One woman who made a $1 million impression
Ever call a credit-card or utility company with a simple billing question only to be put on hold for many minutes, subjected to the Muzak version of "Don't Be Cruel?"Skip to next paragraph
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It's a scenario Christina Bauer hopes to erase through the launch of her Boston-based company, Mindful Technologies.
The start-up firm is designing Web-based software that lets customers interact instantly online with virtual service reps, instead of wasting time on hold. If customers go to a given company's homepage, they will be greeted by a multilingual animated representative who answers their questions and even guides them through the website.
Ms. Bauer's concept will get a chance to fly thanks to funding from a handful of venture capitalists and "angel" investors. She recently sealed a million-dollar-plus commitment from a Boston venture-capital firm after presenting her ideas before hundreds of deep-pocketed firm-backers last November.
The event was run by Springboard, which hosts events nationwide to help women entrepreneurs speed the funding process along. The organization puts investors - who are mostly men - in closer touch with businesswomen, and spotlights the successful roles women have played in building the economy.
Venture capital has been difficult to obtain for many women entrepreneurs. Only about 5 percent of women-led businesses received such cash infusions last year despite the fact that they head 51 percent of start-up companies. In fact, women entrepreneurs are spearheading start-up firms at twice the rate of men, according to the Center for Women and Enterprise.
Many women who run start-ups take a "bootstrap" approach, growing their business slowly, based on profits and loans, Bauer says.
A fourth-generation entrepreneur, she has done better than many of her peers largely because of her persistence. Since starting the company a year ago, she's worked seven days a week pitching her business model to investors, many of whom she located through Web searches. Bauer concedes that raising money hasn't been easy.
"I learned that you need to choose people who are appropriate for your [business.] If someone says no, I ask them, 'how would you make my company better?' " she says.
Giving investors time to get to know her has proved fruitful, though it took many months to cultivate relationships. Bauer says she started her business with few contacts and little exposure to the venture-capital world, a common problem for women entrepreneurs.
"It's not a question of prejudice, it's a question of proving women can attain a bottom line," she says. "The more the story gets out there that women are already running businesses that are very profitable and growing quickly, [the better]. There are many women-owned companies out there knocking the ball" out of the park.
For those women who struggle to raise venture capital, Bauer recommends alternative solutions. Entrepreneurs, for instance, could ask part-time employees, lawyers, or developers to donate their services in return for equity. After the company establishes a track record, use that information to attain venture capital, if needed. (Granted, that approach has become a harder sell given the market performance of many recent start-ups.)
A similar approach has helped Bauer. She received free consulting from The Rhythm of Business, an "incubator" organization that helps start-up firms write business plans and create investor presentations.
Bauer now has enough seed money to launch her software within six months. Yet she's still searching for an additional $2 million to $3 million to build her staff from the current four people to about 30. More employees, she hopes, would build momentum to help Mindful be profitable within 18 months. (The company has also signed up its first major customer, but she won't say who it is.)
Bauer hopes to close out her final round of fundraising within the year. She and her staff aim to build a $100 million company, which they see as a tangible goal, considering the nationwide demand for improved customer service and the money companies could save by not having to hire more service reps.
Between now and then though, Bauer plans to continue calling around, attending events like Springboard, and leveraging the contacts she's made over the past year.
"I call being an entrepreneur 'Die Hard' with a business plan," she says. "In the movie, Bruce Willis ... has got to get up to the top floor of the building to kill the bad guys. He doesn't know how he's gonna get there, but he knows that he's never gonna give up. That's what it's like being an entrepreneur. At every stage, there is always a new challenge."
(c) Copyright 2001. The Christian Science Publishing Society