Unicorns Are Dead. Spinsters Are Rising.
Growing up, we understood unicorns to be allusive ethereal creatures, existing in the mystical, lush green forest of fairytales. Unicorns were the stuff of magic and make-believe and certainly did not exist in the worlds of finance, business, and technology. Fast forward to 2018, and of course, we now know that unicorns are, in fact, totally real. As of March 2018, 279 unicorns are known to exist on this planet. They have even names like Uber, Pinterest, and Airbnb.
For those who are still unclear what the term unicorn means, in the startup space, unicorns are privately held startups valued at or over a billion dollars. These companies are named unicorns because statistically, those kinds of high-growth startups are very rare, and well, so are unicorns (we still believe!). When venture capitalist Aileen Lee coined the term back in 2013, only 39 unicorn companies existed. As of March 2018, that number had increased by 7x. Of further mystical surprise, even more magnificent beasts arose from the startup landscape, including decacorns (companies valued at over $10 billion) and hectocorns (valued at over $100 billion).
But this change isn’t just happening because founders are getting better at building high-growth companies, or that investors are getting better at investing. A major problem in the startup space is the overvaluation of startups by investment firms. Adding to that conundrum is that the laws surrounding stakeholder ownership have changed to benefit both startup founders and investors to remain as privately held companies, longer.
While the surge of unicorns may be surprising, the gender or the unicorns, should not be. Over 91% of unicorns around the world were founded by men. That’s right…most of the startup unicorns in existence have exclusively male founders.
The reasons behind this are far from surprising, and have been reported on en masse - especially in the last two years - by plenty of journalists, female founders, and female venture capitalists within the business world. Despite the facts that American female founders launch 1,821 new businesses every day and would be the fifth highest GDP on the planet if they were their own country, they are notoriously left out of the startup space due to cultural and economic realities that put them at a statistical disadvantage compared to their male counterparts.
For one, women founders lack access to capital. Last year, only 2% of female founders were issued any money from venture capitalists. Black women have only been able to raise 0.0006 percent--$289 million--of the $424.7 billion total tech venture funding raised since 2009. This isn’t due to lack of proven worth by female founders either. Women entrepreneurs are statistically just as successful as their male peers in driving revenue. So where is the money going? The widely reported facts around the underfunding of female founders has a lot to do with good ‘ol sexism: there is an attitudinal perception amongst venture capitalists - even amongst female VCs - that women’s ideas and ability to lead a successful company are not as competent as men. Part of this has to do with what bodies are behind the funding decisions. Venture Capitalism is a male dominated industry. In the top 100 VC firms, there are somehow only 64 women out of 752 partners. This means that less than ten percent of the bodies making decisions behind what founders get what, are women. What that further means, is that most of the people making decisions about startups - particularly startups founded by and for women - lack a fundamental understanding of women-centered market spaces and perhaps most problematically, why products designed by and for women would outperform traditional products in the market.
One area where this is glaringly clear is within the female hygiene industry. Until the most recent charge to revamp the female hygiene space - led in part by contemporary startups like THINX and DAME - period products have been severely limited to the same tampons and pad variations women have been using for decades. The last update to feminine hygiene happened in the (1960), when Kotex began to individually wrap pads and add adhesive backing to make them lock in place on panties. Well, they sort of lock into place. Okay, fine. pads have honestly been just one giant game of Russian roulette, especially for the active yogis, athletes, and mere common urban pedestrians amongst us. That being said, the feminine hygiene market is estimated to grow to be as high as $42 Billion by 2022, in part, due to a growing global demand and a desire for new innovations on old products.
Female-founded startups that have been smart enough to develop products with women in mind (revolutionary concept) and take the untraditional route by bypassing private funding, have been finding much success. Especially when it comes to finding alternative paths to funding that negate their company’s dependence on venture capitalism. UK based- feminine hygiene company, DAME, for example, launched their crowdfunding campaign for their reusable, eco-friendly applicator on indegogo, nearly doubling their requested amount to receive a total of 55,000 pounds in pledges. Dame isn’t the only (co) woman founded company finding success from the crowdfunding space. Over the past handful of years, several crowd-based funding companies and organizations have popped up specifically for women, including The Female Founders Fund, which invests in early-stage startups with high potential, and Pipeline Angels, which focuses on training more women and non-binary femmes to invest in - you guessed it - women and non-binary femmes.
Coworking spaces are also seeing women issue an emancipation proclamation of sorts. As one headline put it, If Coworking Spaces Are The Future, They Shouldn’t Look Like A Frat House. Tired of dealing with bro culture of in these coworking spaces, female founders have started to launch their own coworking facilities - just for women. It goes without saying that the demand for these spaces has been nothing short of incredible. One of the first all-female coworking spaces, The Wing, had over 13,000 women entrepreneurs apply since its launch in 2016.
Women are finding that by leaving the traditional systems and working in new, innovative ways through the cracks of Silicon Valley structures, they can succeed on their own terms. This idea of women entrepreneurs defining their own success outside of the gaze of Silicon Valley, or gaining funding through the market vs the mostly male VCs whom they have to fight to get coffee meetings with or have their ideas taken seriously, is a far far cry from a pathway to becoming a unicorn and more along the lines of giving rise to a new kind of startup economy: spinsterhood.
Though the negative modern-day connotation of a spinster is negative, the origin of the word actually stemmed from a term used for girls and women who spun wool — one of the few occupations single women could earn a living from centuries ago. Like the women entrepreneurs of today, the original spinsters funded their own businesses, and like the women entrepreneurs of today, these women found a way to be self-sufficient outside of the traditional but limited path that was set out for them. This entirely new, self-created pathway enabled these spinsters to live lives of independence and autonomy, by removing them from a system that would have otherwise positioned these women to be entirely economically dependent on the whimsical decisions of men.
It’s clear that Silicon Valley has a long way to go before we see more unicorns led by female founders. But whats strikingly clear is that women entrepreneurs are not here to wait around for that day to come. Instead, we’re seeing more and more women making moves to create companies and spaces where female founders aren’t pining for investment dollars, coworking spaces, or resources. Women are realizing we can weave our own way into building successful companies -and economies - through our own communities, resources, funding, and just as importantly, the bond we’re creating through the experience of mutual spinsterhood.