For the most part, crowdfunding campaigns are run one of two ways: backers either receive a product in return after they give their money, or the feeling that they’ve done something good for the world by donating to a charity or worthwhile cause. Usually, though, people donating to a cause give only a few dollars, with those dollars tax deductible, but to give $1,000 they won’t even get a cent of back? Not many entrepreneurs are bold enough to ask people to do that.
Except that’s exactly what Canadian entrepreneur Vicki Saunders is asking of 1,000 women around Canada. Through SheEO, an organisation dedicated to helping women entrepreneurs, Saunders is asking 1,000 women to commit to ‘An Act of Radical Generosity’ – that is, to donate $1,000 each to create a $1 million fund that will be distributed among 10 women-led ventures.
These 10 ventures will be selected by the backers from a list of 25 finalists, and the funds given to the ventures as a zero percent loan expected to be paid back over five years. The repaid loans will be recycled, put back into the fund to distribute among a new crop of businesses rather than returned to backers.
Saunders, who has worked in venture capital, said the idea spawned from the fact that “we keep trying to fix women.”
“We say they’re not bold enough, they’re not trying hard enough, or they’re not building the kinds of businesses that matter. I have done five startups and found that no matter what I did, it still wasn’t good enough. I started a company that went from idea to IPO in five years and still it wasn’t good enough; they wanted to make my partners co-CEOs with me because they’re more comfortable with men,” she said.
While the VC industry keeps searching for unicorns, Saunders said, our economies are made up of small businesses, many of them capital-efficient, quick to become profitable, and run by women.
“These businesses are missing out because they’re not part of the unicorn narrative,” she said.
Rather than trying to fix women, SheEO wants to actively support them by tailoring the experience to them and actually addressing their specific needs.
“I had worked with a lot of accelerator and incubator programs and found young women really struggled with them. There’s a big bro culture in most of them, and again, this obsession with ‘go big’. It’s not that women don’t want to go big, but it’s tough to fit in, you know, there’s always Lego and beer night, for example. The women I saw were asking me different questions to the men, asking how to create networks and how to create success in their own terms,” Saunders said.
For these programs, SheEO gathered ten women angels, who each contributed $5,000 to create a $50,000 pool to distribute amongst ten women entrepreneurs. The most interesting part? SheEO asked the entrepreneurs to decide how to distribute the money amongst themselves, with the only two stipulations being that the money could not be distributed evenly and could not all go to one person.
“I know as a default that, as a woman, if I was in a room with nine other women I had developed close relationships with, I’d want it to go evenly. But that’s not necessarily the best approach. Both times we’ve done it, everyone got money,” Saunders said.
She also found that the women were happy to sit down with each other and go over their budgets line by line, item by item to see who already had something they needed that they could loan out, or who knew somebody who could get them a discount.
The networks developed through the programs became invaluable, and this is another idea that SheEO’s new campaign is working with. After news of the crowdfunding goal broke, Saunders said SheEO received inquiries from around the world from people wanting to contribute. However, Saunders was adamant about keeping this first campaign in Canada in order to create communities and networks of women who could give localised support to the first 10 founders.
SheEO’s website states: “Every month, we will send out a summary of the needs of the 10 selected ventures so interested individuals can open up their network, use their buying power or share their experience to help the businesses.” Workshops and networking events will also be held for the startups selected by the campaign backers.
Any men interested in committing an Act of Radical Generosity will be asked to come back for the next campaign, with SheEO wanting to see whether an all-female experience will help convince more women to get involved.
With applications for ventures open and the top 25 finalists to be picked in mid-September, Saunders expects the campaign to be oversubscribed, and is already planning for the launch of the campaign on a local level in 10 cities around the world next year.