Two women investors based in Silicon Valley are teaming up to raise a new $30 million fund to channel seed-stage money into cutting-edge hardware companies, many with women founders.
Jennifer Gill Roberts of investment firm Grit Labs and Kelly Coyne of go-to-market strategy firm Pitch also announced Tuesday that they are merging their two companies under the name Grit Labs. This week they begin a fundraising period likely to last 6 to 18 months, though they expect to make investments during the period.
Roberts is an engineer with more than 20 years of investing experience, while Coyne made her career at early-stage hardware companies and as a startup strategist. Their combined expertise — and mutual passion — they say, positions them well to work with startup hardware companies helmed by hardcore techies and scientists who need and want business guidance.
Grit Labs already has a portfolio of seven companies, six of which have at least one female founder. Among them is Moxxly, a female-founded maker of a smart breast pump, that was acquired in June by the maker of Medela pumps. It has also invested in female-founded LumosTech, which expects to launch its light-therapy eye mask for people with sleep disorders in October.
By raising outside money, Roberts and Coyne aim to expand their tech industry reach and influence. The Grit Labs fund will primarily invest in robotics firms whose inventions are powered by artificial intelligence (AI), a technology realm that they and many other industry watchers believe will lead to breakthroughs, disruptions and future wealth on the scale of the internet.
Guarding Against Sexist Robots
By plucking technical whizzes from the nation’s top labs and helping them build startups, Roberts and Coyne also intend to help shape our AI future — and, specifically, to guard against the rise of sexist robots.
“Right now we are teaching machines how to think and how to behave,” Coyne says. Multiple reports of racist robots are in, so “it’s just a matter of time when we see machine sexism, if we don’t insert more women” engineers and technologists into the development process. “If we just let this new era of tech take off without us, … we are going to wake up in a world we don’t want to be in.” (Indeed, that dawn may have already arrived, if you consider some of today’s sex robots.)
Roberts and Coyne say they won’t be filtering for female founders explicitly, a group that has faced well-publicized problems raising money in the male-dominated technology industry. Rather, their investment thesis focuses on identifying and mentoring technical innovators inside specialized research labs where today’s breakthroughs are being made, such as those at Stanford University.
However, they do “believe that diverse teams do better” and are leveraging close relationships with female engineer hubs to uncover talent, including Stanford’s Women in Data Science Conference and a networking group called Women in Hardware that hosts events — including the one where Roberts and Coyne first met.
It was Stanford that brought Grit Labs and LumosTech together. Vanessa Burns, a systems biologist and bioengineer, and Biquan Luo, an expert in personalized medicine and treatment strategies, participated in a Stanford incubator program called StartX in the spring of 2016 — and Roberts was their mentor.
Supporting Technical Female Founders
Burns and Luo, who met in an entrepreneurship class, were looking to produce a consumer product using a Stanford professor’s invention: a patented light-therapy technology able to shift circadian rhythms and, thus, help the sleep-deprived get some rest and the jet-lagged recover more quickly. They have licensed the technology exclusively and are using it in a sleep mask that will cost $175. (It is not yet available but can be reserved online.)
In StartX, Roberts helped the two women with their go-to-market strategy and business plan — “all those parts that are very difficult for scientists to think about,” Burns says. In July 2016, Roberts became an angel investor.
“There is kind of a sisterhood aspect,” Burns concedes. But most importantly, Roberts and Coyne “are incredible advisers. And as an early-stage company, it’s really great to have good advice from people who have done this before.”
“They really dive in very deeply to support their founders,” she says, digging into everything from financials and product development to market strategy and branding. “They are not worried about getting their hands dirty.”
Roberts and Coyne says they are well aware of the proven impact that early women investors can have on the success of women founders. “Women are playing a key role in the lab, so they are going to come to us,” Roberts says. “Being women in venture [investing] able to fund them and mentor is going to make a difference.”
As active investors, Roberts and Coyne say they specialize in guiding technical founding teams through thorny and important business decisions as they move from product prototype to launch. Theirs is a “conviction-based portfolio,” meaning they fund only a small number of early-stage companies and dedicate a considerable amount of time to leading the investment, serving on the board, coaching entrepreneurs as they make key product and hiring decisions, and shepherding them through to Series A venture rounds.
What they consider to be their sweet spot — seed-stage hardware companies — is an investment area that has flourished in recent years. However, that success led many funds in the space to expand, raise larger funds, chase bigger deals and move upstream into Series A rounds, they say, leaving a void at the seed-stage level. Roberts and Coyne aim to fill that void.
“Our timing could not be better,” Coyne says. “It’s no secret that the venture community is hungry to see some women-led funds.” And “artificial intelligence is still so fresh and so new that we can really make a difference now.”