Startups Led by Women Entrepreneurs Increase

Posted in News by Ben Worsley


While startups continue to receive early stage investments, small businesses continue to wait for the next coronavirus relief bill.

Every year, Masterplans publishes a White Paper called “State of Startups,” which highlights trends amongst our clients and their projects. (You can read our most recent report here.)

In our research, we look at reports from other organizations so that we can understand how our clients fit into a larger context. One of the most comprehensive reports for Angel & V.C. investments is the Venture Monitor from Pitchbook and National Venture Capital Association (NVCA). In addition to breakdowns of venture deals by industry, amount, and round type, the report also looks at demographics of founders.

Historically, the realm of startups has been dominated by men, but that’s beginning to slowly change. According to the January 2020 Venture Monitor report, companies with at least one female founder has steadily increased over the last decade.

We still have a long way to go, but as this week’s entrepreneur investment report shows, women-founded startups are flourishing. (The first three of the startups listed below are women founded.)

New Startups Get Funding

Women’s health startup Stix has developed discreet direct-to-consumer pregnancy and ovulation tests. The founders noticed that, while many men’s health products offer discreet delivery (think hair loss and erectile dysfunction), women were still forced to visit a drug store for a pregnancy test. The company received seed funding of $1.3 million from BDMI and Founders Factory New York, amongst others.

Parade sells underwear D2C made from breathable and recycled fabrics in countless styles and colors, all available in extended sizes. The inclusive and body-positive brand recently received $3 million in seed funding from Lerer Hippeau and Vice Ventures.

Ceresa has developed a mentoring program to promote diverse leadership within organizations. The company developed a curated, data-driven assessment of its mentees’ experiences, goals, and challenges to connect them with the “perfect” mentor. While the structured program lasts nine-months, the journey continues with the supportive Ceresa alumni community. In addition to working directly with individuals, they company also promotes leadership development to both large and small companies. Ceresa recently received $1 million in early seed funding from LiveOak Venture Partners and Next Coast Ventures.
Low- and No-Code continues pique investor interest. Cashdrop makes it easy for small business owners to create online stores. In less than 15 minutes, a small business can post its menu of products and begin taking transactions. Restaurants are likely the primary audience for the product, especially with the huge fees that delivery apps charge. The unique point of differentiation for Cashdrop is that the app charges a fee to the customer for the transaction instead of the business, currently set at 5%. Based in Chicago, the company has 200 merchants. They received $2.7 million in funding from Harlem Capital and Founder Collective that will allow the 7-person company to add to its team.

Contactless food ordering brings us another new concept from Minnow Technologies. Akin to an Amazon locker but for food, its Pickup Pods are targeted at food halls and cafeterias. Users order their food from the app, and once the order is filled, they pick it up from their secure pod, unlocking the door via a smartphone link. End-to-end, there is no contact with touchscreens or keypads. Their model falls under the trending “hardware as a service” model where the company provide the equipment, the software to operate it, and maintenance for a monthly fee. The Seattle-based startup received $2.2 million in seed funding from Elevate Capital and Portland Seed Fund.

I’m about the only person at Masterplans who doesn’t have a cat. So on behalf of most of my coworkers, I introduce you to Smalls, which makes “Real Food for Cats.” In addition to having a website with pretty playful cat drawings, they also have developed a comprehensive menu specifically designed for the nutritional needs of cats. And also the pickiness of cats. So it’s about options, options, and more options, all on subscription for as little as $1 per day. Smalls recently announced a Series A round for $9 million from Left Lane Capital and Founder Collective.

Small Business News

The next coronavirus relief bill is still at an impasse, leaving small businesses in a lurch. The key point of disagreement comes down to Pandemic Unemployment Assistance. The Democrats want to continue the $600 per week amount, while the Republicans argue it disincentivizes workers from seeking employment. A deal is not expected this week.(CBSNews)

Earlier today, the Department of Labor published its July jobs reports, which beat forecasts. The unemployment rate is now 10.2%, down from 10.6% in June. Many of the new jobs came in hospitality. (Yahoo Finance, Politico)

The jobs report came on the heels of yesterday’s weekly unemployment claims announcement. New claims for unemployment dropped to 1.2 million for the week ending Aug. 1, the lowest number of new claims since the start of the pandemic. While this is the number on which the news media seems to focus, as I’ve said before, the number economists watch is continued unemployment claims. Encouragingly, the number of continuing claims fell by 900,000 this week, meaning 900,000 people who filed for unemployment last week didn’t file this week (New York Times).

Remember the Federal Reserve’s Main Street Lending Program? As a refresher, the Fed set up a low-interest loan facility primarily targeted towards midsized companies with over 500 employees. In their update to Congress, they revealed that the program only provided eight loans totaling $77 million so far. It appears the issues come down to extensive paperwork for applicants and banks alike, the fact that the money is debt and not grants, and most significantly, that the program can’t lend to companies with high debt ratios. In other words, the program is strictly for companies that are asset-rich but lack cash flow, and clearly the demand for that isn’t as strong as was anticipated. (Politico)

Senator Rubio, who chairs the Senate Small Business Subcommittee, proposed an amendment to the republican bill that would extend the PPP through the end of the year. In the original bill, a second PPP would require a the company showing that revenue has declined by 50% over 2019, but the new amendment, which is expected be voted on tomorrow, would decrease that amount to 35% . As a reminder, this is just the republican bill, but since small business has strong bipartisan support, we are likely to see consensus here. (Zachary Warmbrodt of Politico via Twitter)

As we await the new PPP, we are still getting changes to the old PPP. Another round of FAQs was posted on Tuesday. The big clarification was regarding owner’s salary forgiveness. The new rule caps the forgivable amount of the owner’s salary at $20,833 across all businesses that owner has stake in. This amount assumes a 10.6 week or longer covered period; if the covered period is shorter, the cap is reduced commensurately. (Forbes)


Ben Worsley is Marketing & Communications Director at Masterplans

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