"I only met a couple of female investors in Denmark, and one had to invest in a Danish company, because it was government money. She was very helpful and nice. Almost all the other investors, I spoke with in Denmark, were male," says Melanie Aronson is the Founder and CEO of Panion.

Wanted: Money For My Startup

Since moving to Denmark a year ago, I have been curious to know what the fundraising process looked like for local female entrepreneurs. How has the Danish investment ecosystem been working for them? Have they been through notable experiences they wanted to share? Carla Fabbro discusses raising funding in Denmark with Melanie Aronson, CEO of Panion and Petra Kaukua, CEO and Co-founder of GRIM.

Up until now, studies have been pretty clear on the fate of women in entrepreneurship. While women make up for 16% of the total entrepreneurs, only 2% receive funding. On the other hand, 84% of male entrepreneurs get 98% of the funding.

As an expatriate who lived in Sweden and Denmark, I have been told the same thing in both countries: Scandinavia is more advanced than the rest of the world, when it comes to gender equality. Yet, the #metoo movement and various testimonies of harassed female founders might force us to reconsider this principle we often take for granted.

Denmark and Female Founders: It’s Complicated

As a start I should say that while preparing this article, I was looking forward to sharing various stories and perspectives on that matter. However, I quickly realized that one of the first problems in doing so was finding women to interview.

Let’s be honest: female-led startups in Denmark are rare. And I was slowly coming to the same conclusion I’ve been served by investors when trying to excuse themselves from a low diversity portfolio: ‘’Are they hiding?’’. So much so that one of the founders, I chose to interview is based in Malmö. Given that only one bridge separates Copenhagen from Malmö, she’s considered a semi-local. Melanie Aronson is the Founder and CEO of Panion. The other founder, Petra Kaukua, is a Finnish native who studied In Copenhagen and later co-founded GRIM.

How it all started

Melanie Aronson started Panion in 2015. She had arrived in Sweden a year before that, at the height of the immigration influx on a Fullbright scholarship to research integration at Lund University. Quickly, she felt lonely and in need of meeting people and so did the people, she was meeting during her research. At the time, only dating apps were available, but as we all know, making friends is not the primary goal there. After finding that no friend-making app existed focused on common interest, she decided to just build one. Since then, she released an MVP, joined Fast Track Malmö in 2018 and built a team of 3 people.

Petra Kaukua on the other hand, started GRIM with her co-founder, Carolin Schiemer.

Petra Kaukua, CEO and Co-founder of GRIM.

GRIM is the result of a school project, that led them to research and find solutions to tackle food waste. They launched the food box delivery in July 2018 . The two founders have since then been working on their business model and selling the product.

Both Panion and GRIM were looking for a seed investment at the time of this interview.

Beginnings

Apart from their unwavering motivation and passion to challenge the status quo, all of them (Melanie, Petra and Carolin) are non Danish. As a result, when discussing their fundraising experience, it is obvious that networking was a big part of the process. Fundraising in itself is already a tough step. And even tougher for foreign founders who have to spend extra time building their network and getting to know people in the ecosystem.

As Melanie recalls: ”I went to some startup events over 2017. I met some angels, and they were positive about my idea. They gave me some advice telling me who I should talk to. At the beginning everyone told me I had to find a technical co-founder”, Melanie says.

”I had been spending so much time trying to find a co-founder, someone to build a company with – a total stranger. Now looking back I’m glad, I didn’t  continue looking for someone I hadn’t previously worked with, because I had already done that twice, and it didn’t work. Building a startup is like a marriage, and I’m not going to marry someone, I don’t know.”

A learning curve

Petra and Carolin also had to spend some months networking to get to know the ecosystem. They started looking for funding for GRIM in May 2018, before launching their MVP. They quickly realized it was too early. They were told they needed traction before getting any investment in.

”The food industry is very competitive”, explains Petra. ”You need to show traction to prove this is a good business case.”

After that realization, they focused on getting the business up and running for the following summer. Since then, they have been approached by two types of investors.

”People who are passionate about the cause, and people who see food waste as a trendy opportunity. We want to work with investors who are passionate and care about the impact”.

As a first time fundraiser, it is a learning curve for them.

Like Petra explains:

”In the beginning, the questions they asked were like a crash course for us. Even though I was part of startups before, I have never been fundraising.’’

As an advice to other impact-driven startups, she says:

‘’Understanding what different kinds of investors wanted to know and what needed to be ready for them, was a good learning experience. There were questions that popped up that we didn’t think about because we focus on the impact, on changing the system. We know we can create something big. But as investors, they need another kind of proof than our own conviction.”

Gender Equality within the VC industry

When recalling which investors she met, Melanie explains:

”I only met a couple of female investors in Denmark, and one had to invest in a Danish company, because it was government money. She was very helpful and nice. Almost all the other investors, I spoke with in Denmark, were male.”

Denmark feels more male-centered compared to Sweden.

As a general observation from the CEO of Panion:

“Denmark feels more male-centered compared to Sweden, when it comes to the people pitching, and also the investors that I’ve met. I’ve gone to pitch events in Denmark, where its predominantly men pitching. In general it’s always the case that I’m only one of few women, but it feels even more male-dominated in Denmark.”

Subtle differences

The experience has been a bit different for Petra and Carolin.

“The investors we have met are mostly men. But we have also been approached by female investors. We are quite well networked, and the fact that there are not so many female startups in Denmark makes female investors spot us more easily.”

So is it an opportunity to be a female founder in Denmark?

”Yes and No. You can get visibility because there are really a few of us – at least a few visible. In that sense it is an opportunity. But on the other hand, you can feel that it’s a brothers’ club sometimes. We see it with our own eyes. It’s mostly men, and their network is mostly male-dominated, so we can see we are a minority.”

One could argue that having more male investors than female investors might not be a problem. But going back to the statistics we gave earlier, it seems like it could actually be one. I asked Melanie if she had ever felt that she was judged differently as an entrepreneur because she is a woman.

”In a subtle way, yes. No one has told me ‘’You’re a woman so you can’t do that’’, but I felt that there’s been a bit more doubt and extra questions to make sure I really know Tech. You can feel that there’s a sense of digging deep to validate you. But it’s not with everybody.  I’ve also talked to some angels who, when I was explaining Panion, were trying to squash everything I said, challenge it and prove it wrong over and over and over again and that was really frustrating.”

A similar perspective was shared by GRIM co-founder Petra. ”I feel that we have a lot of proving to do in terms of the business case.”

Female investors are rare

When continuing the conversation, I sense a touch of disappointment, when Melanie adds:

”It’s hard to find female investors.”

Do you feel, that as a female founder, you would be better off with a female investor?

”Most of the female investors, I talked to, have responded really positively to my product. And there’s a lot of men that question it. Maybe it’s because, that some of those men would be less likely to admit out loud, that they feel lonely. And Panion is a very emotional product. So when I see investors coming to a pitch event, I always try to meet the female ones. And we talk in a way that’s more empathetic, such as ‘’I’m really glad you’re trying to solve this problem’’. So yes, I do talk to women more. I feel that I have a better chance at convincing them. I have had a very low failure rate, when it comes to keeping in touch with them.”

The Specificities Of The Danish Investment Landscape

When discussing their experience fundraising, we couldn’t avoid talking about the specificities of Denmark.

Born in the U.S., Melanie is used to another mentality when it comes to making bets.

”There’s a big cultural difference with Scandinavia. In the U.S, no one wants to miss out on the next big thing. Whereas in Scandinavia, everyone is very risk averse. And they are willing to miss out in order to not make a wrong investment. In my case, I’ve tried to tell them, that this could be the Tinder for friends, and that it is their opportunity to invest in the next big thing. It doesn’t work like that here. But that’s the whole point of being an investor, you’re supposed to take risks when you believe in the team behind it. I would like to see more of that U.S. mentality here.”

An observation that is shared by Petra:

”I think there is a lot of risk adversity in Denmark. In our case for example, we really need a lot of proofs to get them onboard. On one hand I understand that, and now we have that traction. But I also feel that in other countries, investors are more ready to jump on impact startups without so much proof and with more passion for  the cause.

Risk and gender

When asked if this risk adversity might be linked to their gender, she replies:

”It might be a combination. We are an impact startup. We are two female founders in a very conservative industry, and we are not from here, so we’ve had some additional proving to do to show that we know what we are doing. There are a lot of startups who can raise money before selling anything, whereas we needed to show that GRIM has customers.”

She continues:

“I think we need to educate investors on the amount of work there is in building an impact startup. It’s harder since we are challenging the status quo.”

Next Steps

Despite the doubts and the hurdles, both startup founders believe in their ability to raise in Denmark. ‘It’s a great place to get start because it is a country where there is a big interest for food and sustainability says Petra.

”But I also think it is interesting for us to look outside because we are building something global and we need investors with a global mindset.”

Melanie shares this opinion. She recognises, that fundraising is an art, that requires practice.

”Investors are subjective. Getting funding is about getting investors to believe in you, making them feel comfortable around you, and showing them, you have a vision, they could be a part of. I’m trying to perfect that craft of engaging with them and nurturing those relationships.”

The next generation of angels

Looking ahead, Melanie already sees opportunities to support other entrepreneurs.

”I’d love to be an angel investor at some point. I’m always thinking about the things that investors ask me, versus the things I would ask the founders I might invest in, and what I would look for.”

When asked what she would prioritize, Panion’s CEO answers:

”The team and the founder more than anything else. I met some people who have great ideas, but are bad at executing. I wish investors cared more about execution. For example, no one has asked me what were my previous experiences in life, or what I’ve had already accomplished. I’ve made films. This is a big accomplishment. It shows I follow through with projects. I’m a detailed-oriented person, and I don’t stop until I finish. When you produce a film, the amount of coordination, fundraising, proof of concept, pitching, is very similar to building a company. Those are the things I wish people looked at. It’s about life accomplishments and personality.”

About the author: After living and establishing strong networks in France, Canada, China and Sweden, I settled in Copenhagen. I invest passion, time and energy in projects, that I believe positively impact communities in the Nordics and Europe. I believe in the untapped potential female entrepreneurs represent, for other women and society.