Equity Crowdfunding Site Targets The Gigantic Untapped Consumer Market

Women control 80% of consumer spending. “Yet they’re largely overlooked as potential investors and market-makers,” said Portfolia Founder and CEO Trish Costello.

Women control 80% of consumer spending. “Yet they’re largely overlooked as potential investors and market-makers,” said Portfolia Founder and CEO Trish Costello.

Gery Stengel | March 26, 2014 | Forbes – If you want more women entrepreneurs to get equity financing and more women to invest in entrepreneurs, give them a tool they want — something simple to use that allows them to dabble and learn before they go all in. Oh, yeah, and someplace where they can collaborate, communicate, and share, which they love doing.

That’s just what Portfolia, a crowdfunding site is doing. Now it’s just for accredited investors but when the rules and regulations for Title III of the JOBS Act get sorted out, unaccredited investors can participate, too. Portfolia is not some pink site just for women but because women — both entrepreneurs and investors — are more frustrated by the current angel crowdfunding sites, they are, in a sense, the gold standard for “user-friendly.” If you please them, you’ll please men too.

Portfolia is focused on crowdfunding for companies that sell to consumers. That’s a $12.5 trillion market now which is projected to grow to $18 trillion in the next five years, according to the Boston Consulting Group. Women control 80% of consumer spending. “Yet they’re largely overlooked as potential investors and market-makers,” said Portfolia Founder and CEO Trish Costello. “Portfolia seeks to create a new class of women as consumer-investors, and connect companies directly to them, leveraging their combined buying power and substantial social reach to move markets and accelerate growth.”

Men are welcome as entrepreneurs and investors on Portfolia. In fact, the first company that raised money on the site was pawTree, high-quality pet food. It’s run by a guy.

There are other equity crowdfunding sites, but they’re mostly doing B2B deals, according to Crowdnetic, which tracks Private Issuers Publicly Raising online (full disclosure I’m working with them on several projects). AngelList is the biggest equity crowdfunding site. On AngelList, you’re judged by the size of your investments, which is pretty intimidating to women. Only one half of 1% of accredited women investors have invested. Of course, money matters on Portfolia but so does your ability to provide feedback about the product and spread the word about it. The size of your investment isn’t the only thing that makes you high-value.

At the Launch Festival this past February, a panel of venture capitalists reviewed 40 companies. Launch is a media and events company aimed at entrepreneurs and investors founded by Jason Calacanis. For four of five, the top choice was Portfolia. Here’s why:

“VCs are woefully under-informed about how the female consumer works, thinks, and behaves,” said Joyce Kim, Freestyle Capital. “They make judgement based on their wives and these women are not the normal consumer.”
This is the #1 complaint I get from the hundreds of women entrepreneurs I’ve interviewed, said Vivek Wadhwa, academic, researcher and entrepreneur. “When they [women] go to angel forums and the like, they feel intimidated and left out … They need their own place to feel comfortable.”
“I think you’re [Portfolia] really on to something with tools that enable companies to leverage their investors … You need to get value out of these people beside just their capital,” said Jay Levy, Zelkova Ventures.
“AngelList is a proven model,” said Don Dodge, Google Ventures. “It’s [Portfolia] a better designed AngelList.”
Even Adeo Ressi, The Founder Institute, who didn’t choose Portfolia as his top choice, but his second said, “there is a shameful bias in Silicon Valley against women, period.”
read more: http://www.forbes.com/sites/geristengel/2014/03/26/equity-crowdfunding-site-targets-the-gigantic-untapped-consumer-market/

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