Funding Female Founders: Peanut Launches Microfund StartHER

The newly-launched microfund will offer small investments ranging between $25,000 and $50,000 to early-stage, pre-seed businesses who share a mission to positively impact the society and/or the planet. This focus on early-stage funding is in response to the inherent bias that every startup founder has access to wealthy friends and family who can provide startup capital. This is often referred to as the “friends and family round.” As Peanut CEO Michelle Kennedy has explained, this creates an unfair starting line for many groups of founders. By launching StartHER, Peanut wants to level the playing field.

The launch of StartHER comes at a time where female-founded startups are beginning to recover from the impact of the COVID-19 pandemic. In 2020, the overall funding for these startups decreased 27% as compared to 2019. While this decline in funding is concerning, women have historically been underrepresented in the venture capital space even prior to the pandemic. The reasons for this are systemic. However, some point to the lack of influence women may have on the funding decisions that venture capital firms make. Indeed, only 13% of decision-makers at United States-based venture capital firms are women.

Peanut will not be taking an equity stake in the companies it invests in. Rather than focusing on returns, Peanut’s primary focus is investing in companies that have the potential to make a significant societal and environmental impact. To help advance the companies’ missions, Peanut will ensure that all startups who receive StartHER funds have access to the investment committee members’ networks.

Author: Jennifer Linde, 2021 Summer Student-at-law