By Ruiqi Chen
Dana Todd founded Balodana, an online made-to-order retail platform for women, in fall 2019 after many years in and out of the corporate world and entrepreneurship. Todd said the freedom of entrepreneurship ultimately led her to pursue this startup, which she hoped can give women greater confidence in their appearance and clothing. But the business doesn’t come without challenges. Accessing funding as a woman has been especially difficult, she said. Todd discussed her ideas for how that can change.
Why was the idea of Balodana so compelling to you?
I believe in starting companies with very big ideas, and I had a sense that this would be big. I had a spidey sense, my hair stood up, and my whole body was electrified when I hit upon the idea and started doing more research. Everything told me that this was going to be very, very, very big.
The company easily worth a billion dollars in sales once we convert 10% of the 56 million women who fall into our general category for targeting, but the more important, and the more exciting, part to me is systemic. As I’ve gotten into this, I’ve understood the damage fast fashion and all garment manufacturing has on the planet, and how very, very broken that system is. It’s an area that needs to be changed because there’s still slavery, and usually female slavery, in the supply chain for garments.
But the fashion industry itself does not want to change. The fashion industry and the garment industry are worth $3 trillion. It’s massive and right up there with oil and gas, and it is utterly ripe for disruption.
In the past, you’ve cofounded other tech companies and later worked in the corporate world as a CMO for multiple companies. What made you decide to return to entrepreneurship?
After shutting down a tech company in 2010 following the recession, I decided that entrepreneurialism was too dangerous and too risky. For two years, we were scraping every penny that we had out of our retirement funds and leveraging our houses, but it finally got too dangerous for us to keep the company alive. So, I decided I would go to the corporate side where it was safe. But after three layoffs in a row, I realized that corporate wasn’t safe either.
I felt ultimately that in most organizations, women are not given total freedom. What entrepreneurship offers you is total freedom to succeed wildly or freedom to completely fail. You have a lot more control over your destiny in that respect. You see your balance sheet and you know 100% of your risks. When you’re an entrepreneur and you’re the owner of the business, it may not be pretty, and it’s just as stressful as you can imagine, but it’s a kind of an incredible journey.
As a woman who’s been in the entrepreneurial space for a long time, what do you think is a major challenge that women business founders face?
The biggest thing that can benefit women business founders is more funding by women. In general, early stage startups in Chicago don’t get a lot of funding, and the bottom line is women get even less of that.
Our investors are all male, so it’s not that men don’t believe in a company run by a woman. It’s that all investors of early stage companies are influenced heavily by chemistry. They consider factors like “Do I like that person?” and “Do I like their idea?” It’s mostly about the founder, and it’s harder for men to just immediately like women.
According to research and analytics company PitchBook, only 2.7% of venture capital went to female-founded startups in 2019. How can that investment gap be overcome?
We need more rich women who are investing and are being taught to invest at all levels. There just aren’t as many female millionaires walking around with a desire to invest in startups. Some of them put their money into nonprofits or other things, but if a lot more women started investing their money into startups, then you’ll have a more level playing field.
So how do we get more rich women, and how do we get them to invest in other women?
It starts with education and awareness. You don’t typically teach women how to invest in anything other than their own portfolios, but we should talk to them about becoming a private investor, becoming a venture capitalist.
When I started Balodana, I talked to some female investors who are friends with money or had been involved in funding in some way. But I found that the pool of female investors for female-branded ventures to be very small. You run into the same people. There’s a lot of support and positive thinking, but I still don’t think there’s enough money flowing freely to support the numbers of female-founded ventures out there.