Founder and CEO of Portfolia Funds Trish Costello believes that we are on the verge of a whole new way to do venture capital, “What I call VC 3.0,” she says, and it will be marked by a wave of women investing in companies making products and services that women want to see in the world. How will this new age of VC dawn? Read more here to find out...
Portfolia recently launched its sixth fund, which targets the Femtech space: female products and services that focus on improving women's health and wellness. These include smart breast pumps, health and wellness, vaginal rejuvenation and fertility-tracking devices. “From the very beginning, when we built Portfolia, it was all about activating women investors around the companies we want in the marketplace,” says Portfolia founder and CEO, Trish Costello. “We initially launched an active aging fund and found solutions to menopause, bladder control, and pelvic health. We started seeing all these opportunities that had little to do with old age and a lot to do with women’s health specifically.” And so Portfolia created the first Femtech fund in the nation to address this need, drawing on the expertise of doctors, scientists and healthcare investors to source deals and vet startups. Current investments include Joylux, a vaginal rejuvenation device; Madorra, a non-hormonal treatment to address vaginal dryness; and Sandstone Diagnostics, a fertility-tracking company.
Follow the money
Last year, CB Insights estimated that more than $1 billion has been injected in the Femtech space since 2014. Here are some examples of Femtech startups that are backed by VCs. “These are companies that are priced right, venture backable and can generate great returns,” adds Costello. “And there are hundreds to choose from!” When you see the investment opportunities in this space, it’s hard to believe that it has taken this long to disrupt women’s health. But seeing as more than 90% of investors are men, it’s not that surprising, especially when they refer to the Femtech space as a “niche” market -- when in fact it concerns more than half of the population. “The issue has been on the venture capital side but also on the Angel side,” says Costello. “We know that investors are more likely to invest in areas where they have a personal understanding of the product.” Granted, relating to a breast pump or a menstrual disc can be trickier for a man.
“When you look at the fertility space, however, it generates more interest as men have a part to play in it.” Having more female VCs is key, as is getting more female limited partners (LPs) involved. Melinda Gates recently gave an interview where she talks about the importance of having more women LPs. “Melinda’s leadership on this is going to be huge as she is investing her own money,” says Costello. “Unfortunately, a lot of the institutional money, like pension funds, is still controlled by men.”
It’s encouraging to see more and more startups tackling this space as they try to modernize products and services in women’s health. Although the speculum was created in the 1820s, entrepreneurs are only now beginning to rethink its shape and function. Same goes for the breast pump. “Naya Health, which created a much lighter and practical breast pump, was the first company we put on the Portfolia platform,” says Costello. And there are so many other products and services related to women’s health that are waiting to be disrupted -- one of which is the screening process for breast cancer. “You know there’s technology that can change that,” adds Costello.
To invest in the Femtech Fund, accredited investors must invest a minimum of $10,000. Experts in the field will then handpick the best startups in the U.S. and diversify the investments across 6-10 companies. Each startup will end up raising between $50,000 to $500,000, depending on the stage. Just 7% of venture capitalists at the top 100 firms are women. “At the end of the day, we are intent on changing that mix by helping more women learn that they can directly impact their marketplace by learning to smartly invest in the companies they want to see in the world. Portfolia investors enjoy the engagement component of being an Angel investor, with the diversification of being in a venture fund,” says Costello, “and we think that’s just smart venture investing.”
Portfolia backed UnaliWear's Kanega Smartwatch Helps Elders Stay Independent
Featured in PC Magazine, Jean Anne Booth shares the inspiration of the company...failing to find a fashionable tracker for her aging mother, she simply made one herself. The Kanega watch uses “medical alerts and operator call-back for falls panic and dementia-related confusion; and GPS for getting people home safely via jovial, step-by-step instructions.” This is a perfect example of women intimately knowing their markets, seeing a business opportunity and taking matters into their own hands to develop a winning solution. Learn more about Unaliwear and their watch here https://bit.ly/2L1STU8
For more information on how you can make markets by investing in the companies, products and solutions you believe in, sign up to attend one our upcoming FemTech introductory calls or simply begin by signing into our platform today.
As many of you know, Portfolia believes the best way to support female entrepreneurs is to get more women investing in them. We’ve designed a smart venture investing platform to do just that. We are not the only ones who think this.
Take a recent Globe & Mail article "Venture capital firms have a gender problem. Here’s how to fix it" by Michelle McBane, senior investment director at MaRS Investment Accelerator Fund, managing director of StandUp Ventures and Portfolia partner and thought leader. Michelle says, "We have to invest in female entrepreneurs. When female founders exit, many of them will recycle their capital and expertise back into the startup ecosystem." She adds, "Investing in women entrepreneurs isn’t just the right thing to do, it’s also the smart thing to do." Much of what Michelle highlighted as a featured panelist at our recent "Market Makers" event in Toronto, Canada is covered in this article. Read more here.
Take action: As we opened our 6th venture fund, The Portfolia FemTech Fund, legislation changed allowing us to increase the number of investors in our funds from 99 to 249. This means more people investing in entrepreneurial companies, with the potential to make a much greater impact in our markets, while realizing uncommon returns. Join us!
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"'The chance of getting pregnant in a single month is only about 20 percent in a healthy couple,’ says Dr. Jennifer Conti, clinical assistant professor of obstetrics and gynecology at Stanford University School of Medicine. ‘Even when they're doing everything right.’ ’Infertility is often seen as a woman's problem,’ says Dr. Michael Eisenberg, associate professor of urology at Stanford University. ‘But only about one- third of infertility cases are women, 30 percent are men and 30 percent of the time it's both.’”
Portfolia backed company Trak is directly addressing this problem through their male fertility test. To learn more about Trak’s fertility test check out this article and sign up for our next FemTech call to learn about innovative fertility technology: https://bit.ly/2Mt9d0x
"Melinda Gates has been making headlines by investing in female-founded venture capital firms. She’s addressing the lack of money for female founders by putting her money where her mouth is. If you’re an accredited investor, you can, too.
Venture funds with women as decision-making partners are far more likely to invest in women-led companies, and businesses founded by women delivered higher revenue — more than twice as much per dollar invested — than those founded by men, making women-owned companies better investments for financial backers. Portfolia funds provide diversification and have six noteworthy features...."
As Kristin Nielsen shared in Broadsheet "Recent Bloomberg analysis of the latest stats about female founders makes it clear that, when it comes to women and VC money, not much has changed: Only 12 of the 250 largest venture capital deals in Q1 of this year went to female founders and all-women founder teams (up from nine in 2015)."
At Portfolia Funds, a small female-led venture investing firm, we passionately believe that one of the most potent ways to mitigate gender bias is to invest in gender-balanced entrepreneurial companies who are bringing products that women want and need to the marketplace. We also believe that underserved markets present the most significant opportunity for returns - FemTech allows us to both improve the quality of life for women by backing entrepreneurs in Women’s Health, and to provide a more robust opportunity for returns.
The reality is that men all too often invest in entrepreneurs that look just like them. And why is that important? Because women see market opportunities that men pass by. To open up new markets, bring out new products and get strong companies off the ground, we need more women...
Portfolia Funds, innovative venture investing platform, just announced the launch of its sixth fund. The Portfolia FemTech Fund will invest exclusively in emerging technologies, products and services focused on improving women's health and wellness.
Frost and Sullivan recently published a report stating that FemTech will be a $50 billion market by 2025. Spurred on by rapid innovation in the health space, a positive regulatory environment and the fact that women now control 80% of healthcare decisions in the U.S. household, FemTech is predicted to be the next big disruptor in the global healthcare market. While the benefits of FemTech are widely recognized, the market is still at an early stage.
Portfolia, which was founded to help women learn to become angel investors, announced its first exit, OtoSense, in May. It returned more than 2x to investors, but the investment is just two years old. OtoSense applies artificial intelligence to the analysis of sound. It has applications in home health care -- is that a baby crying or just someone yelling? -- but also in manufacturing, where it can help determine if a machine needs some type of repair or upkeep.
Each of Portfolia's funds concentrates on a specific sector, and can accommodate a maximum of 99 investors. They invest in "areas where we know women are the buyers, even within corporate," says Trish Costello, the founder of Portfolia, which she says "almost always" backs gender-balanced teams.
People often ask us how to evaluate the companies that we come across. Below are the categories we use to evaluate incoming companies, or opportunities, for potential investment. If you know of any early-stage companies that meet these qualities (or have friends that do), send them our way via our referral page. For a deeper dive, sign up to join us on our investment platform. Happy deal hunting!
One of our favorite questions to ask of our entrepreneurial start-ups is “Why Now?”
Portfolia-backed company, 4Degrees, which just secured additional funding (Congrats!), uses artificial intelligence (AI) to improve your competitive advantage when managing professional relationships. Given that Steve Levine from Axios just reported that a recent McKinsey report shows early AI adopters may gain an “insurmountable advantage” and that “companies failing to quickly embrace AI to improve growth, risk falling further and further behind” we think that’s a good idea -- and a timely one at that.
If Trish Costello, CEO of Portfolia since 2014, has her way, there will be no financial cliff where founders of tech startups catering to women and girls can fall to their financial ruin.
Her goal is specific and clear: 100,000 women to invest in Portfolia funds in five years. The recently launched FemTech Fund will invest directly or indirectly in equity-related securities of early-stage companies in the U.S. FemTech marketplace. Costello’s latest push is healthcare-related companies.
The goal there is to raise a minimum of $500,000 and a maximum of $3 million to invest in institutional systems and services that enable or support the health of women and girls.
Collette Courtion, Founder and CEO of Portfolia-backed FemTech company JoyLux, shares how they're redefining women's sexual wellness in Fast Company's This Vaginal Device Pomises to Fix Women's Sex Lives. "Women are becoming far much more empowered to embrace their health in all parts of their life,” says Courtion. Joylux found that 50% of respondents reported bladder leakage issues, and when asked if they were interested in a home solution, a whopping 95% answered yes. “That tells me that it’s an underserved market,” says Courtion.
While Femtech is predicted to be a $50B industry by 2025, only 1.4% of venture capital is invested in it. Sign up to learn more about our open FemTech Fund.
Portfolia, Inc., an investment organization largely comprised of women, received important news at its investor summit in Boston last month: its first exit. OtoSense, which Portfolia invested in two years ago, was acquired by Analog Devices.
“We popped open some champagne,” Portfolia Founder and CEO Trish Costello tells Women’s PE Briefs. Terms of the transaction were not disclosed, but Trish said Portfolia generated nearly 2.5-times its money on the exit. Based in Palo Alto, OtoSense is a developer of sound recognition software that turns sounds and vibrations into actionable meaning.
When it comes to entrepreneurial investing, the incredibly talented women on this list are actively reshaping the landscape for the better. Throughout their domains — from angel to impact investing — they are innovating traditional approaches to backing early-stage companies, busting norms, and establishing new metrics for success. They not only represent the new face of investing, but they also have bold visions for its broader future.
Portfolia is pleased to announce its first return to investors with the acquisition of OtoSense, an artificial intelligence company for sound, by Analog Devices.
Portfolia launched the Rising Tide Fund in late 2015, in partnership with Next Wave Impact Ventures. The fund invested in the company's Series A round in Spring 2016. The company's acquisition will deliver a more than 2X return in two years for Rising Tide Fund investors, an impressive result under traditional venture capital and angel investing models.
I was asked to speak at Portfolia and the Angel Capital Association event in Boston this year. I have been asked for several years and this year I made the journey for the day. Truth is, I had no idea how large these organizations are and the impact that each of them has made. I left insanely impressed.
Trish Costello is recognized globally for her pioneering work in preparing general partners in venture capital, through the prestigious Kauffman Fellows Program which she co-founded in 1995 at the Kauffman Foundation and led for over a decade. Now with 550+ Kauffman Fellows in 50 countries, Kauffman Fellows hold some of the most prestigious leadership positions in venture capital and collectively deploy over $200B. From its inception, over 25% of Kauffman Fellows have been women and represent many of the women leaders of the venture world, including such luminaries as Jennifer Fonstad, Adele Oliva, Rise Stack, Trae Vassalo, Karen Kerr, Jodie Jahic, Bedy Yang, Lisa Skeete Tatum and Susan Mason. Trish went on to lead CVE Capital Corp, the holding company of the first Venture Capital Fund of Funds ($1B under management) created to endow an educational institute, and to found Portfolia, an innovative national platform of Venture Capital Funds Focused in Women’s Markets.
Trish was on the start-up team of the Kauffman Foundation’s entrepreneurial efforts, leading the Foundation’s efforts in eco-system, venture capital and resources. She also led its programs for women entrepreneurs and investors. She was an advisor to the Clinton and Bush administrations and led the National Science Foundation’s SBIR Commercialization Task Force.