The power of words, an ‘easy trick’ to see investment potential
Like all great tricks, there’s a great deal of work behind it.
In this case, 5 years at TechCrunch New York, recording, transcribing, coding and analysing the power of words.
Ultimately, how they impact your opportunity to see the investment potential.
One reason diverse led businesses are 4x less likely to be invested in, lies in the framing of questions they are being asked. Flip this the other way, there are massive returns to be gained through the choice of words.
The trick … it’s in the solution by Dana Kanze
We all think we are objective, yet our brains are wired not to be.
So how do we more objectively select, and win,
the most profitable investments?
By balanced framing of questions
Dana Kanze, after selling her tech business for $25m, earned a PHD on how questions were phrased by investors, and answered by founders, in the Q&A section of funding pitches. Words from 200 pitch videos, over 5 years, of the annual TechCrunch events in New York.
“Cultural norms of gender, influences bias, in which both investors and entrepreneurs are complicit.”
“Women and men investors ask female entrepreneurs the same questions men do.”
"Investors may unwittingly offer female entrepreneurs fewer opportunities to present themselves in the same beneficial manner as their male counterparts, by framing questions differently, investors elicit less favourable responses from female than male entrepreneurs." Dana Kanze
70% of male founders were asked
Their aspirations, plans for growth and potential,
for making money for investors.
"How do you intend to acquire customers?"
Female founders were asked
Their plans to maintain the status quo or prevent losses,
and avoid losing investors money.
"What does your customer retention look like?"
Female founder responses, impacts investors
'trust' in founder's as 'confident'
mirrored response, focused on
prevention of loss
switched response, focused on
The solution to being more objective
Informed investors can now balance questions of potential for growth, with prevention of loss,
to more effectively evaluate founders potential, and see through to the most profitable investments.
Informed founders can answer prevention questions, with responses focused on the potential opportunites.
Male and Female Entrepreneurs Get Asked Different Questions by VCs — and It Affects How Much Funding They Get