Each month, we highlight individuals who are driving progress towards women’s economic empowerment within our Working Group Leader Community. Meet Madelaine Czufin, the Founder & Lead of the Capital Parity Project , as we discuss her journey and goals to take on the gaps with gender parity in funding and recognition for underrepresented entrepreneurs and investors.
Let’s start with some background into your journey into the Venture Capital (VC) ecosystem and the focus on female founders.
The start to my career in VC was when I pivoted from working at Barclays to Greycroft , a VC firm in New York. I completely drank the VC Kool-Aid, I loved the energy of backing the incredible new ventures of founders, with companies that could update and change markets, shift mindsets, and even create new industries.
I wanted the opportunity to work more closely with founders from the offset as they scaled their businesses, and particularly focusing on supporting female founders. The founder of The Vinetta Project is based in LA and there wasn't a New York chapter, so I launched the NY chapter and built out that community and programming. We run many different events including pitch showcases, curated dinners, bootcamps, and a mentorship program all with the goal of supporting female founders growing and scaling their businesses and access capital resources. I have loved connecting with these founders, hearing their stories and inspiration for starting their companies along with the hardships and tribulations as a founder, and specifically a female founder. There is an incredible ecosystem of founders in New York but also still so much work to be done for more parity in the startup ecosystem.
Through programming and network expansion I hoped to support these women make better decisions for their businesses and connect with potential partners or investors for future growth. Whether it was a discussion on strategy for scaling a business to profitability without taking outside capital to helping a founder build out their pitch deck, I loved every minute of it!
I recently transitioned to the board of Vinetta to join the team at First Republic Bank, focusing on supporting founders, emerging managers, and VCs. Candidly, I didn’t envision myself going back to work at a bank as I loved the fast paced environment of venture with so much opportunity for improvement in the space. However, I realized this was a platform I could continue my work but on a much larger scale.
So, this is the next stage in my journey, same mission of supporting founders and investors as they grow their businesses to make a better future for our communities.
Taking a step away from your professional background, tell us a bit about what led you to starting the Capital Parity Project at SheSyndicate.
It wasn’t one particular aha moment to understanding the importance of supporting underrepresented founders and investors, but a culmination of experiences that emphasized the importance of pushing the boundaries on how we think, speak, and act on the framework to distribute capital. What I mean by this is that the framework to supporting founders is broken in many ways and needs to be restructured. There are many facets of this, but the area I’ve chosen to focus on through the Capital Parity Project is the way capital is distributed and allocated to funders and founders.
To not beat around the bush, the face of VC has looked very similar for many years, which means those who invest the capital often see many similarities in their background and profile to those they invest in. It is tricky to just pull the rug out from under VC and expect it to change overnight. But the continued statistics around underrepresented founders continues to be disappointing and doesn’t align with the innovative and forward-thinking ethos of the VC industry. If the industry is really going to move forward, it needs to take a moment to look back at the problems that have perpetuated to create the situation we are in today, with few people of color, women, LGBTQ individuals in decision making seats at VCs or in C-suite/Founder roles at venture-backed companies.
Do I expect the Capital Parity Project to solve all of this…absolutely not! My hope is that it creates one piece of the puzzle to solving this problem so years from now a founder meet with an investor - or an emerging fund manager with a Limited Partner (LP) - and not feel discriminated against because of their background, race, education, gender, sexual orientation, or otherwise. They can secure the meeting simply based on merit and close capital based on the viability of their business.
With this problematic framework in mind, give us some insights into what you are building through the Capital Parity Project to start to solve this problem.
The conversation around bias both conscious and unconscious is the starting point for this project. I am bringing together a group of individuals as a brain trust to begin the conversations to break down the frameworks of the industry to rebuild a better one. This working group will include LPs, VCs, researchers, and academics who impact this industry and share a mindset for progress and change.
We will look at how capital flows between LPs to VCs to founders and where bias can impact this flow. This will begin with the access to meeting with capital providers to how that meeting is structured and finally the way the diligence process and final decision is conducted. The goal of bringing together this group of influencers in this space is to combine the more theoretical conversation in academia with the real-world application with the investor community.
The first phase will be the construction of a foundational framework that LPs and VCs can use to run better processes around managing pipeline, running diligence, and making investment decisions. We will launch with a pilot group of LPs and VCs to trial this framework.
We will continue to iterate and develop the key measures to create an industry standard for these practices that all investors can be measured against. This measurement is a tool to isolate instances and bias and educate around how to diminish these unfair biases to create a more equitable process of investment analysis.
What is the greatest lesson you have learned on your journey as an impact leader?
I think through my experiences working with different nonprofits and impact-focused businesses I have become a hopeful realist. I tend to have a visionary mindset at the beginning and then take a step back and try to carve out realistic goals to start to chip away at that larger goal. In regard to the Capital Parity Project, the lofty goal is around parity in the distribution of capital in the private sector between LPs, Investors, and Founders. It is going to take many years to get there and my goal is through the work of the Capital Parity Project, we are able to get there sooner.