declines at senior leadership levels. It’s a steep drop from the 63 percent of roles at entry levels that women occupy to the 30 percent of roles in the C suite.
Data from McKinsey demonstrating the drop in women representation in senior leadership positions in healthcare (2017)
It doesn’t take an analyst to look at these graphs and point out a problem; thank you to those who collected and summarized this data to eloquently show the world that there is. The health care industry has more than enough women working within it to achieve true diversity in leadership positions, but it’s up to the individual companies to better understand and address structural or institutional barriers that may be deterring women from these advancements.
A bias in one of our sales channels
I certainly acknowledge that women have grown their hold on leadership positions across industries in recent years. I’d be remiss, however, not to highlight how far we still have to go with a personal story that shows how we still face barriers that impede the speed of our progress.
One of the ways we acquire customers at Caribou is through the financial services industry, due to the fact that–almost always–you can’t make decisions about your health care without considering the financial component. Upon realizing this was a great channel for us, my co-founder (a male) and I set out to do some outreach to private wealth managers and financial planners. Divide and conquer, we thought. Boy, was that ever wrong.
We each set out to email a few hundred firms with the exact same email copy and subject line. While our open rate was identical, the amount of responses we received was polar opposite. My co-founder was able to book 10 meetings within the first couple weeks of outreach, but I hadn’t received a single response. We continued to tweak our emails to test different messaging, but the results remained unchanged.
It was clear that I wasn’t going to make any headway with the outreach in this good ol’ boys club, so we quickly shifted our respective priorities. Although it would be interesting to see the outcome, there aren’t enough hours in the day to pull a “She’s the Man” experiment, removing the headshot from my signature or changing my email address to include the name Christopher rather than Christine. If I was a man, I’d never have to consider those things, which is enough of a distraction as is.
2020’s toll on woman-led companies in venture capital
It’s too soon to say if the trouble I’m experiencing from the financial services industry is typical or if COVID-19 has undone progress that has been made to date for women in leadership positions.
Early data, showing investments in woman-led companies are on track to be the worst since 2017, supports the latter. The drop follows a record-setting year in 2019, where $3.35 billion was invested in over 700 deals. There are a few key reasons that could explain the plummet:
- Women (particularly moms) are taking on other jobs, like at-home schooling.
- Jobs with steady income and health benefits are a lot more appealing due to the decreased risk profile.
- Extra capital is being distributed to experienced founders, who are mostly males.
It’s clear that the pandemic is disproportionately affecting women, so we need to be building a resilient funding ecosystem. Startups with a female founder are able to generate over twice as much revenue for every dollar raised than male-led companies, so this year’s stats are counterintuitive to the trends that support a stronger economy. These numbers need to rebound fast, or female founders risk having to make up ground for something we’ve already worked hard to cover.
Our approach to fundraising
So what makes investing in a female founder a no brainer when they’re already facing an uphill battle in the financial sector on top of an economic crisis that is pushing all women back? Truthfully, I’m not yet sure. As nice as it would be, this story doesn’t end with me having successfully raised hundreds of millions of dollars. We haven’t even formalized a round, but that doesn’t mean the process hasn’t started yet.
I’m certainly no expert, but some of the best advice I’ve received to date that has shaped my approach to fundraising fits into one of the four points below.
- Don’t rely on venture capital.
- Start the conversations early.
- Identify what is repeatable.
- Focus on creating value.
A lot of founders go into building their business with the mindset that they need to raise money to grow. Although this is often true, mindset is everything when you’re in the early stages. A day where you’re on top of the world can be followed by one where you’re dragging your feet. The more you can convince yourself that you are in control of your growth, the quicker you’ll be able to be able to hit that next milestone without asking yourself, “Could I accomplish this faster if I just raised money?”
It’s best to start conversations way before you’re looking to fundraise so you set yourself up for success when you do start hitting those milestones. Build relationships with VC firms when you don’t have an ask with a dollar sign in front of it. Instead, be curious about what metrics your target VCs want to see you hit in the next 30 days, quarter, or 6 months. Keep them posted on your progress and continuously ask for feedback so that it’s a no brainer when you come back and say, “Look, we accomplished exactly what you wanted to see.”
As you work toward your milestones, like signing pilots, building tech, or generating revenue, start to develop an equation as to how your efforts, and achievements, can be multiplied. If you’ve done X with Y, now you have to optimize it so that you are achieving 100X with significantly less multiples of Y. If something is working really well, like a particular sales channel or messaging, try your hardest to understand why that is so it can be replicated. Talking to your customers is the best way to get direct insights into this.
At the end of the day, don’t lose sight of the reason you started your business: to solve a real problem and offer value to the group of people experiencing that problem. It can be easy to get caught up in the numbers and comments from external sources (like VCs) but don’t let them distract you from your north star. Establish your values early and ensure you’re prioritizing them. This will make decision-making a lot easier, not to mention quicker, especially as you consider bringing in strategic partners through funding.
When all of those stars are aligned, the story behind raising venture capital becomes a lot more compelling, and it will matter a lot less if your name is Christine or Christopher.
Christine Simone is a co-founder at Caribou, a platform that connects people with trusted health care advisers who know the health care system inside and out. Schedule a free consultation today to see how Caribou can help you navigate and make informed decisions in areas related to health insurance, finding care, medical costs and more.
