By Chris O’Brien (Business & Technology Columnist, San Jose Mercury News)
Something happened last week in Silicon Valley that was remarkable simply because nothing about it was remarkable. Well, almost nothing. On Monday, a stealth startup announced it had raised $7.3 million from a prominent venture firm. The deal hinged on the long-term relationship between the founder, a serial entrepreneur, and a venture capitalist who has become a leading figure in e-commerce startups. They had worked together in the past and had become cornerstones of each other’s networks over the past decade.
In other words, it’s the kind of thing that happens every day in Silicon Valley — except for one crucial detail: They’re both women.
And that makes the story of Joyus founder Sukhinder Singh Cassidy and Accel Partners’ Theresia Gouw Ranzetta worth highlighting. That such a deal is still such a rarity is a sad commentary on the state of Silicon Valley. But it’s also instructive because it shows how women may yet find a path to more equal footing in the overwhelmingly male and clubby environs of the tech economy.
It won’t likely be through policy changes, or even culture shocks. It will be less revolution and more evolution. It will happen one deal at a time over many years as influential women like Singh Cassidy and Ranzetta build powerful networks of their own.
“The valley is all about relationships and people who you’ve worked with,” said Ranzetta.
Indeed, Ranzetta has led venture investments in several companies founded by women, including ModCloth. And she can point to a handful of similar deals, such as a recent venture round raised by the two female co-founders of Ones Kings Lane that was led by Aileen Lee of Kleiner Perkins.
That said, such intersections between a prominent female VC and a founder are rare.
A 2008 survey by the National Venture Capital Association reported that only 14 percent of directors, partners and principals at VC firms were women. And according to a recent study by Vivek Wadhwa, a research director at the Center for Entrepreneurship and Research Commercialization at Duke University, women start 3 percent of tech companies and account for less than 5 percent of IT patents.
A dreary picture, and yet, one that’s still brighter than it was a decade ago when Ranzetta and Singh Cassidy first crossed paths.
In 1999, Accel invested in Yodlee, an online personal finance company co-founded by Singh Cassidy. Ranzetta had just joined Accel as an associate, and while she wasn’t the lead investor in the deal, she was tasked with serving as a mentor and adviser on strategy and possible deals.
That was the start of a strong mutual respect and friendship that endured, even after Singh Cassidy left Yodlee a few years later to become an executive at Google (GOOG). Meanwhile, Ranzetta rose to become a managing partner at Accel and someone I listed as one of the 10 most powerful women in Silicon Valley in a column last year.
When Singh Cassidy left Google in 2009, she moved over to Accel as an entrepreneur in residence, where she helped evaluate deals and began to consider her next startup. Singh Cassidy joined someone else’s startup last year, but left after deciding she’d rather pour her time and passion into her own idea.
That idea turned out to be Joyus, which essentially is a platform that combines videos and social media to drive e-commerce. A brand can create a channel there that will include short, infomercial-type videos produced by Joyus that show regular folks using and talking about a product.
When Joyus was ready to raise its first round of venture capital, Singh Cassidy pitched only Ranzetta. Singh Cassidy said there was simply no other VC who knows more about e-commerce, consumer markets and women.
“It was very obvious to me as to who I would go to,” Cassidy said. “Theresia is unique. She really gets it.”
Ranzetta is equally bullish on Singh Cassidy, who she says combines an ability to identify a big vision with the skills to manage a fast-growing enterprise should it catch fire.
“She’s always been able to see something big where nothing exists,” Ranzetta said.
And so, on Monday, Joyus announced that it had raised $7.9 million, including $7.3 million from Accel. Ranzetta will join the board of Joyus as it expands from its current stable of 60 employees.
Of course, both women stress that their extensive networks include men as well. But the latest deal is just one more link, one more bond that will strengthen women’s position in the new networks that will one day, I hope, result in a Silicon Valley where gender is no longer noteworthy.
“It takes time to get more women in the founder entrepreneurial pipeline and the venture investment side,” Ranzetta said. “Now you’ll start to see more of this kind of deal.”
This post was originally posted at the San Jose Mercury News.
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