The business of startups — from conception to bootstrapping to securing angel investments and venture capital to long-term success — is a risky one. Statistics vary depending on the definition of success, but as a general benchmark, only about one in ten startups backed by Y Combinator have succeeded in the past five years. It gets riskier for startups run by women, since angel investment and venture capital is often run like a boys’ club. Additionally, because a startup’s fundraising often begins with immediate resources like friends and family, where queer women and women of color are already disadvantaged, startups run by these women are even rarer and riskier. But hopefully, that’s changing.
In 2011, Natalia Oberti Noguera founded the Pipeline Fellowship, an angel investing bootcamp for women that connects its fellows with women-led social ventures in an effort to bring more women into angel investing. Recently, the 2014 bootcamp based in Washington, DC, chose to invest in Hip Chick Farms, a startup founded by Serafina Palandec and her partner, Jennifer Johnson. Working out of their family farm in Sebastopol, CA, Hip Chick Farms makes organic and sustainable frozen chicken products. I got the chance to talk to both Oberti Noguera and Palandec about their experiences.
When I asked Oberti Noguera what prompted her to launch the Pipeline Fellowship, she gave me a very representative example of the imbalance of representation in angel investing: an angel group once invited her to a meeting where she was one of two women, and one of two people of color in the room. “It was very heteronormative. We went around the room and all these guys said something similar to, ‘Well, my girlfriend or my wife and her friends think this.’ It was obvious that the knowledge of connection to women was in the room, but what was missing from the room was the women themselves.” Scenes like this happened over and over she couldn’t just feel angry and frustrated with the dismal demographics anymore. She wanted to make a direct change. “[The Pipeline Fellowship] is how I’m going to get more women into the angel investing ecosystem and make it more diverse,” she told me.
The fellowship is made up of three components: education, mentoring, and practice. By the end of it, the fellows select a woman-led-for-profit social venture to invest in. “Social venture” can be defined however each bootcamp wants. Oberti Noguera gave her personal example of a traditional tech startup headed by queer black women. “I think about intersectionality every day, because that’s life. We need to disrupt what social entrepreneurship could mean, and that’s a social venture. We’re creating positive impact by increasing funding that is going to underrepresented populations.” The Pipeline Fellowship itself was and still is a social venture, committed to “changing the face of angel investing.” Its fellows come from various backgrounds: some women are entrepreneurs who could’ve used a similar program when they were launching their businesses, some had never considered angel investing before, some are in their late twenties, some are 60+. Oberti Noguera herself makes a point to introduce her queer identity whenever she is invited to speak at conferences, to further disrupt the assumed idea of what an expert angel investor looks like.
“Changing the world is gendered,” Oberti Noguera told me. In her experience, she’s met many women who had a hard time getting funding for their for-profit ventures. When investors hear about a venture to change the world headed up by a woman, they assume that it’s a non-profit — when they’re told that it’s for profit, they often opt to wait until the sister non-profit is launched. Disruptive for-profit business models that do succeed — for example, the Toms model of donating a pair of shoes for every pair purchased — are led by white guys. There’s not much space in fundraising for women entrepreneurs to be equally disruptive, to “do good and do well,” and the Pipeline Fellowship makes that space a little bigger.
On the startup side of angel investing, the Pipeline Fellowship is already a much-welcome resource for founders like Palandec, who encountered her fair share of sexism and homophobia in investor meetings before she discovered the Pipeline Fellowship. Though the idea of running a farm startup that sources organic, non-GMO-fed, sustainably- and humanely-raised chicken is vastly appealing to me and many queer women I know, Hip Chick Farms is still a niche startup in the already niche industry of health food. Skepticism was high until Palandec met with the DC Pipeline Fellowship, which has been an “incredible experience.” In fact, Fellow Kelly Keenan Trumpbour was so impressed she ended up joining the Hip Chick Farms Board. In a blog post, Trumpbour wrote, “Did I see the chance for profit? Yes. Did I believe in the women on the team? Absolutely. Do I crave chicken nuggets like a sixth grader who wants to avoid growing an extra limb from eating them? Definitely.…my favorite companies make a profit while improving the world around them.”
As far as changing the world, Hip Chick Farms tries to pay it forward by working with other female-owned farms (they source some chickens from Mary’s Chickens) and queer-supportive vendors. However, Palandec pointed out that there are only a few farms that raise their chickens under the standards that Hip Chick Farm tries to uphold, which makes it hard to be too choosy. Ultimately, Hip Chick Farms wants to provide more healthy, environmentally conscious and sustainable food options. She’s hopeful about both goals. Not only have they secured funding through the Pipeline Fellowship, but they’ve also entered into a distribution agreement with Whole Foods. “We want to go from regional to national distribution,” she said.
On that note, I asked her about accessibility. While a partnership with Whole Foods is great for business and for investors, only people who live near and can afford Whole Foods will get to buy their “gourmet, artisan frozen products,” intended for “time-crunched families.” What about low-income families? Or families in places far from a Whole Foods (like my hometown in North Carolina)? Had they considered an affordable CSA as form of local distribution? Palandec told me they were more interested in national, trickle-down solutions. Some major grocery chains have already expressed interest in bringing Hip Chick Farms to their mainstream customers nationwide. She’s also set her sights on schools. She believes that introducing their products to school cafeterias will normalize the sustainable and natural foods movement, as well as directly educate children and their families, which would increase demand — and from there, more farms will change their standards, more markets will carry natural foods at lower costs, etc. At the same time, Hip Chick Farms’ success will help the Pipeline Fellowship and boost queer female visibility in the startup world.
Though the depressingly low success rates of startups came up in both conversations, Palandec and Oberti Noguera were decidedly optimistic, which is maybe a requirement when you’re in the startup world. When I asked them for advice for queer women who might be interested in social entrepreneurship, they both advised optimism and perseverance. “There’s a reason people get into this,” said Oberti Noguera. “There’s a lot of freedom. I get to be my own boss, I can change my job title tomorrow if I want to.” For Palandec, having finally met the right investors through the Pipeline Fellowship after countless discouraging meetings, the key is “not to listen when people tell you no.” Hopefully, with more women coming into the industry, more female entrepreneurs will have more access to resources and opportunities to make a bigger impact in the world.
If you’re interested in finding and investing in women-led social ventures, Pipeline Fellowship applications for spring 2015 in Ann Arbor, Atlanta, Austin, Boston, Chicago, DC, Detroit, Memphis, Miami, NYC, Philadelphia, Pittsburgh, and St. Louis are open now!