7th July 2020
Women start 40 percent of the businesses in the U.S., but they receive just 3 percent of venture funding. It doesn’t take a math whiz to recognize that such an extreme funding gap could spell opportunity, but it might help if you are math minded, a longtime investor, and happen to be woman and so conceivably understand certain products and pitches better than some men. That was certainly the thinking of both Lori Cashman and Suzanne Norris, who came together in 2016 to form Victress Capital outside of Boston, a consumer-focused seed- and early-stage firm that just closed its second fund with nearly $22 million in funding to back gender diverse teams, meaning there is at least one woman on the founding team. Cashman is a Duke grad who has spent her career as an investor, including previously cofounding a private equity firm, Linear Capital, to invest exclusively in owner-managed businesses. Norris, meanwhile, who has two degrees from Harvard, has been an investment banking analyst, a management consultant, and spent nearly four years as a VP focused on e-commerce with Kate Spade. The two friendly acquaintances originally joined forces to enhance their “cognitive diversity,” says Cashman, scraping together a total of $2 million from friends and family so they could establish a track record, money they used to fund 14 startups by writing checks ranging from $100,000 to $150,000. A couple of those startups have already been acquired. Moxxly, which sold silent, wearable breast pumps, was acquired by Medela, a leading breast pump maker, in 2017. Last. summer, it was shut down , but Cashman and Norris suggest that investors (another of whom was Randi Zuckerberg) got their money back and that they were happy to see it acquired by what what seemed at the time like a very strong strategic partner. A second portfolio company, Werk, more recently sold to a Chicago-based startup called The Mom Project for undisclosed terms. Others of their bets include Daily Harvest , a direct-to-consumer organic food delivery business that has so far raised $43 million from investors, according to Crunchbase; Mented Cosmetics , a cosmetics company catering to women with darker skin tones that has raised $4 million to date, according to Crunchbase; and Copper Cow Coffee , a young L.A.-based startup that makes organic Vietnamese coffee and has raised $3 million, per Crunchbase. Of course, the idea all along was to raise a larger fund so that as its young portfolio matures, it can invest more into its breakout winners, as well as continue backing startups that are selling products that resonate with Victress or else the infrastructure to support retailers more broadly. In fact, toward that end, Victress — whose newest fund came largely came from family offices — has added to its team in recent years. It brought in Kate Castle, a longtime marketing partner at Flybridge Capital Partners who later cofounded XFactor Ventures as a partner. It also hired HBS alum Madeline Keulen, who previously interned with Victress and is now a vice president. (Because of Norris’s background and network, Victress receives some of its deal from Harvard and HBS and typically brings in HBS students to shadow them and help with due diligence.) It wasn’t easy assembling that team — or the fund. Norris half-kiddingly calls $20 million “no man’s land” in the eyes of institutional investors. Though they are just now closing the vehicle, they began assembling checks for it in late 2018 and have already funded seven startups that represent 25% of their new investing capital. Still, they’re playing the long game and think the relationship-building they’ve done along the way will pay off — both with institutional investors that will be tracking this second fund and with the venture firms around the country with whom they’ve been co-investing and that now reach out to Victress when they are looking at nascent startups with diverse founding teams. A big win would also help, of course. While it’s impossible to know now whether they’ll have one, the team seems particularly excited about a Minneapolis-based startup that they’ve backed called Rae that makes what it markets as libido-enhancing vegan vitamins and that not only sells them directly to consumers but has shelf space at Target, a retail giant that has remained open throughout the pandemic. It’s very valuable real estate, and Rae was able to secure because its cofounder and CEO, Angie Tebbe, spent the previous 12 years as a senior director in merchandising where she was responsible in part for overseeing the private label products in the chain’s beauty and wellness aisles. Rae’s products are also priced affordably — it costs $14 for a 30-day supply. That’s important to Victress, too, incidentally. The team is focused on tech-enabled consumer services, marketplaces and digitally native brands. But if a startup in the last camp wants its attention, it had better also feature an “authentic, accessible price point for majority of America,” says Cashman. “That’s important to us.”

Victress Capital, a fund founded by women to back women founders, just closed its second fund

Published
Women begin 40 p.c of the companies within the U.S., however they obtain simply 3% of enterprise funding. It doesn’t take a math whiz to acknowledge that such an excessive funding hole may spell alternative, nevertheless it may assist if you’re math minded, a longtime investor, and occur to be girl and so conceivably perceive sure merchandise and pitches higher than some males. That was definitely the considering of each Lori Cashman and Suzanne Norris, who got here collectively in 2016 to type Victress Capital outdoors of Boston, a consumer-focused seed- and early-stage agency that simply closed its second fund with almost $22 million in funding to again gender numerous groups, that means there may be no less than one girl on the founding group. Cashman is a Duke grad who has spent her profession as an investor, together with beforehand cofounding a personal fairness agency, Linear Capital, to take a position completely in owner-managed companies. Norris, in the meantime, who has two levels from Harvard, has been an funding banking analyst, a administration marketing consultant, and spent almost 4 years as a VP centered on e-commerce with Kate Spade. The two pleasant acquaintances initially joined forces to reinforce their “cognitive range,” says Cashman, scraping collectively a complete of $2 million from family and friends so they might set up a monitor document. Ultimately, they used that cash to fund 14 startups by writing checks starting from $100,000 to $150,000. A few them have already been acquired. Moxxly, which offered silent, wearable breast pumps, was acquired by Medela, a number one breast pump maker, in 2017. Last. summer season, it was shut down, however Cashman and Norris counsel that buyers (one other of whom was Randi Zuckerberg) acquired their a refund and that they had been comfortable to see it acquired by what what appeared on the time like a really sturdy strategic accomplice. A second portfolio firm, Werk, extra lately offered to a Chicago-based startup referred to as The Mom Project for undisclosed phrases. Others of their bets embody Daily Harvest, a direct-to-consumer natural meals supply enterprise that has thus far raised $43 million from buyers, in accordance with Crunchbase; Mented Cosmetics, a cosmetics firm catering to girls with darker pores and skin tones that has raised $four million thus far, in accordance with Crunchbase; and Copper Cow Coffee, a younger L.A.-based startup that makes natural Vietnamese espresso and has raised $Three million, per Crunchbase. The concept all alongside was to lift a bigger fund in order that as Victress’s younger portfolio matures, it could actually make investments extra into its breakout winners, in addition to to fund different modern younger startups. In reality, towards that finish, Victress — whose latest fund got here largely got here from household places of work — has added to its group in recent times. In February, it. introduced in Kate Castle, a longtime advertising and marketing accomplice at Flybridge Capital Partners who later cofounded XFactor Ventures as a accomplice. In 2018, it additionally employed HBS alum Madeline Keulen, who beforehand interned with Victress and is now a vice chairman. (Because of Norris’s background and community, Victress receives a few of its deal from Harvard and HBS and usually brings in HBS college students as interns.) It wasn’t simple assembling its group — or its new fund. Norris half-kiddingly calls $20 million “no man’s land” within the eyes of institutional buyers. Though they’re simply now closing the automobile, they started assembling checks for it in late 2018 and have already funded seven startups that signify 25% of their new investing capital. Still, they’re taking part in the lengthy recreation and suppose the relationship-building they’ve achieved alongside the best way will repay — each with institutional buyers that can be monitoring this second fund and with enterprise companies across the nation with whom they’ve been co-investing and that now attain out to Victress when they’re  nascent startups with numerous founding groups. A giant win must also assist, in fact. While it’s not possible to know now whether or not they’ll have one, the group appears significantly excited a couple of Minneapolis-based startup that they’ve backed referred to as Rae that makes what it markets as libido-enhancing vegan nutritional vitamins and that not solely sells them on to shoppers however has shelf house at Target, a retail big that has remained open all through the pandemic. It’s very useful actual property, and Rae was in a position to safe it partly as a result of its cofounder and CEO, Angie Tebbe, spent the earlier 12 years as a senior director in merchandising, the place she oversaw the non-public label merchandise within the chain’s magnificence and wellness aisles. Rae’s merchandise are additionally priced affordably, with a 30-day provide of nutritional vitamins costing $14, in contrast with many alternate options that value twice as a lot and extra. That’s partly why Victress is so enthusiastic concerning the startup. Victress is concentrated on tech-enabled shopper providers, marketplaces and digitally native manufacturers. But if a startup within the final camp desires its consideration, it had higher additionally function an “genuine, accessible worth level for majority of America,” says Cashman. “That’s vital to us.”
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Mark Lennihan / AP
Naya Health found difficulty convincing venture capitalists to back its Smart Pump. (Mark Lennihan / AP)
Emily Chang and Ellen HuetBloomberg
Before her first meetings with venture capitalists, Janica Alvarez thought she could have a professional discussion about breasts. Alvarez was trying to raise money for her startup Naya Health Inc., which makes a smart breast pump. Naya has secured approval from the Food and Drug Administration , achieving that milestone much earlier than most young companies. But the conversations weren't what she expected. Investors wanted to know how she'd be able to run a startup while also raising her children. Another commented on her body and asked how a mother of three stays in such good shape. Others said they were too grossed out to touch her product or pleaded ignorance about how a breast pump works. "Investors would say, 'Let me go talk to my sister; let me go talk to my wife,'" Alvarez said. She and her husband, Jeffrey Alvarez, managed to raise $6.5 million from investors after starting the business together in 2013. But they've recently hit a wall. With few VCs willing to fund the product, they're turning to Kickstarter in the hopes of keeping their company running. The campaign, with an initial goal of $100,000, started Thursday. "If VCs don't want this, then we know parents and mothers do," Alvarez said. The U.S. venture capital industry is 93 percent male and facing heightened scrutiny for the sometimes-fraught relations with Silicon Valley's few female entrepreneurs. Alvarez's experience illustrates how getting venture funding can be even harder when your product isn't one men use. The breast pump market is dominated by Swiss manufacturer Medela, which got a boost in the U.S. from an Obamacare mandate that insurance companies must cover the cost of pumps for new moms. Most devices use hard plastic cups and an air suction system. They're often loud and sometimes painful. The Naya's soft suction cup mimics the feel of a baby's mouth and distributes the suction over a broader area of a woman's breast. Alvarez said the Naya delivers 30 percent more breast milk and is 20 percent faster than alternatives, thanks to a unique water-based system. The company is also planning to sell a smart bottle that will be able to track the volume, calorie count and fat content of breast milk and inputs them into an app. Mothers would be able to use the software to monitor how much they're pumping, how much the baby is eating and how much milk is left in storage. Customers are asked to pay a serious premium for those features. The company was selling the Naya for $999 until Thursday, when it lowered the price temporarily to $649. A typical Medela pump is about $250. Naya is now pitching a lower-end model without a rechargeable battery or certain accessories for $399, though the price will go up by $100 eventually. The pump is partly covered under certain insurance plans and is free for military servicewomen. Naya plans to offer rentals in the future for those who can't afford the upfront cost. Despite the price, Naya has won favorable coverage from Wired and the New York Times. There's a dedicated fan base among mothers who can afford it, like Emilee Stucky, a 29-year-old new mom in Wichita, Kansas, with seven-month-old twin daughters. "The comfort alone is worth the investment," said Stucky, who works as a freelance calligrapher. "In a world where pumping is already so inconvenient for women, the Naya breast pump makes it so convenient and so comfortable." Like most VCs Alvarez met with, Charles Hudson didn't know anything about breast pumps. Hudson, a managing partner at Precursor Ventures, said he decided to make a seed investment in Naya after doing some research with moms. "We were expecting our first child, and I started asking around and asked, 'Do you like your current product?'" he said. "Everyone said no." But Hudson acknowledged that Naya's business is a tough sell to many VCs. Beyond being a foreign industry, it requires developing hardware, which can get expensive fast compared with making an app. During one pitch meeting, Alvarez recalled one guy saying, "I'm not touching that; that's disgusting." In another meeting, investors Googled the product and ended up on a porn site. They lingered on the page and started cracking jokes, she said. "I felt like I was in the middle of a fraternity," Alvarez said. "I expect more from grown men." Alvarez decided to start bringing her husband with her to pitch meetings. Unlike the CEO, he said investors never made disparaging comments or asked about the challenges of running a company as a parent. "We made the decision that it would be best if both of us would always go to these meetings," said Jeffrey Alvarez, a longtime medical-device engineer who's Naya's senior director of research development. "They would treat her like a little girl trying to play a man's game." But the couple still couldn't raise money. As cash got tight, the founders asked their eight full-time employees, who are mostly in the San Francisco Bay area, to work for minimum wage, which would buy the company a few months of extra runway. The staff agreed. The Alvarezes, meanwhile, traded their four-bedroom home for a rental that's half the size. Things haven't been much easier for other startups in their small industry. Moxxly and Exploramed NC7 Inc., two other companies building smart breast pumps, are yet to release their pump products. The companies hoped to stand out with features not found in competing devices. Moxxly, which is working on a way to pump discreetly under a bra, sold itself to Medela in June for an undisclosed price. Shortly before Alvarez was set to give a recent on-stage pitch, she ran into a female VC, who offered some advice: Only wear black and gray; don't use nail polish; don't smile or laugh too much; and keep your hair back in a pony tail. Alvarez immediately took off her jewelry and pulled her hair back before giving the presentation. She said: "It's hard when you're told you can't be yourself because you have to play the game."

Mothers love this startup's smart breast pump. VCs don't.

Janica Alvarez and her husband managed to raise $6.5million from investors in 2013 to start Naya Health Inc. which makes a smart breast pump. Naya has already secured vital approval for her device from the US Food and Drug Administration. However, few venture capitalists (VCs) have been willing to invest in their firm. When Alvarez first met with  VCs  she thought that there would be professional discussion about breast pumps. However, potential investors wanted to know how she could run a startup while raising a family. Some asked how she kept in such good shape with three children. Others did not want to touch her product. Alvarez and her husband decided to turn to Kickstarter to find capital to keep their company running. Kickstarter is a US public benefit corporation. Although it is based in Brooklyn New York is has a global crowdfunding platform  to "help bring creative projects to life." Kickstarter is reported to have received more than $1.9 billion in pledges from 9.4 million backers that has been used to fund 257,000 creative projects including films, music, stage shows, journalism, video games and even comics among others. The Naya campaign has an initial aim of raising $100,000 and has just started. Alvarez said: “If VCs don’t want this, then we know parents and mothers do.” The VC industry is male-dominated being 93 percent male. Alvarez situation is made worse by the fact that she is launching a product that men do not use. A breast pump is a device used to extract milk from the breasts of a lactating woman. They have a long history. On June 20 1854 the US Patent Office issued a patent of O.H. Needham a breast pump. Breast pumps can be manual powered by hand or foot movement or electrically powered. There are many reasons breast pumps are used. They can be used to gather breast milk from a woman who has returned to work. The milk is captured in a bottle which a caregiver can later use to feed the baby. The milk  extracted may also be donated to be used by milk banks that provide it to babies who cannot receive their mother's milk for whatever reason. One of the most dominant manufacturers of breast pumps is the Swiss company Medela LLC. Most of the devices use hard plastic cups and air suction. Some are relatively noisy and can be painful as well. There are many different types as this article on Medela products show with costs running to several hundred dollars. The Naya pump uses a soft suction cup that is more like the feel of a baby's mouth. It also distributes the force of the suction over a broader area of the breast, making it likely to be less painful than the harder plastic cups. Alvarez claims that their pump delivers 30 percent more breast milk and is also 20 percent faster than alternatives. She claims this is a result of the unique water-based system used. The firm is also planning to market a smart bottle to go with the pump. The bottle will be able to track volume, calorie count, and fat content of the breast milk. The mother would be able to use software that would track how much milk is being pumped, how much the baby is eating and how much milk was left in storage. The cost however is several times as high as conventional units sold by Medala. The Naya company was selling the units for $999 but has lowered the price temporarily to $649 still a large premium over a typical Medela pump costing about $250. To come close to the price of conventional pumps, Naya also offers a lower-end model with no rechargeable battery and lacking certain accessories for $399 but this is just temporary and the price is expected to rise to $499 eventually. Naya is also planning in the future to rent out the units which will allow those who cannot afford the upfront costs of the unit to use it. In spite of its high price, the pump has had favorable reviews from Wired and the New York Times. Even more significant it has been received positively by many mothers. Emilee Stucky a 29-year old mother of seven-month old twin daughter said:  “The comfort alone is worth the investment. In a world where pumping is already so inconvenient for women, the Naya breast pump makes it so convenient and so comfortable.”
The company is running out of cash and in order to keep working had to ask its small staff of eight full time employees in the San Francisco Bay area to work for the minimum wage until the company was able to raise more capital. They agreed. Two other  startups working on breast pumps, Moxxly and Exploramed NC7 Inc. have yet to even release their products. Moxxly which was working on a way of pumping discreetly under a bra ended up being bought by Medela.

Smart breast pump startup Naya Health searches for investors

Companies developing tech-enabled products and services that primarily serve babies, children up to approximately 12 years old, and their parents. 

Baby and Kids Tech

These startups aim to provide health treatments, diagnosis tools, and products that do not require a prescription or connection with a health professional to enhance personal wellbeing. This includes supplements, women's health maintenance, OTC medicines, and more.

Beauty & Personal Care

The digital health collection includes vendors developing software, platforms, sensor & robotic hardware, health data infrastructure, and tech-enabled services in healthcare. The list excludes pureplay pharma/biopharma, sequencing instruments, gene editing, and assistive tech.

Digital Health

This collection includes companies applying technology to address a spectrum of physical, mental, and social well-being concerns specific to women. Examples include companies in reproductive health, maternal care, fertility tracking, and menopause support. 

Women's Health Tech

Acquired

Moxxly develops a breast pump accessory designed for hands-free pumping. Its pump allows women to pump breast milk with their shirts on, enabling mothers to easily integrate motherhood into their work and life. The company was founded in 2014 and is based in San Francisco, California.

Date	Round	Amount	Investors	Valuation Valuations are submitted by companies, mined from state filings or news, provided by VentureSource, or based on a comparables valuation model.	Revenue	Sources
6/1/2017	Acquired		Medela	$XXM	0 FY undefined	1
6/6/2015	Seed VC		Subscribe to see more	$XXM	0 FY undefined	0
12/17/2014	Seed	$XXM	Subscribe to see more	$XXM	0 FY undefined	10
	Incubator/Accelerator		Subscribe to see more	$XXM	0 FY undefined	10

Date	6/1/2017	6/6/2015	12/17/2014
Round	Acquired	Seed VC	Seed	Incubator/Accelerator
Amount			$XXM
Investors	Medela	Subscribe to see more	Subscribe to see more	Subscribe to see more
Valuation	$XXM	$XXM	$XXM	$XXM
Revenue	0 FY undefined	0 FY undefined	0 FY undefined	0 FY undefined
Sources	1	0	10	10

First funding	Last Funding	Investor	Rounds	Type	Location
6/1/2017	6/1/2017	Medela	1 Acquired	Corporation	Switzerland
00/00/0000	00/00/0000	Slow Ventures	Subscribe to see more	Venture Capital	California
00/00/0000	00/00/0000	Highway1	Subscribe to see more	Incubator/Accelerator	California
		Plug and Play	Subscribe to see more	Incubator/Accelerator

First funding	6/1/2017	00/00/0000	00/00/0000
Last Funding	6/1/2017	00/00/0000	00/00/0000
Investor	Medela	Slow Ventures	Highway1	Plug and Play
Rounds	1 Acquired	Subscribe to see more	Subscribe to see more	Subscribe to see more
Board Seats
Type	Corporation	Venture Capital	Incubator/Accelerator	Incubator/Accelerator
Location	Switzerland	California	California

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