03.31.2017People

Closing the gap

By: Lynn Staggs
Susan Lyne

We’re celebrating Women’s History Month by highlighting women who inspire and motivate us. The 2017 theme for Women’s History Month is ‘Honoring Trailblazing Women in Labor and Business’ so we thought it made sense to share stories about women associated with Verizon Ventures – our corporate venture capital group that works with up and coming innovators in a variety of industries, technologies and market sectors.

A successful business leader on her own, Susan Lyne now helps other women become successful business leaders. Susan has had a long career in media, commerce and consumer products with leadership positions at companies of all sizes and stages before she led AOL’s brand group. In that role she was stunned to find that female founders were shut out of venture capital. So she sat down with a female co-worker at AOL and developed a business case for investing in women. Today she’s president and managing partner of BBG Ventures, which is an early stage investment fund that backs consumer tech startups with at least one female founder. BBG Ventures grew out of AOL’s #BUILTBYGIRLS initiative and is backed by AOL.

What was the motivation behind starting BBG Ventures?

We saw a few things that suggested a new investment opportunity. Women have always been the dominant consumers, but recent data showed that women were increasingly the early adopters and power users of new tech platforms and services. At the same time, we were seeing a wave of female entrepreneurs launching companies, women who were reimagining every aspect of home and work life to make it more efficient, more productive or just more fun. Established venture capital firms weren’t picking up on it – and that’s still the case today. We thought, “Let’s back the best of these female founders, who inherently understand the end user – what she needs, what she wants, what will delight her.”

What most surprised you as you grew your business?

One of the biggest surprises was how quickly we developed deal flow. Women are natural networkers  we tend to share information and resources with colleagues and friends. But it was still surprising how quickly word spread. And it hasn’t stopped. Since we launched we’ve seen more than 1,400 companies with female founders.

What was the best advice you got while setting up your business?

The best advice came from other women who had launched their own funds. Aileen Lee, a former partner at Kleiner Perkins and now founding partner at Cowboy Ventures, warned me not to create too many rails around our investment guidelines. She said it’s fine to define areas of focus but don’t rule anything out because the most interesting startups are often ideas that no one’s considered before. In other words, businesses that don’t necessarily fit into a neat category.  She said the minute you say, “we don’t do X”, you limit your sightlines. And she was right. Along with ecommerce and mobile services that target female consumers, we’ve backed a B2B agricultural marketplace, a recruiting platform that uses neuroscience and AI to match jobseekers with hiring managers and a co-working space/social club for millennial women – none of which would have made it onto an ‘areas of focus’ slide.  

One of the biggest surprises was how quickly we developed deal flow. Women are natural networkers - we tend to share information and resources with colleagues and friends.

What advice would you give to someone who wants to start a business?

No business, no matter how successful it may look from outside, has gotten there without serious bumps in the road. As good as your idea is, you will face days when nothing is working. You need tenacity and grace, conviction and an open mind. But it’s worth it.

What different advice would you give women, if any?

I tell them that just like Ginger Rogers  who did everything Fred Astaire did, just backwards and in high heels – you are going to be held to a higher standard. To get financing, you may be asked to prove your sector expertise, you may need to deliver stronger metrics and you may be asked to take a lower valuation than a man would get for the same business results. It’s not fair, but you can deal with it  because your own standards are even higher. 

What unique qualities do you think women bring to leadership?

Women are natural problem solvers and that’s an asset both internally and externally. On a strategic level, it means we look for solutions to consumer pain-points that can be the basis of new products and services. Internally, as team leaders, it allows us to listen to multiple viewpoints, find the common ground and move to a resolution.

Who inspires you and why?

Megan Smith, the CTO of the United States under President Obama. When Megan talks about science, she makes me want to join NASA or become a physicist. She can make the most arcane subject accessible or make the most mundane device seem mysterious. I have literally traveled across the country to hear her speak. She’s a national treasure.

Where would you like to take your business next?

We’d love to see BBG Ventures have a material impact on the gender ratio in tech – at least in the startup world. In early 2017, the venture capital database, PitchBook, released 2016 investment data and the story looks pretty grim. Venture capitalists invested $58.2 billion in companies with all-male founders while women received just $1.46 billion. (The story looks a bit better when you factor in mixed teams.) The disparity is due both to the gap in number of deals and the average deal size by gender. If we believe that a diverse ecosystem of entrepreneurs will drive better solutions to the world’s problems  and I think we all do  then access to venture capital has to broaden. Capital follows success, so strong returns and some good stories will get a lot of other VCs looking more closely at women-led startups. We think BBG Ventures can be a positive proof-point in driving that change.

About the author(s): 

Lynn Staggs is a communications professional at Verizon with a passion for technology and the people who make it happen.