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A Venture Capital Firm Led by 2 Women Plans to Introduce a $150M Seed Fund

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October 18-20, 2023 / Tucson, AZ
The annual summit for research institution gap fund and accelerator programs, including proof of concept programs, startup accelerators, and university venture funds

The Story

More than a year after striking out on their own, the founders of Aspect Ventures are preparing a formal introduction of a sizable fund.

The firm plans to announce on Thursday that it has raised about $150 million for its first investment fund, a large sum for a two-founder venture capital firm.

Perhaps just as notably, it is one of the most prominent Silicon Valley firms led by women, at a time when the clubby world of venture capital has been criticized for a lack of diversity.

The recent gender-discrimination trial against Kleiner Perkins Caufield & Byers by Ellen Pao, a former junior partner, has highlighted the overwhelmingly male population within venture capital circles and a drop in female venture partners from the last tech boom.

Aspect’s founders, Jennifer Fonstad and Theresia Gouw, bring notable bona fides to their new firm: Ms. Fonstad was previously a partner at Draper Fisher Jurvetson, and Ms. Gouw was a partner at Accel Partners.

Both women had spent more than a decade at their respective former employers, among the elite members of the venture capital world. But ultimately, the two said that they wanted to return to helping fledgling companies grow, choosing to focus on seed and Series A rounds, usually the first significant financing that entrepreneurs take from institutional investors.

(Industry data appears to support this. The amount of money in seed-stage investments declined 32 percent in the first quarter this year, while that for early rounds was down 34 percent, according to the National Venture Capital Association.)

“I really wanted to get back to company-building,” Ms. Fonstad said in an interview. “What seemed to be missing in the market was a focus on Series A.”

She and Ms. Gouw, who have known each other for years, had begun more frequently discussing creating a firm with that emphasis on early-stage investing and on companies that can take advantage of mobile technology. By February 2014, they had founded Aspect and embarked on their first investments.

Around Labor Day last year, the two began looking to raise money for Aspect’s first fund, finding time to pitch themselves to prospective investors in between scouting for office space and hiring employees. They wrapped up the fund-raising process by the end of March, ahead of a self-imposed deadline: the birthday of Ms. Fonstad’s son.

“It was very much an efficient part-time process,” Ms. Gouw said.

Thus far, they have made over a dozen investments, including in companies like Birchbox, the highly popular cosmetics seller, and the Muse, a career-advice website aimed at millennials.

Ms. Fonstad contended that in setting up Aspect, she and Ms. Gouw were doing something that so many of their male colleagues had done. Yet in making their case to both investors and entrepreneurs, the two also note what they say are advantages in a firm where women are selecting investments and sitting as directors on start-ups’ boards. (That said, Aspect has already hired both men and women.)

Ms. Gouw said that nearly half of the start-ups that Aspect examined had at least one female founder. She added that she had been able to spot potentially lucrative investments like Birchbox that other traditional firms had missed.

And the newer crop of entrepreneurs can relate to having a female perspective in the boardroom, particularly to offer feedback on female customers and other issues.

“Entrepreneurs who themselves want diversity of thought on their own boards, they’ll want that among their investors as well,” said Sukhinder Singh Cassidy, the founder and chairman of the shopping start-up Joyus and an investor in Aspect. “We are seeing a flight of entrepreneurs toward a more diverse perspective.”

via A Venture Capital Firm Led by 2 Women Plans to Introduce a Fund – NYTimes.com.

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