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She Owns It: Lessons Learned From a Difficult Succession

July 2, 2013 by Leave a Comment
She Owns It

Portraits of women entrepreneurs.

Susan Parker, Bari Jay.Earl Wilson/The New York Times Susan Parker, Bari Jay.

At the last meeting of the She Owns It business group, we talked about succession planning. This post continues that conversation, beginning with thoughts from Susan Parker, who owns Bari Jay, a family business.

Ms. Parker’s outlook was shaped by the fact that she and her sister inherited the business unexpectedly from their father, who left no business succession plan. Had he created a plan, she said, one of two things might have happened. Either she and her sister would not be running Bari Jay today, or the two of them would have been better prepared had their father made it clear that he wanted them to take charge.

“Did you ever think about not running the company?” asked Alexandra Mayzler, who owns Thinking Caps Group.

“I did,” said Ms. Parker. But, she added, “At the end of the day, I felt like I owed it to my father and his legacy.”

And now, she and her sister also believe they owe it to their children to leave a succession plan. Ms. Parker said they are “over-consumed” with creating one and are now hammering out the details with lawyers and insurance agents. They hope to have it finalized in a few months. “We want to do everything our father didn’t,” she said. “I’ve learned from this whole process that it’s so complicated to get what you want.”

Ultimately, Ms. Parker and her sister want their children — each sister has two — to have the opportunity to enter the business if they want to. As of now, the plan provides that if something happens to one sister, her children will own half the company in a trust while the other sister continues to run it. Ms. Parker said that “something” could be a career-ending disability, as well as death — a possibility she realized only after her discussions with professionals. She also noted that the plan will need to be reassessed every five years or so.

Beth Shaw, who owns YogaFit, asked what happens if none of the children wants to enter the business.

Ms. Parker said that will be their choice. For now, she said her children, who are 6 and 8, plan to work for Bari Jay after they retire from careers as professional football players.

“Then you have the complexity of what if all your children don’t get along?” said Deirdre Lord, who owns the Megawatt Hour. “What if one person wants to get out and the other three don’t?”

The succession plan will include buyout options, Ms. Parker said. It will also ensure that neither sister’s spouse can have any part of the business — a provision that could become especially important if one sister dies and her spouse remarries someone who wants to own a piece of Bari Jay.

“There’s just so much to think about,” Ms. Parker said.

Jessica Johnson inherited Johnson Security Bureau, which both her grandmother and her father had run. Neither left a succession plan, contributing to some unresolved challenges that Ms. Johnson cannot discuss. However, she said, “It’s one thing to have a succession plan,” and another to follow it. Questions of interpretation may also arise, she said. “You can have the best intentions and put that on paper, and then how do you make sure it comes to fruition?” she asked. “That’s one of the major challenges of succession planning.”

For Ms. Shaw, the decision to create a succession plan, working with a lawyer and a financial planner, was inspired by her frequent international business travel. She said she realized she could “fall off a mountain or something” in India. Then what? For Ms. Shaw, it’s important that her business continue long after she’s gone.

“I did a plan where I’m leaving the business predominantly to some of the people who’ve worked with the company for a very long time,” she said. She’s told them, “If something happens to me, you guys are going to be running this thing.”

Ms. Parker said it would have been helpful to know that her father planned to leave the company to her and her sister.

Ms. Johnson said her grandmother took a similarly vague approach to spelling out her wishes. “She would say, ‘I’m going to the clods of dirt one day,’ and I’d say ‘What happens then?’” She said her grandmother would reply that she didn’t want to “talk about that now.”

Ms. Shaw said you have to be pragmatic: “We’re all going to be dead, so I need a plan.”

You can follow Adriana Gardella on Twitter.

Article source: http://boss.blogs.nytimes.com/2013/07/02/lessons-learned-from-a-difficult-succession/?partner=rss&emc=rss

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You’re the Boss Blog: Dealing With a Laid-Back Software Vendor

April 15, 2013 by Leave a Comment
She Owns It

Portraits of women entrepreneurs.

In a post published last month, Susan Parker, a member of the She Owns It business group, shared some of her frustrations about working with a software vendor that didn’t seem to share her sense of urgency. Her company, Bari Jay, has been in the process of switching to new software for more than a year. During a recent conversation, Ms. Parker reviewed the status of the project, which was supposed to take three months, and she responded to reader comments on the earlier post.

No, Bari Jay has still not made the changeover. But Ms. Parker is cautiously optimistic. “We’re into the home stretch,” she said. Invoicing is the new system’s remaining sticking point, but at least the process of testing the invoicing function has begun — a sign of progress, she said.

She hopes the new software will be up and running by May. To try to ensure that the vendor picks up the pace, she has been holding daily huddles on the subject with her staff. And once or twice a week, during the huddle, Bari Jay calls the vendor to address issues that have arisen among the group. “This eliminates the he-said, she-said,” she explained.

Ms. Parker noted that the well-intentioned advice of some commenters reflected the erroneous impression that Bari Jay was attempting to create a fully customized system. For example, one commenter wrote, “I cannot fathom her business is so complex/unique that she needs completely custom software.” Ms. Parker couldn’t agree more, which is why she chose the software option she did, an off-the-shelf solution that is being partially customized for Bari Jay. “The majority of the system already existed,” she said.

Other suggestions might have been helpful had she followed them a year ago, Ms. Parker said. She noted that given the time that has elapsed, the amount of work already done, and the payments she’s made, Bari Jay is “way past the point” where it would make sense to — as one commenter put it — abandon this “unsuitable spouse at the altar.” As for withholding payments, it’s also too late for that, although Ms. Parker said she has certainly learned from that mistake.

She has tried issuing hard deadlines and checking references, as some commenters recommended. But, she said, the deadlines have so far proven ineffective. And though Ms. Parker grilled past references, she noted, “No one’s giving a reference unless it’s good.”

We’ll follow up to see whether Bari Jay’s software vendor delivers by May, as Ms. Parker now hopes.

You can follow Adriana Gardella on Twitter.

Article source: http://boss.blogs.nytimes.com/2013/04/15/dealing-with-a-laid-back-software-vendor/?partner=rss&emc=rss

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You’re the Boss Blog: Releasing New Web Sites and Trying to Manage S.E.O.

April 1, 2013 by Leave a Comment

She Owns It

Portraits of women entrepreneurs.

In the last few months She Owns It business group members Beth Shaw, who owns YogaFit, and Alexandra Mayzler, who owns Thinking Caps Group, have overseen the redesign of their company Web sites.

When we last discussed Ms. Shaw’s proposed new site in depth, many readers were skeptical that her Web developer would meet her Jan. 1 deadline to go live. The developer came close — the new site was up Jan. 3 — and Ms. Shaw said she was “about 90 percent satisfied.” There was a problem with the search function, but it was quickly addressed, she said.

The redesign did not include new Web site copy. Most of the old text was merely “poured over,” Ms. Shaw said. “So, I will have the painstaking task, once I get freedom, to go probably page-by-page and rewrite a lot of stuff.”

Ms. Mayzler said she found the new look of YogaFit’s site “soothing.”

“I’m really happy with it,” Ms. Shaw said. “I look at it and go, ‘Wow, why didn’t I do this three years ago?’”

For Ms. Shaw, the next step is search engine optimization. YogaFit’s site has had no S.E.O. whatsoever for at least a year, she said, adding that this may be why business is down. Ms. Shaw suspects that when YogaFit’s Web site was updated about a year and a half ago, all of its S.E.O. was wiped out. “Now I’m much more on top of these little things,” she said.

She just hired a firm to handle S.E.O. The first phase of the project will involve cleaning up the code on each of YogaFit’s Web pages for a charge of about $2,500. After that, ongoing S.E.O. will cost $1,500 a month. Ms. Shaw found this price reasonable after talking to another firm that wanted to charge between $2,500 and $5,000 a month. When she asked the firm how long it would take to see results, she said she was told she might not see any.

“It’s not a guaranteed science,” she acknowledged. Still, the answer made her leery. She said the firm she hired sounded “a little bit more optimistic,” and told her that, within three months, she should see more traffic and click-throughs on her site.

Group member Deirdre Lord, who owns the Megawatt Hour, said she’s skeptical of S.E.O. firms and admitted she’s done “zilch” so far to optimize her site. “I feel like you should be able to see major impacts in the first couple of months,” she said, “but these firms, I don’t even know what these firms do.”

“I get stats every day on how many people went to our Web site, so I’ll be able to tell — and I can cancel the contract at any time,” Ms. Shaw said.

Ms. Mayzler also has a new Web site that went live last month. The update was necessary to reflect added offices and programs, refresh the site’s look, and improve functionality. For example, new pages could not be added to the old site.  The new site also offers more information about Thinking Caps’ various programs, but presents it in a streamlined manner. It adds a personal letter from Ms. Mayzler, and photos of actual pairings of students and tutors.  Ms. Mayzler is very happy with the site and said its organization makes it “easier to understand how we do what we do.”

Ms. Shaw asked whether Ms. Mayzler plans to optimize it for search engines.

“I don’t think so,” she replied. She explained that the site really serves as a resource for existing clients. “People don’t generally search for us all that much,” she added.

In addition to getting a new Web site, Ms. Mayzler’s company got a new name, Thinking Caps Group. It was formerly Thinking Caps Tutoring. She said the name change reflects the fact that the company offers broad academic support and not just tutoring, helping students become “independent learners.” She wanted the new site’s URL to match the company name but wanted those who knew the company by its original name to be able to find it. For that reason, she plans to keep the old site up for awhile, and it will re-direct visitors to the new one. “It was painful and slightly inconvenient, but it will just take time,” she said.

What do you think of the new YogaFit and Thinking Caps Group sites?

You can follow Adriana Gardella on Twitter.

Article source: http://boss.blogs.nytimes.com/2013/04/01/releasing-new-web-sites-and-trying-to-manage-s-e-o/?partner=rss&emc=rss

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She Owns It: When Software Vendors Take Their Time

March 6, 2013 by Leave a Comment
She Owns It

Portraits of women entrepreneurs.

Susan Parker: Earl Wilson/The New York Times Susan Parker: “Too late.”

At the last meeting of the She Owns It business group, Susan Parker talked about the frustrating process of switching to new software to run her company, Bari Jay. After more than a year, the project, which was supposed to take three months, is still unfinished — although she hopes the new software will be live within a month. Although she likes the software, with hindsight she says that she would never work with this particular software development company again. But where does that leave her now?

The software company’s co-owner, she said, is “the most laid-back person” — although, she added, “he wasn’t laid back in the sales process.” The co-owner, who is based in the Philadelphia area, meets with Bari Jay at its offices one day every month or two. When he’s there, Ms. Parker said, she observes no sense of urgency. For example, he once took a 30-minute cigarette break before addressing a glitch she had called to his attention. “If he worked for me, he’d be fired by now, but I can’t do anything,” she said.

Beth Shaw, who owns YogaFit, asked whether Ms. Parker thinks the software company co-owner even understands his own system, given that he seemed more focused on sales.

“He knows his system inside and out,” Ms. Parker replied, “and I think he even knows my system pretty well.”

The group considered what, if anything, Ms. Parker could do to address the problem at this late stage.

“Some software implementations have sort of staggered payments, so you don’t make the last payment until it’s live,” said Deirdre Lord, who owns the Megawatt Hour.

“We did that with our Web site,” said Ms. Shaw, who talked about her site in previous posts.

“Too late,” Ms. Parker said. She paid in three installments during the three-month time period that the project was supposed to last. “Then, all of the sudden I was like, maybe I shouldn’t have paid them,” she said.

“Exactly,” Ms. Shaw said.

On the plus side, Ms. Parker said, the software company knows that the monthly payments she began making in November won’t continue indefinitely unless the software goes live — soon. “They’re also hoping to go after more bridesmaid and bridal companies,” she added.

“Referrals,” Ms. Lord said.

“If it’s working for my company, there are like five other companies on my same old software,” she said. The software firm would only have to make minimal modifications going forward if it took on those projects.

“The conventional wisdom is every technology project takes two or three times as long, but yours blows that,” Ms. Lord said. “I’ve heard a lot of people tell the same story with different technologies.”

Ms. Parker said she’s learned a lot from the process but doesn’t plan on switching software again for a very long time — if ever. She said it’s become “embarrassing” to give the same status report every time she attends one of her Entrepreneurs Organization meetings. Yet no one there can think of what she might do differently.

Although she stays on top of the software company, she said she must ultimately rely on them to do what they say they’re going to do.

Any suggestions? How has your business dealt with “laid back” technology vendors?

You can follow Adriana Gardella on Twitter.

Article source: http://boss.blogs.nytimes.com/2013/03/04/when-software-vendors-take-their-time/?partner=rss&emc=rss

Filed Under: Small Business Tagged With: , ,

You’re the Boss Blog: When Software Vendors Take Their Time

March 4, 2013 by Leave a Comment
She Owns It

Portraits of women entrepreneurs.

Susan Parker: Earl Wilson/The New York Times Susan Parker: “Too late.”

At the last meeting of the She Owns It business group, Susan Parker talked about the frustrating process of switching to new software to run her company, Bari Jay. After more than a year, the project, which was supposed to take three months, is still unfinished — although she hopes the new software will be live within a month. Although she likes the software, with hindsight she says that she would never work with this particular software development company again. But where does that leave her now?

The software company’s co-owner, she said, is “the most laid-back person” — although, she added, “he wasn’t laid back in the sales process.” The co-owner, who is based in the Philadelphia area, meets with Bari Jay at its offices one day every month or two. When he’s there, Ms. Parker said, she observes no sense of urgency. For example, he once took a 30-minute cigarette break before addressing a glitch she had called to his attention. “If he worked for me, he’d be fired by now, but I can’t do anything,” she said.

Beth Shaw, who owns YogaFit, asked whether Ms. Parker thinks the software company co-owner even understands his own system, given that he seemed more focused on sales.

“He knows his system inside and out,” Ms. Parker replied, “and I think he even knows my system pretty well.”

The group considered what, if anything, Ms. Parker could do to address the problem at this late stage.

“Some software implementations have sort of staggered payments, so you don’t make the last payment until it’s live,” said Deirdre Lord, who owns the Megawatt Hour.

“We did that with our Web site,” said Ms. Shaw, who talked about her site in previous posts.

“Too late,” Ms. Parker said. She paid in three installments during the three-month time period that the project was supposed to last. “Then, all of the sudden I was like, maybe I shouldn’t have paid them,” she said.

“Exactly,” Ms. Shaw said.

On the plus side, Ms. Parker said, the software company knows that the monthly payments she began making in November won’t continue indefinitely unless the software goes live — soon. “They’re also hoping to go after more bridesmaid and bridal companies,” she added.

“Referrals,” Ms. Lord said.

“If it’s working for my company, there are like five other companies on my same old software,” she said. The software firm would only have to make minimal modifications going forward if it took on those projects.

“The conventional wisdom is every technology project takes two or three times as long, but yours blows that,” Ms. Lord said. “I’ve heard a lot of people tell the same story with different technologies.”

Ms. Parker said she’s learned a lot from the process but doesn’t plan on switching software again for a very long time — if ever. She said it’s become “embarrassing” to give the same status report every time she attends one of her Entrepreneurs Organization meetings. Yet no one there can think of what she might do differently.

Although she stays on top of the software company, she said she must ultimately rely on them to do what they say they’re going to do.

Any suggestions? How has your business dealt with “laid back” technology vendors?

You can follow Adriana Gardella on Twitter.

Article source: http://boss.blogs.nytimes.com/2013/03/04/when-software-vendors-take-their-time/?partner=rss&emc=rss

Filed Under: Small Business Tagged With: , ,

You’re the Boss Blog: More Thoughts on Growing Your Business

January 15, 2013 by Leave a Comment
She Owns It

Portraits of women entrepreneurs.

In previous posts, members of the She Owns It business group discussed last year’s accomplishments and their goals for 2013. This week, a member of the group, Alexandra Mayzler, who owns Thinking Caps Tutoring, adds her perspective and leads the group into another conversation about managing employees.

Looking back at 2012, Ms. Mayzler was most pleased that her company created an infrastructure that she believes will enable it to grow. “When we started talking, my biggest concern was I didn’t want to grow if we didn’t have a system in place,” she said. “Now we have it, so there’s no excuse.” In the last year, she said, she has transferred the information needed to run the company from her head to a handbook complete with flowcharts that explain how to do things — including hiring and firing — the Thinking Caps way.

She is also happy with improvements Thinking Caps made to its tutor training materials that made them more fun and interactive. Updates to the company’s Web site and logo are imminent. Ms. Mayzler said these changes will reflect that “we’ve been around for 10 years and are growing up.”

During a previous meeting, Ms. Mayzler talked about two new Thinking Caps programs: Prepare to Launch, which is geared toward young adults navigating post-college life, and a study skills class (in addition to the individual tutoring already offered). Having the new programs is one thing, she said, but equally important is letting people know about them. Ms. Mayzler plans to accomplish this by partnering with schools or organizations that offer classes for children and teenagers, like a Y.M.C.A. or a Jewish Community Center.

Managing her staff continues to prove challenging for Ms. Mayzler. She feels she is effective in guiding, inspiring, teaching and critiquing tutors. But she is less adept at setting expectations and directing her office staff.

Another group member, Beth Shaw, who owns YogaFit, said she finds herself in a similar position. She feels she is better at managing her company’s yoga trainers than its office staff.

“I also wonder if I’m training people correctly,” Ms. Mayzler said.

“I’ve had issues with always trying to see the potential in people,” said Deirdre Lord, who owns the Megawatt Hour.

Employees who don’t see their own potential worry Jessica Johnson, the owner of Johnson Security Bureau. She said that while she’s in business to make money,  “something greater” keeps her going. “If I can use my business or my position and whatever bit of voice I have to help somebody get closer to what they’re supposed to be doing in life, I feel like that’s part of my job,” she said. But she can’t accomplish that without some help from the employee.

With a little extra effort, she said, some of her company’s guards could position themselves for promotions and higher wages. “If they realize they can do better,” she said, “I can help them do better. But if they can’t see that for themselves, everything I try to do for them is for naught.”

You can follow Adriana Gardella on Twitter.

Article source: http://boss.blogs.nytimes.com/2013/01/15/more-thoughts-on-growing-your-business-and-helping-employees/?partner=rss&emc=rss

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You’re the Boss Blog: YogaFit Decides Its Web Site Needs to Shape Up

November 27, 2012 by Leave a Comment

She Owns It

Portraits of women entrepreneurs.

In previous posts, we focused on the Web site for the Megawatt Hour, an energy-related start-up co-founded by She Owns It business group member Deirdre Lord. This week, we take a look at the Web site for YogaFit, which is owned by Beth Shaw.

YogaFit is on its fifth Web site. The first was introduced in 1998. The current site got a “facelift” in 2011,  Ms. Shaw said. The facelift, which an independent contractor handled for about $3,000, changed the site’s look, including its graphics. Ms. Shaw was happy with the job at the time but said the site now needs a major overhaul. Her top priorities are making it more current, streamlined, and easy to navigate.

Beth Shaw, owner of YogaFitSuzanne DeChillo/The New York Times Beth Shaw, owner of YogaFit

“We’ve got so many moving parts — clothing, conferences and trainings, and content, but it needs to be much more simple,” she said. She wants a modern look and said the Web site for fitness program Zumba exemplifies what she likes. She also appreciates the simplicity of the Web site for Flywheel, a company that offers indoor cycling classes and other fitness programs. But finding a Web design and development firm has been a challenge.

Earlier this fall, she thought the search was over. But the company, which designs and develops Web sites for many yoga industry clients, wanted YogaFit to switch to its back-end system. YogaFit now uses Orderwave to handle back-end tasks like processing payments and managing orders and inventory, and Ms. Shaw said it spent at least $100,000 to customize code for the system. On top of that, the system the Web designer and developer proposed was incompatible with QuickBooks. For Ms. Shaw, the last straw was the $50,000 price tag that YogaFit was quoted for a new site.

Upon reflection, Ms. Shaw is glad she didn’t go with that firm for another reason. She thinks that choosing a company that specializes in building yoga-related sites would have been a big mistake. Although the previous Web developer did not have clients that directly competed with YogaFit, Ms. Shaw wondered about its allegiances. Additionally, she said she wants the “creativity and freshness” that come from embracing what companies in other industries are doing.

Ms. Shaw said she believed she recently found a better option. YogaFit is in the final stages of negotiating a contract with New Possibilities Group, a Web development and design firm and expects to have its new site up and running by January 1. Ms. Shaw said an “online fishing expedition” led her to this firm — but she is optimistic. The new firm can work with YogaFit’s backend system and will charge about $23,000 to change the site’s look and navigation. Ms. Shaw said she is especially encouraged that New Possibilities told her it takes on just one project at a time and will place 10 people on YogaFit’s account.

As she begins the process, Ms. Shaw would appreciate readers suggestions on how she can create a Web site that is accessible to yoga professionals and to more casual enthusiasts, both of which are consumers of YogaFit’s trainings and products. She sometimes wonders whether she needs two separate sites.

Also, if you have tips on how to work with a Web design firm, please share them.

You can follow Adriana Gardella on Twitter.

Article source: http://boss.blogs.nytimes.com/2012/11/27/yogafit-decides-its-web-site-needs-to-shape-up/?partner=rss&emc=rss

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You’re the Boss Blog: Can a Banker Think Like an Entrepreneur?

August 31, 2012 by Leave a Comment

She Owns It

Portraits of women entrepreneurs.

In a just-published New York Times article, I write about Jolyne Caruso, a Wall Street veteran who founded the Alberleen Group, a company that applies the incubator concept — ubiquitous in the world of tech start-ups — to investment banking. The Alberleen Group provides seasoned investment bankers with the infrastructure and working capital to start their own firms. In exchange, it takes a revenue share.

Ms. Caruso got the idea for her venture after observing that many bankers — and their clients — were disillusioned with the big banks. New regulations, altered compensation models, and (for clients) the potential for conflicts of interest contribute to the “misery factor,” she said. But for bankers looking to strike out on their own, the costs of starting a boutique investment bank can be prohibitively high and the connections needed to fund deals can be elusive. The Alberleen Group offers help with both. Every member of the incubator’s advisory board, which includes E. Stanley O’Neal, the former chief executive of Merrill Lynch, is also an investor in the company.

The incubator’s success will depend, in part, on its ability to field teams of bankers who think — and operate — like entrepreneurs despite having spent careers at the much larger institutions that have long dominated the industry. “The jury is still out on us,” Ms. Caruso said.

But she added that it’s clear that the old model is no longer viable for many clients and bankers — which could make investment banking incubators as plentiful as their technology counterparts.

You can follow Adriana Gardella on Twitter.

Article source: http://boss.blogs.nytimes.com/2012/08/14/can-a-banker-think-like-an-entrepreneur/?partner=rss&emc=rss

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You’re the Boss Blog: Are You Prepared for a Double-Dip Recession?

August 11, 2011 by Leave a Comment

Elizabeth Lunney, co-founder of ABC Language Exchange, is watching sales and preparing to make cuts.Ángel Franco/The New York TimesElizabeth Lunney, co-founder of ABC Language Exchange, is watching sales and preparing to make cuts.

She Owns It

Portraits of women entrepreneurs.

We just published an article that surveyed small-business owners on the impact of recent financial news, and their coping strategies for a possible double-dip recession. “We’ve been through this before,” said Elizabeth Lunney, who is co-founder and chief executive of the language school ABC Language Exchange and who shared her experiences with daily deal Web sites in a previous post. Here’s what she had to say:

“I’m looking at my numbers every single day and going through the list figuring out what I’d get rid of first. So far, we’re having our best year ever, but if I see that sales start to drop 10 to 15 percent in a week and see that it’s a trend over the next two or three weeks, I’ll start cutting. The water cooler, and other extras like employee lunches, will be the first to go. After that, I’ll consider asking the staff to take pay cuts, which I prefer to layoffs. Last time, I was the first to take a pay cut. I brought my salary down to what I needed to pay rent and eat bologna.”

How have you been coping with recent economic turmoil? Please share your experiences and survival tips.

You can follow Adriana Gardella on Twitter.

Article source: http://feeds.nytimes.com/click.phdo?i=fc4e8ab883190ccd7ff589e672bfc772

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You’re the Boss: Angel Investors Learning to Assess Business Plans

July 6, 2011 by Leave a Comment

Nancy Y. Taylor (standing) pitches her company, Gifts that Give.Erica TorresNancy Y. Taylor (standing) pitches her company, Gifts That Give.

She Owns It

Portraits of women entrepreneurs.

In April, I wrote about the Pipeline Fund Fellowship, which is training its inaugural group of 10 female fellows to become angel investors. Since then, the fellows have moved several steps closer to choosing the business that will receive their pooled resources of $50,000. During a daylong event held last month at Eileen Fisher headquarters in Irvington, N.Y., they heard pitches from 10 start-ups seeking financing and narrowed the field to three. Of those, one will be chosen to receive the $50,000.

A total of 52 companies applied to pitch. Pursuant to Pipeline Fund Fellowship rules, each had to be a for-profit, social venture led by a woman. “In about a third of the applications, it was clear people hadn’t listened,” said Conor Barnes, a fellow and a bookkeeper with Good Cents Bookkeeping, a provider of financial management services for small businesses.

Ms. Barnes said that in the weeks before the event the fellows quickly eliminated applicants who failed to satisfy basic requirements and invited 13 companies to pitch (three declined for various reasons). Each fellow was then assigned one of the companies to research in preparation for leading the questioning after the pitch.

Ms. Barnes said that during the pitches, she hoped to hear that the founders had more than “just another new product or service.” In addition to articulating the venture’s social impact and detailing how it would use the $50,000, she expected the founders to demonstrate that their companies were game-changers. She also wanted founders to explain why they had approached Pipeline — and not, for example, a bank or venture capital firm. (Kelly Hoey, a fellow, said scarce financing options probably drove some of the entrepreneurs to grasp at any opportunity without regard to fit.)

Companies that had already built communities and connected with their target markets through, for example, a Web site, were appealing to Ms. Barnes. To further impress her, founders had to demonstrate that they were coachable. The best way to do that, she said, was to answer the fellows’ questions. “If we ask, ‘What’s your revenue?’ just give us the number,” she said. She estimated that founders answered only about 25 percent of the questions asked.

Elizabeth Crowell, another fellow, said she was amazed that “nearly every pitch failed to outline how much the product or service cost and its price to customers.” She said that although the founders sat in on all the pitches and heard the fellows repeatedly ask these questions, later presenters didn’t work cost and price data into their seven-minute pitches. Over all, though, Ms. Crowell said the pitches impressed her, particularly given that the founders were “as green as we the investors.”

In the days following the pitches, the investors conferred and chose to move forward with due diligence on three ventures: Just Shea, an organic cosmetics company ; LuminAID Lab, a provider of portable lighting for victims of natural disasters (formerly the Solar Light Pillow Project); and PhilanTech, which develops and sells an online grant-management tool for nonprofit organizations and foundations. Throughout the selection process, Ms. Crowell said, she was struck by the degree of alignment among the “10 fairly opinionated” fellows.

Both Ms. Crowell and Ms. Barnes said they are hooked on investing. Ms. Crowell said that she sees herself continuing to work as part of an angel network or group going forward. Although Ms. Barnes said she loved investing as part of a group, she had decided she could also go solo. “This experience has gotten me really excited to think of myself as an investor,” she said.

The fellows will spend the summer applying the lessons they learn at a coming due diligence workshop, and the company chosen to receive their investment will be announced in October. I’ll report back on how the process unfolds.

You can follow Adriana Gardella on Twitter.

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