Funding Women, an In-Store Kitchen for Pets, and Helping Startups Fail

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FINANCE

Inc. has created a database to track investors who fund women entrepreneurs: “It’s well known that women CEOs get about three percent of venture capital globally, and that black women CEOs get unimaginably less: 0.2 percent. Gender-diverse teamsmaybe just one woman on a founding team that is otherwise all-maleget just 17 percent of venture capital dollars.

“And as entrepreneurs, women, in general, perform pretty darn well. First Round Capital found that founding teams with at least one woman outperformed all-male teams, when measured by their companies’ gains in valuation, by 63 percent. Boston Consulting Group, looking at companies that had been through the Mass Challenge incubator, found that, at the early stages, for every dollar raised, women generated 78 cents in revenue, versus 31 cents for the men. …

“If women are getting so little funding, but at the same time are at least as capable in entrepreneurship as the guys are, then women entrepreneurs represent an overlooked and potentially lucrative market. Inc. estimates that approximately 57 funds have been started just to invest in women and women-led companies. Collectively, they represent more than $1.5 billion. They all can be found in Inc.’s Fundery, a new, searchable database that enables women to find funds that are actively looking to invest in them, regardless of their location or funding stage.”

THE ECONOMY

Job growth at the smallest businesses has fallen to the lowest levels since 2011 : “‘The smaller the company, the greater the challenge,’ said Mark Zandi, chief economist of Moody’s Analytics. As the labor market gets tighter, he said, ‘their problems are only going to intensify.’ Growth at firms with 20 to 49 employees also has slowed since the job market started to tighten in late 2016, Mr. Zandi said.

Matt Haney, chief executive of Universal Network Solutions Inc., a cybersecurity consultancy in Minneapolis, said he lost about $4.6 million in potential revenue last year because he has managed to hire just two cybersecurity specialists, not the 10 he needs. ‘We call them unicorns,’ said Mr. Haney, who boosted pay in 2017 after experienced workers at his firm realized they earned less than new hires. Now, he is working to provide his employees, who travel frequently, with a better work-life balance.”

STARTUPS

Abigail Edgecliffe-Johnson created The Shut Down as an open-source project to help startups fail properly: “‘Startups are all about embracing failure and reinventing yourself and starting again,’ she says. But when you’re actually in the process of failing, she says, ‘It’s like you’re a leper. Nobody wants to come anywhere near you because they think the failure is contagious.’

“The survey that Edgecliffe-Johnson has posted online for The Shut Down asks people who have been through the process to share some of those details, from whether they had filed for bankruptcy to what they wish they had known. She wants entrepreneurs to spill everything ‘from which forms to file in New York vs. Delaware, to how you sold the company assets.’

“Her goal is to build a single, open source resource that guides anyone who needs to shut down their startup through a customizable checklist. ‘Everybody is struggling with the same stuff,’ she says. ‘So The Shut Down is hopefully kinda gonna be the decelerator as an adjunct to all the accelerators that are out there for startups.’”

Atlanta-based startup Goodr is using crowd-sourced logistics to solve the biggest problem in food-waste recovery: Goodr “provides restaurants, airports, convention centers and other food service operations with a blockchain-based digital platform to track surplus food and a food-waste recovery service. Essentially, Goodr offers insights to help food businesses reduce waste, and then picks up and donates what waste they don’t mitigate.

“The hard part was running the operations behind all of the pickups and deliveries. And it wasn’t just hiring carriers to move the food. [Founder Jasmine] Crowe needed delivery capacity she could flex up and down with delivery volume so that she wasn’t paying for any unused capacity. ‘What we started to do is partner with companies that are already out on the road,’ she said. In December 2018, Goodr began partnering with these outside logistics providers and by April, the company was active in half a dozen cities across the country after two years of Georgia-only operations.” To meet rural food need, “Crowe is developing a partnership with a slightly larger hometown Atlanta business: UPS.”

Amazon is offering to help employees quit their jobs to start delivery businesses: “Amazon says it will cover up to $10,000 in startup costs for employees who are accepted into the program and leave their jobs. The company says it will also pay them three months’ worth of their salary. …

“Overall, more than 200 Amazon delivery businesses have been created since it launched the program last June, said John Felton, Amazon’s vice president of global delivery services. One of them is run Milton Collier, a freight broker who started his business in Atlanta about eight months ago. Since then, it has grown to 120 employees with a fleet of 50 vans that can handle up to 200 delivery stops in a day. It has already been preparing for the one-day shipping switch by hiring more people. ‘We’re ready,’ says Collier.”

At-home testing kit LetsGetChecked, which sells kits for conditions ranging from STDs to Celiac, is part of a wave of up-and-coming services providing a more personalized approach to healthcare: “[CEO Peter Foley says,] ‘We’re undergoing a major shift in the healthcare industry with a greater focus on personalized care and accessibility. Our belief is that everyone should have access to routine screening in the home, along with the clinical support to act on the information as required,’ Foley wrote in an email. … LetsGetChecked is just one of a number of startups meant make medical testing more accessible and convenient by providing a wide range of wellness and health tests directly to consumers.”

RETAIL

Hoping to appeal to pet parents, Petco has opened an in-store pet kitchen: “The new JustFoodForDogs kitchen in [Manhattan’s] Union Square store will be manned by trained chefs preparing veterinarian-designed recipes. Those chefs will keep busy, producing 2,000 pounds of food daily, seven days a week to sell in-store and distribute to other Petco locations. ‘It is a hub-and-spoke model. With JustFoodForDogs kitchen here we supply 50 metro Petco stores with fresh and frozen meals and we will double that by the end of the year,’ Konat explains. Already JustFoodForDogs supplies 1,000 Petco stores nationwide with ready-made food.”

45 Party City stores have shut down because there a global shortage of helium, seriously. “While helium is the second-most-abundant element in the universe, it’s a finite resource on Earth. Only three sources—in Qatar, Texas, and Wyoming—produce 75 percent of the world’s helium, according to Gasworld. The US government’s helium reserves in Texas are being depleted, forcing the Bureau of Land Management to ration its supplies.

“At the same time, market demand is growing. Although helium is most popular for filling balloons, it’s also a versatile nonrenewable gas that’s critical for several medical and research applications, according to Washington University. Helium is also used in many electronic and medical devices, including MRI machines, as well as for chemistry research and aerospace manufacturing.”

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E-COMMERCE

A year after acquiring two technology startups, Nike is using them to increase direct-to-consumer sales: “Nike unveiled Nike Fit, a new scanning technology that uses computer vision and machine learning to fit customers for shoes. The feature will be added to Nike’s mobile app in July, and used in select retail stores in the US. In the Nike app, customers will be prompted to use a smartphone camera to take a scan of their foot. The app then spits out a recommended size range for that customer — information that is stored with that customer’s Nike+ profile, and is used to suggest sizes when a customer shops for shoes online or in-store. …

“The integration of the acquisitions into Nike Direct speak to the brand’s priorities to build its direct-to-consumer sales and rely less on wholesale revenue, in order to have more control over brand positioning, pricing and customer data. Nike has projected that its DTC business will reach $16 billion in sales by the end of fiscal year 2020. Nike Direct did $10.4 billion in sales during fiscal year 2018.”

CELEBRITY ENTREPRENEURS

Whoopi Goldberg can add fashion entrepreneur to her repertoire: “Goldberg’s irreverent, laidback love of quirky sweatshirts, bright color and mismatched sneakers has earned her the praise of fashion magazines and blogs as mainstream trends have turned towards comfort and meme-friendly nonconformity. … ‘For me, the idea has always been to be comfortable,’ she told BoF. … Now Goldberg is capitalizing on the fashion moment by turning her unique sensibility into a size-inclusive contemporary line of comfortable, graphic separates, tunics and dresses. Goldberg’s line will also cater to … shoppers “in the middle” who might not be fashion obsessed…”

Rihanna’s Fenty luxury brand is now under the Moet Hennessey Louis Vuitton umbrella. “The partnership makes Fenty LVMH’s first new in-house brand to debut since 1987—and makes Rihanna the first female partner to launch an LVMH brand. Following in the footsteps of other famous fashionistas like the Kardashian-Jenners, Rihanna’s partnership proves that, in the influencer age, personal brands can become big businesses. … Rihanna, who will be the first woman of color to run an LVMH line, will own 49.99 percent of the company. The LVMH-Fenty collaboration is a collision of old and new: LVMH has called its brands ‘maisons’ since it fabricated clothes for French aristocrats in their homes (‘maisons,’ en français); Rihanna has ‘Thug Life’ tattooed on her knuckles.”

SUSTAINABILITY

The race to find the next sustainable seafood off the coast of California is on: The founder of Sea Forager, Kirk Lombard, says, “the most sustainable seafood to eat live at the bottom of the food chain … Lombard proselytizes fishes like herring, which are plentiful in the San Francisco Bay, but not consumed here as they are in cities like Amsterdam, where the Dutch snack on them like hot dogs. …

“And if urchin is boutique, what does that make seaweed? For Catherine O’Hara, it’s the next big thing. In 2017, she and two other women founded Salt Point Seaweed, harvesting wild seaweed from the Mendocino Coast and selling it to restaurants and directly to consumers. They gather kombu, wakame, and nori—seaweeds that O’Hara thinks pass a tough test: ‘They’ve been around for long enough in mainstream culture that preschoolers are hooked on them.’”

ZACK AND GRANT’S DEAL OF THE DAY

RSRCHXchange, the operator of an online marketplace for research, has been acquired by stock trading network Liquidnet. “The acquisition supports Liquidnet’s evolution as a global investment network and enables it to embed a new level of research and analytics into the global investment process. Liquidnet will now be able to deliver relevant, actionable insights directly to investment teams through the Liquidnet platform.”

TAXES

The “Twitter tax break” hasn’t had the impact on San Francisco many expected: “The late Mayor Ed Lee had bet the tax break, which erased the 1.5 percent payroll tax for companies that moved into certain Mid-Market buildings, would keep tech jobs in the city and help revive seedy Central Market Street. At the time, half the area’s offices and 30 percent of the retail shops were empty, according to city data. Filling vacant buildings with creative tech startups, Lee reasoned, would attract hip, independent retailers like Huckleberry, finally ushering in the Market Street revival that had eluded San Francisco mayors since the 1970s. …

“These days it would be a stretch to call Central Market Street a ‘grand boulevard.’ Even after billions of dollars of investment has filled vacant office buildings with 10,000 new jobs, revived historic structures and generated 4,000 new housing units, Mid-Market business owners say the street is more problematic than ever and remains marred by crime, drugs, garbage, vacant storefronts and stalled development projects.”

And that’s what’s ahead.

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