Potential Startup "Femtech" in the Eyes of Investors

DailySocial noted that there are at least 12 startups that have female founders or female C-Level ranks who have pocketed funding throughout 2019. Not only startups with products targeting women, but also those providing SaaS technology, healthtech, to social commerce.

"This fact shows two interesting things, that more and more women are starting startups and that more and more investors are looking for and investing in women-led companies. I hope this trend will continue to increase as these two factors become clearer," said Director GK Plug and Play Aaron Nio.

While investment decisions are usually gender-independent and depend on the capabilities and qualities of the founders and execution of the business model, many advantages are claimed only to have female leaders.

In the Kartini Day edition, DailySocial trying to find out the interests and expectations of investors regarding female startup (femtech) leaders in Indonesia.

Making a social impact

The interesting thing about startups founded by women is that most of them build businesses that have a social impact. Starting from a marketplace that embraces more women to own a business to beauty services and products that empower women to become partners.

"We have found and have had several dialogues with female-led startups from different categories. Starting from social commerce, healthtech in specific areas such as genetic startups and consumer wearables to aqua culture. We are clearly seeing more women taking leadership roles to solve Indonesia's health and social problems," said Justin Jackson, SEA Manager of Pegasus Tech Ventures.

Pegasus Tech Ventures has invested in several Indonesian startups founded by women. Among others are Populix (Eileen Kamtawijoyo), CloudCash (Windy Natriavi), alive (Diajeng Lestari), and Infradigital (Beautiful Maryani).

In general, female-led startups usually have a more organized, structured, and empathetic culture.

East Ventures understand this potential. This venture capital firm has invested in Base (Yaumi Fauziah), Greenly (Liana Gonta Widjaja), Nusantics (Sharlini Eriza Putri), Fore (Elisa Suteja), and Sociolla (Christian Indiana), Nalagenetics (Astrid Irwanto & Levana Sani).

"Until now we have had approx 10% female founders in our network and we are grateful to have worked with them and look forward to increased representation. They are certainly extraordinary individuals, whose work deserves respect," said East Ventures Partner Melisa Irene.

Some VCs have a bias towards startups that want to have a positive social impact openly on the grounds that the market is still small or the founders are not sufficiently focused on shareholder needs. However, judging by the success of startups that have a positive social impact, more and more VCs are interested in investing in startup profiles like this.

"Women's leaders are proven to be able to build teams that are more collaborative, transparent, produce faster and more creative solutions. They can create a more reliable and trustworthy work environment," said Jungle Ventures Investment Team Karissa Adelaide.

Female startup leader challenge

Although the opportunities available to women leaders are increasingly diverse, there are still some challenges that are difficult to avoid, including the low number of female founders or limited access to capital. On the other hand, the income earned by female leaders tends to be less than that of male leaders.

"Women entrepreneurs still often encounter obstacles, not only in Indonesia, but other countries in Southeast Asia. Until now, many of them are still struggling to get support and capital. As a result in the technology sector women are still under-represented and underpaid," Karissa said.

Another challenge that is still happening is that the government's support is still not maximal in paving the way for entrepreneurs and women leaders to build businesses. One way that can be done is to encourage more young women to have a desire to have a business that targets the technology industry, not only the creative industry.

"Female founders are great role models, both when it comes to new ideas, and how they create and grow their teams. We've seen strong friendships and incredible partnerships among women entrepreneurs. One of the most admirable traits of a female founder is to meet and talk to other founders to share tips for success," said Rajan Anandan, Managing Director of Surge and Sequoia Capital India.

The names included in the East Ventures portfolio such as Grace Tahir (Medico), Amanda Cole (CEO of Sayurbox), Marianne Rumantir (Co-Founder Member), Cynthia Tenggara (Parenting Head Orami), and Gita Sjahrir (Co-founder Ride) have emerged as a mentor and role model for women entrepreneurs in Indonesia. Of course women's leadership is not limited to the role of mentor high profile.

"Of Digitaraya we are seeing more and more female founders in our community. Our portfolio consists of more than 100 budding alumni, 54,95% have a female founder or co-founder. This is truly a remarkable achievement for female entrepreneurs, and we only hope that the number continues to grow," said Digitaraya Managing Director Nicole Yap.

Startups that have at least one female founder are said to usually offer a higher level of trust and the ability to assemble and manage teams to deliver results. They also tend to provide more data-driven projections, accuracy, and are more open to new ideas.

Investor support for female leaders

Indonesia is one of the countries in Southeast Asia that many investors are looking for to invest. Various programs and activities were launched by related parties to support the startup ecosystem. Investors claim to support and welcome the growth of startup businesses founded by women.

"At Jungle Ventures we recognize that we can and should be a catalyst. We are proud to have started and have some strong and innovative companies led by female founders in our portfolio, but we are not complacent. We have a vision to empower a generation of entrepreneurs innovative, motivated and determined women in Southeast Asia and Indonesia," said Karissa.

Another support provided by investors is connections and communities that can help women leaders meet and share experiences. This is considered the most ideal to foster self-confidence and a strong ecosystem for female leaders.

"Of Indian Sequoia and Surge, we want to create a safe community for female founders to connect, work and support each other through their entrepreneurial journey. Through Sequoia Spark, we hope to help other founders gain access to the right parties who care about their success, and are certainly willing to invest," said Rajan.

The same thing was also conveyed by Investment Analyst and Office Representative CyberAgent Capital Indonesia Kevin Wijaya. They often hold casual chat discussions with the local startup community. In this activity, female founders or aspiring female entrepreneurs can ask questions about the right way to get funding from VCs.

"To support more women entering the technology industry, the team also often recommends startups, including CyberAgent's portfolio, to recruit more women into the organization. This is done so that diversity in startups can occur positively," said Kevin.

Activities such as competitions and partnerships with related parties can also bring out new potential in the ecosystem, which is expected to be enlivened by female founders. This step was taken by Pegasus Tech Ventures to see firsthand the potential of startups.

"We held the Startup World Cup Indonesia competition in partnership with Wild Digital last November 2019, and 30% of the top finalists came from female-led startups. We see this number will increase every year. In addition, we also see more companies active in pipeline we come from a female-led startup," said Justin.