Take One Step Today
By Janice St. Onge, Flexible Capital Fund President
Is your money invested in alignment with your values? How can you find out? What does it mean to invest anyway? Don’t know where to start? Here’s a little secret. You invest your money, your time, your energy every single day. Something as simple as going to the grocery store or local farmers market is an act of investing your dollars.
Investing takes many forms, and shows up in many ways. We invest in food, our home, our children, ourselves, our 401K or retirement plan, our portfolio of stocks/bonds, our savings account, directly in a business or indirectly through a community loan fund or credit union, in Amazon (yes anytime you make a purchase online that’s an investment).
We all know about the gender pay gap, it exists. Overall, women in the US earn 79 cents for every dollar earned by men. In Vermont it’s a little better (a little)… Women earn more – 87 cents for every dollar earned by men. But, it’s still not equitable.
Did you know that Female entrepreneurs receive less than 5% of all venture capital (VC) funding? Despite the fact that the number of female VC’s has increased from 3% of all VCs in 2014 to a “whopping” 7% today, the equity funding gap for female entrepreneurs has only widened. Venture capital investors —over 90% of whom are white men— have a bias toward familiar faces. This bias is not always a conscious one, but it is there nonetheless. And, it is part of the reason why less than 1% of VC financing goes to Blacks or Latinos, and less than 5% goes to women.
Even at traditional capital market investment firms, 86% of investment advisors are men, with an average age of 50+m. So the “gender-neutral” investment industry defaults to men’s salaries, career paths, preferences and lifespans.
The Vermont Women’s Investor Network (WIN) is a new initiative that seeks to empower women, trans and gender non-conforming people to discover and achieve their economic goals in alignment with their values.
- We do this by providing awareness and education for she/her/they investors, in a safe and nurturing environment, about the potential of investing their money for good, and in businesses that provide diverse and equitable opportunities for their customers and communities.
- Our long-term goals include pooling skills, expertise, and capital to help close the diversity gap in funding; supporting local businesses; creating positive environmental and social impact with our dollars; and generating positive financial return.
We are part of a larger collaborative, the Northern New England Women’s Investor Network (NNEWIN), that is a coalition of people in Maine, New Hampshire and Vermont providing opportunities for women to learn about and engage in angel and impact investing and connect with like-minded women and those that identify as non-binary gender. NNEWIN seeks to build investment acumen, wealth, and impact on their communities by increasing capital for early stage companies in the region.
According to a recent article in Green Money Journal entitled Women and the Future of Investing, “Over the next two generations, women are projected to receive 70 percent of inherited wealth in the U.S. As a result, women are poised to have a massive impact on the investment and financial services spheres in the coming decades, and as such, conversations have moved away from stark gender comparisons toward discussions that focus on how the investing world must adapt and embrace women in their own right.”
At VT WIN, we want to be inclusive and help you start today, wherever you are, to use your economic power to invest your dollars in the things you care about. So we’ve put together a list of resources that, while not comprehensive, can help you start investing your money for good, and in alignment with your values. And, this list isn’t just for women and those that identify as women, we think everyone should invest this way!
Glossary of Terms:
Let’s start with a glossary of terms and definitions that might be helpful to familiarize yourself with as you consider the power of your dollars. Following are some basics to get you going.
- Angel Investor – An angel investor (also known as a private investor, seed investor or angel funder) is a high net worth individual who provides financial backing for small startups or entrepreneurs, typically in exchange for ownership equity in the company. Often, angel investors are found among an entrepreneur’s family and friends. https://www.investopedia.com/terms/a/angelinvestor.asp
- Venture Capital – Venture capital is a form of private equity and a type of financing that investors provide to startup companies and small businesses that are believed to have long-term growth Venture capital generally comes from well-off investors, investment banks and any other financial institutions. https://www.investopedia.com/terms/v/venturecapital.asp
- Accredited Investor – Individuals are “accredited investors” if their net worth is at least $1,000,000, excluding the value of their primary residence, or they have income at least $200,000 each year for the last two years (or $300,000 combined income if married) and have the expectation to make the same amount this year.
- Charitable Contribution – A charitable donation is a gift made by an individual or an organization to a nonprofit organization, charity, or private foundation. Charitable donations are commonly in the form of cash, but they can also take the form of real estate, motor vehicles, appreciated securities, clothing, and other assets or services.
- Donor Advised Fund – A donor-advised fund is a little like a personal charitable savings account. A donor creates an account and makes a contribution of cash, stock, or other assets like real estate or artwork and can take an immediate tax deduction for the gift. https://www.philanthropy.com/article/Working-With-Donor-Advised/243282
- ESG – Environmental, social and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. https://www.investopedia.com/terms/e/environmental-social-and-governance-esg-criteria.asp
- Gender Lens Investing – Essentially, it means investing with an aim to earn financial returns and address gender disparities. It’s a subset of “impact investing,” which usually refers to any kind of investing that’s designed to have a positive social or environmental effect on the world (not necessarily just gender). https://www.ellevest.com/magazine/impact-investing/gender-lens-investing
- Impact Investing – Impact investments are investments made with the intention to generate positive, measurable social and environmental impact alongside a financial return. https://thegiin.org/impact-investing/need-to-know/#what-is-impact-investing
- Main Street Investor – Main Street can be thought of as representing us as everyday investors in capital markets. And since Regulation A+ became effective in the US in 2015, any investor, worldwide, and regardless of net worth can invest in private companies. This is a major change in US securities law, and it means that anyone can invest, if they choose to do so, in a Reg A+ offering, after it has been Qualified by the SEC. Before Reg A+, only wealthy, Accredited investors were allowed to invest in private companies.
Funds and Platforms Focused on Gender and Impact that Anyone Can Invest in or Donate to:
Here are some easy lifts to start putting your money into gender focused or impact related companies and programs.
- CNote – A new way to invest that supports Main-Street America, funding small business loans, affordable housing, and community development in low-income areas. CNOTE is open to all investors, Main Street and Accredited. mycnote.com
- Ellevest – An online investing platform for women created by women. ellevest.com
- Boston Impact Initiative – The Boston Impact Initiative Fund offers an investment opportunity for individuals, institutions and foundations that care about our community’s wealth divide to invest in enterprises that restore the productive capacity of communities of color in Eastern Massachusetts. Loans and Charitable Contributions. https://bostonimpact.org/invest/
- RSF Women’s Capital Collaborative – The Women’s Capital Collaborative is a philanthropic initiative that partners with women entrepreneurs to provide them with crucial growth capital when they need it most. The Collaborative uses an integrated capital approach to fund women-led social enterprises that are supporting and empowering women and girls. More than 50% of their funding supports women of color. Charitable Contribution. https://rsfsocialfinance.org/give/give-to-rsf-projects/capital-collaborative/
Women and Non-Binary Femme Focused Angel Investing Groups:
If you are a high net worth (a.k.a. accredited investor), the following are some some women and non-binary femme focused angel groups that focus on investing, educating and networking. Remember, investing really is a team sport.
- Portfolia – Members select a fund in their area of interest. Their Venture Partners review hundreds of companies from across the world, selecting their top 10 investments for the fund. The investing process is engaging and educational, letting you be as involved as fits into your schedule. Accredited Investors. https://www.portfolia.co/
- Next Wave Impact –Next Wave Impact Fund is working to increase diversity, inclusion, and impact in early-stage investing and our entrepreneurial ecosystem through their innovative learning-by-doing progressive fund model. Their global fund has 99 women investors, 25 of them women of color, which is led by an experienced investment committee of ten women. Accredited Investors. https://nextwaveimpact.com/
- Pipeline Angels – Pipeline Angels is changing the face of angel investing and creating capital for women and non-binary femme social entrepreneurs. Their members serve as the friends and family round for entrepreneurs who may not already have support at that critical stage. Accredited Investors. http://pipelineangels.com/
- Golden Seeds – Golden Seeds’ angel network is one of the largest in the nation, with over 300 members and eight chapters – including Boston. Their membership consists of women and men dedicated to evaluating, funding and helping companies with at least one woman in a management role. Accredited Investors. https://goldenseeds.com/angel-network/golden-seeds-angel-network/
- Plum Alley Investments – Plum Alley Investments is a private membership platform that gives individuals, families and institutions the opportunity to invest in a new way. They offer members access to invest in the most promising women entrepreneurs and gender diverse teams driving ideas and developing new technologies that can change the world. https://plumalley.co/
- Impact NH Fund – Their goals are to assist women led companies with funding needs, and to train more women in NH and surrounding states to participate actively in Angel investing. http://impactnhf.com/
Angel Investing Training Opportunities:
Not ready to go back to school, but looking for a boot camp opportunity to learn about angel investing? Try these options.
- Angel Capital Association Angel University – https://events.angelcapitalassociation.org/2020summit/ACAAngelUniversity
- Pipeline Angels Investing Bootcamp – http://pipelineangels.com/angel-investing-bootcamp/
- Female Funders Angel Academy – https://femalefunders.com/angel-academy/what-is-angel-academy/
Investing Local Opportunities in Vermont, New England & Beyond:
How about supporting your local communities and businesses? Or diversity initiatives in your state? Here are some easy ways to start – with any amount – investing local.
- Milk Money Vermont – for any Vermonter regardless of income. Debt and Equity. New campaign coming soon! milkmoneyvt.com.
- Vermont Community Foundation –There are a variety of ways to work with the VCF, including donor advised funds, supporting organizations, etc. In addition to providing grants, the VCF invests up to 5% of its investment directly in businesses in Vermont that are in support of their mission. Charitable Contribution. https://www.vermontcf.org/DonorsFundholders/ProductsServices.aspx
- Vermont Women’s Fund – The Vermont Women’s Fund is committed to supporting the advancement, self-sufficiency, and economic and social equality of Vermont women and girls. Charitable contribution. vermontwomensfund.org
- Change the Story – Change The Story (CTS) is a multi-year initiative to align philanthropy, policy and program to fast-track women’s economic well-being in Vermont. Their work is fueled by three core partners – the Vermont Women’s Fund, Vermont Commission on Women and Vermont Works for Women. CTS launched in 2015 with a project to collect baseline data related to women’s work, wages, business ownership, and in civic, political, education, and corporate leadership roles. Charitable Contribution. http://changethestoryvt.org/
- Vermont Community Loan Fund –The Vermont Community Loan Fund is a mission-driven, community-focused alternative lender. They provide loans and other resources to local businesses, community organizations & nonprofits, early care & learning providers and developers of affordable housing who don’t qualify for a loan from a traditional lender. For as little as $250, Vermonters you can lend (or donate) to the VCLF funds to do their work. Debt and Charitable Contributions. http://www.investinvermont.org/invest/products-rates-and-terms.html
- RSF Social Finance – RSF offers investment opportunities for anyone interested in matching their investment dollars with social enterprises tackling the planet’s most pressing issues. While based in California, RSF provides loans to social enterprises across 49 states, including Vermont. They offer the opportunity to invest in a Social Investment Fund, Food System Fund and Regenerative Economy Fund. For as little as $1,000, you can earn a financial return and know that your money is also helping to create positive social and ecological change. For both Main Street and Accredited Investors. https://rsfsocialfinance.org/invest/investing-overview/
- Clean Yield Asset Management – An asset (wealth) management firm that builds custom portfolios for clients which channel investment dollars toward developing a more just and environmentally sustainable economy. Accredited Investors. cleanyield.com
- Veris Wealth Partners – An asset (wealth) management firm for individuals, families and foundations seeking market performance and social gain. Accredited Investors. veriswp.com.
- Banking Local with Vermont State Employees Credit Union, Opportunities Credit Union, etc. For a full list of local Vermont Banks & Credit Unions, visit:
- Shopping Local – Food coops, downtown independent retailers, etc. https://vitalcommunities.org/localfirstalliance/keeping-your-dollars-multiplying-in-the-uv/
Impact Investing Resources, Tools and Education:
Want to learn more? There are so many resources to help you align your money with your values. Here’s just a few!
- Impact Investing Glossary – From CNote – https://www.mycnote.com/blog/impact-investing-terms/
- Investopedia – Provides a glossary of investing terms and education. https://www.investopedia.com/
- A Resource Guide for Women Angel Investors – https://medium.com/@joshuahenderson/a-resource-guide-for-women-angel-investors-f5b8c6486b5b
- Northern New England Women Investors Network website – A great set of resources (you have to scroll) including videos, educational materials and links. nnewin.org.
- Milk Money Investing Resource Website – https://www.milkmoneyinvesting.com/
- Invest for Better – a resource to help women mobilize their money for good. https://investforbetter.org/
- Money Quotient – Non-profit organization founded on the belief that a holistic and multi-disciplinary approach to financial education and planning will engage individuals and inspire them to maximize their resources and live purposeful lives. https://www.moneyquotient.org/
- RSF Integrated Capital Institute – This program is offered annually to people who are interested in learning how to be financial activists. https://rsfsocialfinance.org/integrated-capital-institute-2/
- Definition of Integrated Capital – https://rsfsocialfinance.org/our-story/how-we-work/integrated-capital/
- As You Sow – A shareholder advocacy organization, they provide links to tools to help you identify what you own. Last year they released a free online tool to show investors how well their funds rank in terms of gender equity. https://www.asyousow.org/invest-your-values
- YourSRI – YourSRI useful way to assess a company’s commitment to ESG (Environmental, Social & Governance) principles along with its exposure to controversies that can endanger its standing (such as questionable labor practices or potential health risks of its products). You can also track a company’s carbon footprint. https://yoursri.com/
- Amplifying your Philanthropy through Impact Investing – A Workbook for Getting Started – Aimed at helping the philanthropist who is a newbie impact investor develop plans for both learning and action, the workbook guides users through 6 questions to help identify possible ways to use investing (personal, retirement, foundation, or donor-advised fund capital) to increase their impact on the people, places, and issues they care about. https://investforbetter.org/amplifying-your-philanthropy-through-impact-investing/
What We’re Reading and Listening to:
And, if you want to dig deeper, here’s what we’re reading, listening to and talking about.
- The Clean Money Revolution – A book by Joel Solomon. “$50 trillion will change hands from Boomers to Millennials in North America alone by 2050. It will remake the world. We are ancestors of the future. We must know what our money does to people and places, then take actions to align our dollars with our values.” joelsolomon.com
- An Inspiring Story of What to Do with Extra Wealth: Carol Newell and Joel Solomon’s Story: https://consciouscompanymedia.com/the-new-economy/an-inspiring-story-of-what-to-do-with-extra-wealth/
- How Women Are Changing the Game for Women Entrepreneurs, Geri Stengel. https://www.forbes.com/sites/geristengel/2018/11/14/how-women-are-changing-the-game-for-women-entrepreneurs/#3369ea2c60b8
- Women and the Future of Investing – Mellody Hobson, Over the next two generations, women are projected to receive 70 percent of inherited wealth in the S. https://greenmoney.com/women-2/
- Enough Leaning In. Let’s Tell Men to Lean Out https://www.nytimes.com/2019/10/10/opinion/sunday/feminism-lean-in.html?smid=nytcore-ios-share
- Deb Nelson’s Transforming Your Relationship to Money- Interconnectedness is the New Currency. https://livingwellawake.com/2019/10/22/transforming-our-relationship-to-money-generosity-and-interconnectedness-is-the-new-currency-with-deb-nelson/
- How do-good DIY investors can bring ESG into their stock portfolios. https://www.marketwatch.com/story/how-do-good-diy-investors-can-bring-esg-into-their-stock-portfolios-2019-01-02
- Sallie Calhoun’s Speech – Sallie Calhoun delivered one of the 39th Annual E. F. Schumacher Lectures. Sallie Calhoun owns and manages Paicines Ranch, a 7600-acre ranch in central California. She is also an impact investor, activist, and philanthropic funder in regenerative agriculture. Her work focuses on improving the health of agricultural soils, and sequestering carbon in the soil to mitigate climate change. https://www.youtube.com/watch?v=nLaPTey7IeU&feature=youtu.be
- Women “are not good with numbers.” – Kathleen Burns-Kingsbury’s Breaking Money Silence’s podcast with Stacy Francis, Founder of Savvy Ladies, about this myth and how her grandmother paid a high price for not being financially literate. To honor her grandmother’s memory, Stacy founded Savvy Ladies to empower women to take control of their finances and their lives. https://www.kbkwealthconnection.com/women-and-money/women-are-not-good-with-numbers/