Women entrepreneurs are still far behind their male counterparts when it comes to raising capital and building large-scale companies: Only 4% of businesses owned by women generate over $500,000 in annual revenue. So successful female-led companies like Rent the Runway—which has secured $116 million in funding since it was launched in 2009 and is projected to generate $80 million in revenue this year—are a source of great inspiration to would-be women entrepreneurs.
Today, Rent the Runway is partnering with UBS’s philanthropic initiative, Elevating Entrepreneurs, to launch a competition called Project Entrepreneur. These companies are inviting women who are in the early stages of launching a business to submit applications online at projectentrepreneur.org.
Jenny Fleiss, Rent the Runway’s cofounder, believes the problem is that women aren’t well enough connected to networks of capital and advisers who can help them tackle some of the fundamental issues that arise when starting a business. “We are really excited about having an opportunity to support female entrepreneurs who are trying to create scalable companies,” Fleiss tells Fast Company. “We’re interested in companies going after big dollars, big missions, big visions.”
While there will be a monetary component to the competition, the main goal of Project Entrepreneur is to equip women with the tools and advice they will need to thrive in the marketplace. In October and November of this year, Project Entrepreneur will offer free educational summits in New York, Austin, and Washington, D.C., where women will have the opportunity to hear from Rent the Runway’s cofounders and workshop their business ideas. Then, in April 2016, 200 competition finalists will spend a weekend in New York, and the top three winning teams will each receive cash prizes of $10,000 and a spot in a five-week accelerator program.
In Fleiss’s view, women tend to be more realistic or conservative in their projections about their companies and their careers. “It often also means that when they do start a company, they don’t go for the billion-dollar idea,” Fleiss says. “They go after the $50 million or $100 million idea, which is not how VCs have in the past funded companies. They are looking for the next Amazon or Uber.”
While Fleiss says that this trend is changing, and that investors are willing to consider business ideas with more modest goals, she thinks that women should feel empowered to dream big. Part of the goal with Project Entrepreneur is to spur women to pursue ideas that have the potential to scale into massive, industry-changing companies.
Another problem, Fleiss points out, is that female entrepreneurs struggle to translate the value proposition of female-oriented products to rooms full of male investors. While women represent a huge market for products and services, it can be hard to convince men that a business idea is really worthwhile.
While Rent the Runway has been a huge success, Fleiss says that it wasn’t easy to transform the concept of renting expensive gowns into a full-blown business. She and cofounder Jennifer Hyman had to overcome their share of biases when trying to pitch their idea to male VCs.
“The idea that women need so many new items for each new event is just incomprehensible to most men,” Fleiss says. “They really didn’t understand the whole phenomenon of a ‘closet full of clothes and nothing to wear,’ which every woman can relate to.”
Fleiss and Hyman decided that it would be best to convince investors by showing the idea at work. They brought racks of designer gowns to college campuses to rent out in pop-up shops and filmed women’s reactions to the concept. They showed these videos at meetings with VCs and they worked like a charm. “It demonstrated the emotional connection that women have to fashion and the enthusiasm they had for our product,” Fleiss says. “With male investors, we found that it is much better to show, not tell.”
This is the kind of advice that Fleiss hopes to share with women entrepreneurs who are just starting out. Her other pearls of wisdom include urging women not to wait until they have written a perfect business plan before going out to market, but focusing instead on launching their minimum viable product, then tweaking it as they learn more about what consumers want. Fleiss also believes that women should take advantage of every single opportunity to leverage their network to secure funds. “We had a theory that we should pitch at every meeting,” Fleiss says. “If you are opportunistic about it, you will wind up with a strong network of people who can be very helpful to you.”