Crowdfunding

A Crowdfunding Site for Women Entrepreneurs That Pays it Forward

Anne Field | November 22, 2016

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During many years spent shivering in the stands while watching her kids play on one sports team or another, Maria Valente wished there were a way to get a cup of coffee or hot chocolate without leaving the game. Talking to another young mom, she realized she was not alone in that simple desire. That’s how Valente, the owner of Chocolations, a 10-year-old shop in Mamaroneck, NY (pictured above) where she creates and sells her own artisan chocolate creations, got her latest idea: a food truck that would stop at local kids’ athletic games selling coffee, hot chocolate, some of her own goodies and other treats.

To get her idea off the ground, she applied to iFundWomen, a new rewards-based crowdfunding platform for women-owned entrepreneurial ventures. Valente’s Chocolations Gourmet Truck is among an initial 20 or so ventures raising money on the site.

karen-cahn-ceo photo credit-vproud tv
Karen Cahn of iFundWomen (photo credit: VProud.tv)

Founded by Karen Cahn, iFundWomen aims to address the funding gap for female entrepreneurs.  Women account for more than a third of all US business, yet they receive just 2-6% of venture capital funding, according to the site. And they tend to start their companies with half the capital that men raise.“The gap is too extreme of an issue not to do something about it,” says Cahn. It’s a Kickstarter-like platform through which individuals make donations and get various items in return, depending on how much they give. A $100 contribution to the Chocolations truck campaign, for example, will get you 15% off purchases for a season and three gourmet chocolate bars of your choosing.

IFundWomen is targeting very early stage startups that need the funding to help finance a pilot, a minimum viable product or other early endeavor. Once the women raise that money and get their enterprises off the ground, they can then try for a seed round from other sources. (Women with male cofounders are also welcome to apply.)

“Success on a crowdfunding site is an absolute data point and indicator that a company is ready to make that next step,” says Cahn. The site charges the usual fee of about 5% on transactions, but reinvests 20% of the fees into live campaigns on the platform. The site also encourages women entrepreneurs who raise money on the site to “pay it forward” by supporting other campaigns.

Cahn also wants to target what she calls the “confidence gap” that entrepreneurs of all stripes face when trying out crowdfunding. To that end, the platform provides various services to help women become crowdfunding ready, including free coaching. In particular, she finds that women tend to be reluctant to toot their own horn. So Cahn, who is a former long-time Google employee and a videographer, among other achievements, produces top-quality videos for women to use on the site. (Cahn launched VProud Labs, a video production company, two years ago; iFundWomen is a subsidiary).

The site will also help with such matters as how to do a budget, conduct an email marketing campaign and other steps needed to make crowdfunding successful. (One tip: Make sure friends and family donate in the first 48 hours, so you show immediate response. “People want to bet on a winning horse,” says Cahn.)

Ventures wishing to raise money on the site are vetted and can’t participate unless they meet basic requirements. For example, applicants have to address such issues as their background, why the product is important and how they plan to spend the money. If they don’t meet those parameters, Cahn will ask entrepreneurs to resubmit an application after they’ve addressed specific points.

The initial ventures on the site speak to women’s issues. They include SheWorks Collective, a shared workspace, event space and community for women entrepreneurs in New York; Software Safari, a mother/daughter engineering team that makes interactive educational apps for kids and their parents; and NEED/DONE, a parent-based peer network that helps parents find trusted sources for child and home-related tasks.

Anne Field is a New York-based journalist who writes about social enterprise and impact investing. A version of this article originally appeared on her Not Only For Profit blog on Forbes.com.

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