Women-led travel startups talk challenges, change, funding

Every year the gender gap in the workplace closes just a little. That's the good news. The bad news is that at the current rate it will probably take hundreds of years for women to fully be on a par with men.

The pandemic has certainly not helped the situation, and a study on the recent spate of layoffs in technology companies reveals women are disproportionately affected .

But a number of organizations and initiatives, both within and outside of travel, continue to raise the profile of women and minorities and the importance of creating a diverse workplace.

Most recently Next Level was unveiled to spur change and bring more diversity to technology through storytelling. The Amsterdam-based platform, which says it wants to "achieve for technology what the Queen's Gambit has for chess" has landed funding of €100,000.

It plans to use various media including streaming and a magazine to promote stories based on "a group of characters navigating all the challenges, setbacks, successes and excitement any technology entrepreneur faces."

The stories will no doubt chime with many travel startups founded by women who have already lived some of those challenges and more.

PhocusWire discusses the difficulties in fundraising, whether the situation is improving and what it will take to move the needle with the founders of AltoVita , Flywallet and Out of Office .

Alejandra Fernandez, co-founder of Flywallet, feels that as a female entrepreneur of color she was at a disadvantage from the beginning as regards fundraising.

"My company bridges travel-tech with Web3, which are both extremely male-dominated industries. So when I became a mom, my confidence took an additional hit. I worried investors would see my family life as a negative and not take me seriously. Even though there's a lot of talk about diversity and inclusion these days, I felt that acknowledging these obstacles would mean I’m making excuses. It's a 'silent struggle' we women go through, and it can be especially tough when you have an immigrant background or past experiences with men that add extra layers of influence to the mix."

It's a similar story for Vivi Cahyadi Himmel, co-founder of AltoVita, who says the startup's "fundraising journey was by no means a romantic one."

"Unfortunately, as humans, we tend to resonate more with those who look or speak or act like us. While it’s important to provide the right support system to female founders via coaching, mentorship and ecosystem, equally, there is still a lot to do in overcoming the lack of gender diversity in venture capital. According to a research finding by Harvard, the percentage of women in venture capital firms has remained around 10% for the past 25 years, lagging behind other highly compensated fields like medicine or law. It’s widely known that only 2% of funding is allocated to female founders."

She adds that the company, which announced $9.5 million in funding in late 2022, "prospected 294 investors and had meaningful meetings with 54."

"Out of those we spoke with, we only met three female partners. Sarah Liu, partner at Fifth Wall, was one of the three female partners we met, and Fifth Wall eventually co-led our Series A with Novum Capital partners. This experience reinforced my and my co-founder Karolina Saviova's commitment to building a diverse and inclusive team that can bring a fresh perspective and innovative ideas to the table."

A further study from Harvard Business Review reveals a further potential snag for female entrepreneurs. It shows that female startup founders who have raised exclusively from female investors find it harder to raise additional rounds.

The study reveals that female founders are seen as competent if funding is raised from male investors, while where investment comes from a female, the success is linked to their gender.

And funding is not the only challenge. Jan Seale, CEO and co-founder of Out of Office , points out that although senior roles in the travel industry are dominated by men, the consumer trend is for women to make the majority of travel decisions.

"I find that the attention to the female experience is largely ignored in most travel companies, and at Out Of Office we are actively working to rectify this. Women make 80% of travel decisions yet we often find ourselves having to sell investors on why we focus on female consumers and are often met with skepticism despite that fact."

The situation is gradually improving and efforts from initiatives such as Next level will help further.

Fernandez sees more of a focus on the gender imbalance in the startup ecosystem, although she believes biases will continue to exist.

"So I believe we have to excel despite these challenges. It's important we learn to use our unique circumstances to our advantage and not try to fit into a standard mold created by men. Building self-confidence and opportunities that empower us to succeed is key. As we break down barriers and open doors, we must also invest in and support the next wave of female entrepreneurs."

Cahyadi Himmel feels that while there's a long way to go, the situation is getting better for women-led startups with "more resources and support available to help them succeed."

She points to research from Beauhurst that reveals that 27% of equity deals in Britain involve businesses founded or co-founded by women, a three percentage point increase on the previous year.

"It’s inspiring to see how organizations such as Angel Academy, All Raise and Female Founders Fun support and fund women-led startups, while larger VC firms have begun prioritizing diversity and inclusion in their investments. These efforts not only reflect the ethical responsibility to promote equality but also recognize the commercial benefits of a diverse portfolio."

Moving the needle

When it comes to really moving the dial, the founders of female-led travel startups also see a lot of work that needs to be done to catch up.

A move from the Financial Conduct Authority to boost diversity and inclusion by working toward having women and minorities represent 40% of board positions at listed companies and report on their progress is praiseworthy, but it's just one step forward.

Seale says: "Representation matters, and it’s important to see women and people that look like me at the top of all industries. It’s unfortunate that we have to mandate that, but it’s a step in the right direction. Less than 2% of all venture capital dollars go to women, still, so we can start by giving more women the funding they need for a chance to build compelling businesses."

Fernandez agrees and says that little things such as "showing respect and giving encouragement" can go a long way.

She says: "Companies should train their employees to recognize and overcome unconscious biases. For example, if there's only one woman in a group of 10 men, how can the men be aware of potential biases and make sure everyone feels comfortable enough to speak up? We also need to extend family-friendly policies to both parents without judgment or career impact. Another important step is to empower female-led startups. We need more organizations that are dedicated to helping women entrepreneurs get funding."

But Cahyadi Himmel points to research from Deloitte revealing that gender diversity in United Kingdom boardrooms of 30% lags that of France, 43%, Norway, 42%, and Italy, 36%.

She adds: "The UN progress report on its sustainable development goals suggested that it may take close to 300 years to achieve gender equality and the empowerment of all women, and that the world is not on track to achieve
gender equality by 2030. We all have a small part to make this a reality."

Mentors like me

Mentors play a huge role in startup life and success, and it's not different for female-led companies.

Seale says: "We could not have built this company without the mentors in our lives. That ranges from folks who have industry specific knowledge to people who have experience in building companies, raising money, or simply navigating the travel space.  You have to have people, and namely women, to look at as people who have been through it before, can help you avoid the missteps they’ve made in the past and can offer an ear when you need to talk through the challenges of being a woman building a business. That empathetic ear is invaluable. I pride myself on the relationships I’ve built with the mentors in my life – most of them are now investors and supporters in our business, and we wouldn’t have gotten this far without their support."

She adds that in turn she feels it's her role to "bring others along on this journey by offering support, guidance and my network to help afford them the opportunities I've been fortunate to have."

Fernandez agrees that support from someone who has been in your shoes and experienced the same challenges is invaluable.

"When we see other women succeed as their bold, authentic, and vulnerable selves, it gives us the confidence that we can do it too."

Studies show that having a diverse team not only allows more voices and wider views to be heard, it also helps with company retention with people feeling more comfortable when they see people like them.

For these reasons, many travel startups are trying to create a diverse team from the beginning.

Seale says: "This has been critical to me. As a Black woman who has often been the only other Black woman around the leadership and executive tables I’ve sat on, I understand the importance of diversity firsthand. One of the core values at our company is 'Champion diversity of culture, thoughts and representation.' It is imperative that we take the time to find unique and diverse candidates to help build our companies."