Forerunner Ventures Touts Diversity as the Best Way to Make Investment Decisions

By Laura Lorek
Publisher with Silicon Hills News

In 2010, Kirsten Green founded Forerunner Ventures, an early stage venture capital firm, based in San Francisco.

She had spent her early career as a retail analyst with Banc of America Securities and others and she spent a lot of time studying retailers. She even went to the mall and counted the cars in the parking lot and visited stores to see what merchandise was popular. She also noticed the world was changing with the rise of e-commerce companies like Amazon and the Millennial generation entering the workforce. And she felt there was a lot of opportunities for startups to create innovative retail products and experiences. Her vision was to invest in the next-generation of consumer e-commerce companies focused on delivering a great experience.

“I wanted to invest in companies that were addressing this new consumer, were thinking uniquely about the model for the moment of time we were at and were leveraging technology to do that,” Green said.

Emily Chang, journalist and host of Bloomberg Technology, a daily show, interviewed Green at South by Southwest for a talk titled “Against the Odds: Charting Your Path as a Woman.” Green is one of a handful of female VCs with female leaders making up about 7 percent of the VC industry.

To date, Forerunner Ventures has raised three funds, the last one, in 2016 was for $122 million. The firm has made 104 investments and had 11 exits, according to CrunchBase. Forerunner was an early investor in Warby Parker, Jet.com, Dollar Shave Club, and Bonobos. It recently invested in Austin-based Outdoor Voices, which is an active lifestyle brand that makes technical apparel for recreation. The startup announced on Wednesday that it had raised $34 million in additional venture capital funding.

Chang asked Green if she felt like the VC industry in Silicon Valley might suffer from a backlash stemming from the #metoo movement and fight against sexual harassment.

“Change doesn’t happen overnight,” Green said.

But she is hopeful that people are having discussions around the topic. A need exists for more education especially around things known as “micro-aggressions” that are harder to recognize, Green said. Diversity will rule out in the end because it leads to greater returns for investors, she said.

“More diverse teams, more diverse groups make better decisions,” she said.

Societal norms also must change so that men and women split their work at home and that leads to greater equality in the workplace, Green said. Her husband does 50 percent plus of the housework which makes it easier for her to do her job, she said.

Green fought back on the label of Forerunner Ventures as an all-female venture capital firm. She said she didn’t hire women or men on purpose. She just hired the best person for the job. But Forerunner did eventually hire two men. The diverse staff provides balance in the conversation at the firm, she said.

“It certainly improved the conversation,” she said.

There is a coalition of women in VC working together to provide a support system for other women coming into the industry now, Green said. Austin-based True Wealth Ventures recently closed on its $19 million Venture Capital fund, led by two female entrepreneurs, founding partners Sara Brand and Kerry Rupp.

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