It’s a man’s world in venture funding

A woman seeking VCs for smart breast pump startup confronts man-sized wall

BEFORE her first meetings with venture capitalists, Janica Alvarez thought she could have a professional discussion about breasts.

Alvarez was trying to raise money for her startup Naya Health Inc, which makes a smart breast pump. Naya has secured approval from the US Food and Drug Administration, achieving that milestone much earlier than most young companies.

But the conversations weren’t what she expected.

Investors wanted to know how she’d be able to run a startup while also raising her children. Another commented on her body and asked how a mother of three stays in such good shape. Others said they were too grossed out to touch her product or pleaded ignorance about how a breast pump works.

“Investors would say, ‘Let me go talk to my sister; let me go talk to my wife’,” Alvarez said.

She and her husband, Jeffrey Alvarez, managed to raise US$6.5mil from investors after starting the business together in 2013. But they’ve recently hit a wall. With few VCs willing to fund the product, they’re turning to Kickstarter in the hopes of keeping their company running. The campaign, with an initial goal of US$100,000, started last Thursday.

“If VCs don’t want this, then we know parents and mothers do,” Alvarez said.

The US venture capital industry is 93% male and facing heightened scrutiny for the sometimes-fraught relations with Silicon Valley’s few female entrepreneurs. Alvarez’s experience illustrates how getting venture funding can be even harder when your product isn’t one men use.

The breast pump market is dominated by Swiss manufacturer Medela LLC, which got a boost in the US from an Obamacare mandate that insurance companies must cover the cost of pumps for new moms.

Most devices use hard plastic cups and an air suction system. They’re often loud and sometimes painful.

The Naya’s soft suction cup mimics the feel of a baby’s mouth and distributes the suction over a broader area of a woman’s breast.

Alvarez said the Naya delivers 30% more breast milk and is 20% faster than alternatives, thanks to a unique water-based system.

The company is also planning to sell a smart bottle that will be able to track the volume, calorie count and fat content of breast milk and inputs them into an app. Mothers would be able to use the software to monitor how much they’re pumping, how much the baby is eating and how much milk is left in storage.

Customers are asked to pay a serious premium for those features. The company was selling the Naya for US$999 until Thursday, when it lowered the price temporarily to US$649. A typical Medela pump is about US$250.

Naya is now pitching a lower-end model without a rechargeable battery or certain accessories for US$399, though the price will go up by US$100 eventually. The pump is partly covered under certain insurance plans and is free for military servicewomen.

Naya plans to offer rentals in the future for those who can’t afford the upfront cost.

Despite the price, Naya has won favourable coverage from Wired and the New York Times.

There’s a dedicated fan base among mothers who can afford it, like Emilee Stucky, a 29-year-old new mom in Wichita, Kansas, with seven-month-old twin daughters.

“The comfort alone is worth the investment,” said Stucky, who works as a freelance calligrapher. “In a world where pumping is already so inconvenient for women, the Naya breast pump makes it so convenient and so comfortable.”

Like most VCs Alvarez met with, Charles Hudson didn’t know anything about breast pumps. Hudson, a managing partner at Precursor Ventures, said he decided to make