BBG Ventures, now eight years old, is a New York-based seed- and early-stage venture firm that only supports founding teams that feature at least one woman, just in capital for its third fund Locked $ 50 million, a big jump for its first two funds, both of which are $ 10 million in size.
A determining factor in large funds is that BBGV, formerly exclusively supported by AOL (now Verizon Media), now has a wider pool of institutional and individual investors, including the State of Michigan Retirement Systems, George Kaiser Family Foundation And Verizon Ventures, along with Poshmark cofounder Tracy Sun, Classpass cofounder Payal Kadakia, and venture capitalists Aileen Lee, Theresia Gow, and Jennifer Fonstad.
The young firm also has a track record to point out. Although investment in peer space has taken the wing an unexpected turn, hurt by a national lockdown and internal upheaval, other stakes are rising, including e-commerce platform Zola; Feminine hygiene brand Lola; And Spring Health, a mental health benefits platform for employers that recently closed on $ 76 million in Series B funding led by Tiger Global Management.
This is not saying anything about the huge and underlined opportunity to invest in women-led teams that BBV’s founders, Susan Lynn and Nisha Dua, believe that most venture firms are still fully appreciated Don’t.
We talked earlier today about why this is the case with Lynn, former CEO of ABC Brand, former CEO of Martha Stewart Living, and former CEO of AOL Brand Group; And Dua, a former lawyer, management consultant, chief and founder of Linne’s staff. Our conversation has been edited for length.
TC You have raised $ 50 million. What size check are you writing? Do you want to take larger positions or do you have a more diverse view?
ND: We are looking at writing a $ 500,000 to $ 1 million check. We seek 7.5% to 10% ownership, and we are open to co-leading, but we prefer to lead. We have already led the first round with this fund. We will probably fund about 30 companies from the fund to mix pre-seed and seed-stage startups with reserves for fund-on funding.
SL: We have actually made 11 investments; We started investing after the first shutdown.
TC: You have invested in about 80 startups over the years. What has been your biggest investment so far?
ND: Planet Forward, founded by Jum cofounder Julia Collins.
TC: Do you have – or will you ever build a special purpose vehicle to invest more in a startup that enables your fund?
SL: We did not do this for our previous fund, but we did our first for this fund in a company called SPV Starface, a skincare company that uses a very different approach to the acne problem. You have probably seen gold stars [that its customers apply to their pimples] On social media. They are growing very fast and recently did a series A and we did part of it ourselves but we also opened an SPV for one of our LPs.
TC: What are you interested in now?
SL: We have invested a lot in health and wellness. This is our biggest category. The second is the future of work and education; The third is climate-friendly commerce; And the fourth is actually more or less consumers. In all those areas, we have actually found that there are many, many, many women founders who are active and building great companies
ND: Also, we [have historically] Described itself as a consumer fund, but we are doing more B2B in this fund, where we think the B2B approach can solve a big consumer problem, with many millions of consumers Are also included.
TC: What do you mean is an example of this?
SL: Gracie, who Aldercare is doing and actually selling to the employer as employee benefits. If you look at the cost of companies due to the number of hours and days that many people invest in caring for an older parent or trying to figure out what the next step is for them [you appreciate the need for this kind of service]. This platform not only allows you to connect with someone who can help you plan, but also points you to the resources you need, including financial resources, legal resources and living resources.
ND: Another is Full Harvest, a marketplace and logistics platform that takes all excess food on a farm that does not meet cosmetic standards and remodels it to juice and salad makers and other food brands and manufacturers.
TC: You mentioned Julia Collins. Do you know how many entrepreneurs have you repeated for the first time?
ND: There is a mixture. We do not have priority.
TC: What is your geographic focus?
SL: I would say, New York City is definitely our primary source for companies for many reasons, including that there is a very rich and active female founding community here. It is the headquarters of many different types of industries, so you get many talents here. But we have also invested in San Francisco companies in San Diego, companies in Los Angeles, Milwaukee. [We see] Opportunities in at least a dozen cities across the country.
TC Have your syndicate partners changed over time, if at all?
ND: This is one of the most exciting things of the last few years. We love partnering with women’s GPs – people like Cara Norton of Upfront Ventures and Jess Lee of Sequoia. The female GP that emerges from these top venture funds has a large spider child that can form these strong relationships and eventually leads to a follow-on round.
TC: Do you think women-led teams are getting the ratings they were doing for all-male teams? I was horrified to read earlier today that the pay gap between men and women has increased by 8 cents in the last 25 years.
SL: I cannot speak officially about whether women are getting undervalued across the board. We definitely know that they are getting a very low percentage of venture capital investment. If you look at the statistics about the amount of money for women in 2020 vs. men, it certainly bothers and shows that the vast majority of venture capital is still going to all-male teams. I think some of them are due to the megoids we have seen, but this is not enough to make a significant difference.
ND: I think it was the Harvard Business Review that did some really interesting research  The phenomenon that disrupts ClearTips which largely suggests that men are judged on their ability and women are often judged by their current character, and we [might] Overcome that [these factors] May have to do something with the valuation.
So we are round. We see opportunities for these women-led teams – and we have the opportunity to assess them based on their exact qualifications.