By Melissa Repko The Dallas Morning News
WWR Article Summary (tl;dr) Finance professionals Louise Kee and Laura Baldwin share why they began investing with "Golden Seeds", a New York-based early-stage investment firm that's focused on women-led startups.
The Dallas Morning News
Investing in startups has become a side project for finance professionals Louise Kee and Laura Baldwin.
They are part of the Dallas leadership team for Golden Seeds, a New York-based early-stage investment firm that's focused on women-led startups. As part of their role, they advocate on behalf of Texas startups and hold office hours at University of Texas at Dallas, where they advise aspiring entrepreneurs.
Since 2005, Golden Seeds' over 275 members have invested around $90 million in more than 85 women-led ventures.
That includes four investments in Texas. Investors can be women or men, but startups must have a woman in the C-suite to be eligible for funding. All Golden Seeds members must be accredited investors and must invest a minimum of $25,000 per year. Golden Seeds offers investor training about topics from vetting startups to calculating valuations.
Kee and Baldwin spoke recently about why they began investing with Golden Seeds. Their answers have been edited for brevity and clarity.
Why did you begin investing in startups?
Kee: I came from a corporate background, and I was looking for some other types of investments. When I heard about Golden Seeds, I really liked what they were doing with the focus on women-owned and women-led companies. It's been about six years for me.
Baldwin: I did my first investment through Golden Seeds about five years ago. In the back of my mind since I was in my 20s, I've always wanted to start a company, and it just never worked out. There came to be a time in my life when I thought 'Maybe I could do that.' I mentioned that to some friends and said, 'I think it'd be interesting to start a company' and one of them said, 'Why don't you invest in companies instead? I'm a member of this group called Golden Seeds and you should take a look at it.' I did and I really got hooked on it, so that's my passion now -- investing in companies rather than starting one.
What inspired you to join Golden Seeds? What was it about the mission or the ideas?
Kee: The companies we see truly are going to make a difference in this world. They are truly going to change people's lives. I can tell you about dozens of them, but I picked out one of them. It's called Cognition Therapeutics. I was first introduced to them when I joined Golden Seeds, and they were an early-stage company trying to find a treatment for Alzheimer's. ...Five years later, they're progressing, and they're now in clinical trials. It's companies like that that really make a difference. It's inspiring to hear their stories.
Also, women don't get funded at the same rate as men. I really felt like there were some good opportunities out there to invest in women-led companies that were overlooked by other groups. I do believe that's true.
Baldwin: I joined because of the focus on investing in women and getting a return on my investment. The member network and the people I've met are great, too. When I go up to New York [to Golden Seeds' headquarters], I have dinner with a lot of members and have made a lot of friends and met people with all different areas of expertise, which is great when you're evaluating a startup.
Women are outnumbered when it comes to both investing and starting companies. Why do you think that is? Kee: There's a phenomenon where people tend to invest in people who are like them.
Baldwin: In 2004, 5 percent of startups applying for capital for startups were women, according to the UNH Center for Venture Research. Last year, it was 30 percent. In terms of percentage of women-led startups who receive capital, it was 3 percent in 2004 and 22 percent last year.
Kee: It's interesting. The more women investors you've got, the more women entrepreneurs are funded. Or maybe it is vice versa. But you can literally track the graph.
What are some of the barriers to women getting funding for their startups?
Baldwin: A lot of investors tend to think 'This is a women entrepreneur. This is going to be some women's company, women's product or something. I'm not interested in that.'
Kee: But that is not the case with us. We see women doing nanotechnology and medical devices and robotics and battery technology. That's the perception, but it's not the facts.
What are red flags when you're looking for startups to invest in?
Kee: One thing I learned my first month of Golden Seeds is companies should heed the advice that investors give them because investors have seen a lot of deals and seen a lot of companies. Some companies tend to dismiss it. They think 'I know better.' They are not coachable.
At this point, I'd imagine you both have startups you've invested in that have folded. What have you learned from them?
Baldwin: One of the companies that I invested in had a great entrepreneur and it seemed like a great story. Then, there were some issues and she had to pivot. One of the things she did, which was great -- and I don't think I've seen this with any other companies -- is she held a call afterwards. It was kind of a lessons learned. It took a lot of courage. She said 'This is what happened. We're sorry this happened.' -- LOUISE KEE Age: 62 Hometown: Born and raised in University Park, lives in University Park Education: Bachelor's degree in management from Tulane University and MBA from Southern Methodist University Personal: Married with three adult children
LAURA BALDWIN Age: 44 Hometown: Born and raised in Fort Worth; lives in the Uptown neighborhood of Dallas Education: Bachelor's degree in Plan II (a honors program for liberal arts) from University of Texas at Austin and MBA from Southern Methodist University Personal: Single