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A new crowdfunding platform dedicated to helping mums who have started up and are growing their businesses has recently launched and is looking for mums to pitch their business ideas.
Mums Mean Business, a European organisation run from Norway and incubated at StartupLab Norway, Scandinavia’s largest incubator programme, says funding can be a major challenge for women running businesses. In addition to its crowdfunding platform it offers women whose pitches are successful free access to professional mentors for a year, which it says aims to create “a network for success”.
The site was founded by businesswoman Babou Olengha-Aaby, who recently moved from the UK where she ran a fashion label to Norway. She shut down the label – although she retains the company name – when she was six months pregnant. “I have always been interested in innovation and female entrepreneurship and the birth of my daughter was the push I needed to get started. I looked at my values and strengths,” she says. “About four months after my daughter was born in May 2012 I had a Eureka moment. I had been working while my daughter was sleeping, staying up to 4am due to the superhormones that kicked in after her birth. Those soon wore out so I had to be more efficient. I developed a new respect for women who care for a child while they are growing a business. I felt inspired. Then the idea for Mums Mean Business came to me.”
Funding is clearly an issue for mums in business. Babou states: “It is no secret that investors and angels are often reluctant to invest in female-owned enterprises with only 20.3% of European investors and a 1/3 of investors globally choosing to fund female-owned businesses. The alternatives to finance for female entrepreneurs are few and far between. In contrast Global Entrepreneurship Monitor figures show that in 2010 alone, 187 million women worldwide started and owned their own business, with mothers accounting for the majority. These figures suggest there is a great potential and obvious need for a crowdfunding platform such as ours which is dedicated to providing an alternative and democratic source of funding to entrepreneurial mothers who are often bypassed by traditional lending sources.”
The crowdfunding platform uses a rewards-based model. This means members of the public can back projects of their choice by pledging a financial investment in return for a selection of rewards. Investors only have to pay if the business meets its funding target within the timeframe it selects – 30, 60 or 90 days. The platform is open to mums running businesses in EU member states, Switzerland and Norway.
The minimum funding target to start a pitch on the site is 5,000 euros. Mums Mean Business takes 10% from those who are successful in meeting their target since they have provided support services and taken a gamble on the business.
Babou says women can be disadvantaged when bidding for angel investment because they tend to be “more humble” than men who tend to “overpromise”. “Venture capitalists know that men exaggerate, but it is attractive. Crowdfunding is perfect for women as it is how they communicate. They are social media queens. It’s a perfect marriage,” she states.
Businesswomen send in their applications to be on the site and they are reviewed by Mums Mean Business. If the pitch is deemed ready, they can go ahead and put it on the site. They are given access to good quality video producers for their campaign at a special discounted rate and they only have to pay after the campaign has run. They get a year’s free access to a professional mentor and free intellectual property protection advice for a year. If they are not successful, the site gives constructive feedback.
Funding is not the only challenge for mums, which is why the mentors can help. “I wish I could have had one,” says Babou. “I am sure that would have prevented 99% of my mistakes. I had to learn as I went along.” She says some of her mistakes included “being a control freak”, although she adds that it is important for business owners to understand all aspects of the business.
She is keen to show that “mumpreneurs” are not just people “selling cookies on eBay”. “I meet exceptionally talented women every day, but no-one gets to hear about them,” she says. “I want to change people’s perceptions of mumpreneurs through showcasing a variety of businesses.”
The first business was launched earlier this month and in just three days raise 3,000 Euros. That was just the start of its month-long campaign. Babou, who works with a range of mumpreneur organisations, mentions one business which is a social enterprise in Norway. It is run by a mother who noticed that apples from people’s gardens were going to waste. Working with people with disabilities the business harvests the apples and makes award-winning juice out of them. Babou says she is interested in a broad range of businesses. “Value creation is not just about big business. There may be a gap in the market in a small village for a bakery. It might add enormous value to the community. We are open to all these ideas.”