The Rise of the Mommy Investor
Many of you have probably considered creating your own business or finding a job that allows you to work from home. As your children have aged, maybe you have found more free time on your hands, or perhaps there are financial pressures, which have made extra income a necessity. In last 10 years moms have been incredibly successful at bridging the mom/professional gap. In fact, some of the most successful digital blogs, publications, and startups, have all been created by stay-at-home moms.
But where do we go from here? What other opportunities are available for the aspiring professional mom with diapers in one hand, and a contract in the other?
Say hello to “The Mommy Investor”. In my experience as a private equity analyst, mother of 3, and now entrepreneur, I’ve noticed a huge opportunity for moms to work in the high stakes, high payoff world of startup investing. Rather than resorting to traditional at-home employment or entrepreneurship, Moms now have an opportunity to begin leveraging their own money and their marketplace knowledge to make money with their minds, instead of their sweat.
This type of investing (dubbed “Angel Investing”) is where individuals provide funding and advice to companies that are just getting starting. These companies will typically have a business plan, and perhaps a prototype, but need money to build out the product, hire people, etc. Angel investing is more risky than other investments (no guarantees of success), but can also provide huge returns of 10x-100x on the investment. For example, we all think of Google as the multi-billion dollar success story we see today. Even their cofounders though started out of a garage and needed initial angel investment to get the company started. A $50,000 angel investment at their early stage resulted in billions of dollars of wealth.
So why are moms so perfect for this field?
Not only do the daily responsibilities of motherhood require skills such as budget management, operations and planning make them perfect for scrutinizing business plans and balance sheets, there isn’t a single demographic on the market that better understands consumerism. That’s a huge advantage in determining winning and losing companies. That makes moms inherently prepared with the skills to be fantastic early and late-stage investors.
In addition to providing vital insights into consumer trends, the “Mommy Investor” often has professional skills developed over a lengthy corporate career, which can be quite useful in the early start-up environment. Many stay-at-home moms are former professionals like myself who have extensive experience in Corporate America, who’ve run successful businesses, and now those skills lie dormant. By acting as angel investors they can provide valuable business advice based on their hard-won workplace experience to assist small start-ups, and yet still remain full-time active moms.
It’s a big hill to climb for women to assert themselves as competent and successful Angels though. Women (and moms even more so) are currently highly underrepresented in this field (See Angel Investing Guru Marty Shilling’s article here). Only 5% of women are involved in startup investing. Although it’s currently dominated by wealthy men, I see a huge change coming for the reasons I stated above. As a testament to these observations, my startup, Belly Ballot, which is a new fun twist on naming your baby, is limiting our new angel funding round to “Moms Only”. Not only are moms are our ideal investor, but we understand how important it is to set an example that will help raise awareness of The Mommy Investor among moms and startups. We need to start somewhere.
Can you see yourself being a qualified startup investor? I’d love to hear your feedback. I’ll be writing a follow up post soon on where one might start if they were indeed interested.
Lacey Moler is the Co-Founder of Belly Ballot (www.bellyballot.com), which makes naming your baby more fun. It is a new social startup that allows parents to choose their favorite names and invite friends and family to vote via Facebook and Twitter. Founded in Winter of 2012, the new social website draws thousands of expecting parents every month who search for the perfect name and share their choices with friends online. Lacey is a mom of 3 and former private equity analyst. Follow her on twitter – @bellyballot
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