By Mitchell Jackson
The Skimm, Glamsquad, Flex, Teadrops, Carbon38 share one fact: Venture capitalist Jesse Draper invested in the leading brands. Since 2015, Draper’s Halogen Ventures has solely invested in women-founded start-ups, earning huge returns in the process. Twitter purchased a Halogen-backed app called Squad, and Walmart acquired Eloquii for $100 million. And those are just a glimpse at Draper’s investment success.
“Investing in women isn’t a charity,” Draper says. “It’s a $3 Trillion business opportunity.”
Draper would know. She learned about investing as a young child, accompanying her father, legendary venture capitalist Tim Draper, on his business trips. Draper didn’t originally intend to enter her father’s industry. She presumed she would follow her aunt Thirtysomething star Polly Draper’s footsteps and become an actress. She graduated from UCLA’s School of Theatre, Film, and TV, then acted as a boy band’s tutor on Nickelodeon’s The Naked Brothers Band. Draper wore hot pink dresses and fake tattoos. “I was always in a costume for so many years,” Draper says. “On the Nickelodeon show, I had to have [fake] tattoos all over my body. I couldn’t take off for weeks at a time.” She earned a name as a bubbly comedian.
She could have pivoted into a feature film career, like Miley Cyrus, but acting wore on her. She would attend auditions, where hoards of actresses would compete over roles. They were quite literally cattle calls. “I actually had quite a bit of success,” Draper says. “It was great, but I was not fulfilled,” Draper says. “I had so many fun experiences, but it’s just not what I wanted to do.” Draper found herself thinking about other opportunities.
In 2008-2009, Draper was one of the first people to sign up for Twitter which was her entry back into technology, and she’s always gravitated towards the latest tech as she grew up in Silicon Valley. Draper saw the huge gender disparity in venture capital and technology. A natural entrepreneur, she decided to fix the problem, creating the online interview program The Valley Girl Show. It blew up, eventually getting picked up as a syndicated television talk show and receiving an Emmy nomination.
Ambitious female founders began pitching themselves to be on the show. “It was like this Batwoman signal because I was looking for women [to interview],” Draper says. Often, Draper found their businesses too early to have on the show, but she would direct them to VC firms in Silicon Valley when she spotted their early stage potential. From her home in Los Angeles, Draper watched many of these founders succeed. She clearly knew a good investment when she saw one from Sugarfina to This is L. (Sold to P&G in 2019), she began writing small investment checks to female-founded start-ups on her own.
Show business began to take a toll. Working non-stop on the production of The Valley Girl show, and running a media technology company acquiring blogs like Lalawag, Jesse continued to invest in early stage companies on the side. “I built a portfolio that quickly started to see returns,” Draper says. “One of those deals I ended up selling for 25x in less than 18 months.”
One day, her husband, Brian MacInnes, pointed out that her investments were going better financially than her show: “Have you considered setting aside The Valley Girl show and going to do this full-time?” he asked.
In 2015, Draper took the jump, founding Halogen Ventures. She pitched 500 investors on why investing in gender diverse teams would create better returns. Women, after all, make 80 percent of household purchases. “Investing in women is not only important and making an impact,” Draper says. “It’s also a better business opportunity.” Fifty investors invested in Halogen’s first $10 million dollar fund. Since then, Halogen has invested in a total of 62+ companies, closed a second fund at $21 million and has had 10 exits in under six years. Now, Draper is the one offering young women advice.
“In terms of the products and technologies that we invest in, we provide more than just capital. We are strategic partners to our founders and help with finance, PR/Marketing, and go-to market strategy,” Draper says.
While she has made a name in the best of consumer technology and beyond from fashion e-commerce companies to femtech, one of her investments is a transportation company called HopSkipDrive, Founded by Joanna McFarland, the company began as an Uber-like system for transporting children to school more safely. The Los Angeles City Foster Care System quickly reached out to Hopskipdrive. HopSkipDrive began providing rides for foster care families and the government became a customer. Jesse gives McFarland credit for opening her eyes to the fact that the government is a bigger customer than the fortune 500 companies combined and created a whole new thesis within the Halogen fund in addition to her usual investments. Companies that solve government inefficiencies of which there are far too many, and this is more apparent today than ever before.
Halogen has since invested in software company Binti which provides technology to better and more quickly place children in adoptive and foster homes. “It’s making an impact and making big money,” Draper says. “This is a huge opportunity that no is looking at right now. While there is massive funding going into future concepts like space exploration and self-driving cars, we have companies that are actually solving the problems of today. I do think this is one of the benefits a female perspective can offer.” Solving the problems like childcare, foster care, security and education as for profit endeavors. ‘While there is a place for non-profits, we are doing women a disservice by only giving away money instead of investing in them as for profit opportunities.’
Solving problems is key to Draper. When she isn’t leading venture rounds, making for profit impact, she supports the Parkinson’s Institute and serves on the non-profit boards of Bizworld and Project Glimmer which supports women in the foster care system. She’s an active alumni at UCLA through their entrepreneurship community. Draper sits on the for-profit boards of Carbon38, Preemadonna, Style Row and fintech company Trust & Will.
In fall of 2020, Jesse wrote an opinion piece that went viral with over one million views in just a few weeks, sparking conversation around the case of investing in women and how there is still a long way to go to change the perception from philanthropy to a smart, strategic business move. To quote draper from her article, “Investing in Women Is Not a F&cking Charity,” “Imagine a future where women have access to more capital, where we are building diverse teams and founding billion dollar businesses, where we have access to power and wealth and can use that to build a better world. We need to change the trajectory. We can do this by investing in women. This is the time we change this old school mentality with this call to action to all of the institutional investors, endowments, Fund of Funds and Family Offices. As painful as 2020 has been for so many, I hope this is the turning point. Invest in women. We’re not a charity. We’re a $3 Trillion Opportunity.”