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Founder Spotlight: Caterina Meloni

by NICOLE DENHOLDER|10 July 2020

Connecting Founders – Meet Caterina Meloni

Caterina Meloni is the founder and managing director of Connecting Founders. Headquartered in Bangkok but servicing entrepreneurs across the region, the company provides capital advisory support services to female founders. That means helping them structure a tailored funding plan and then matching them with like-minded capital to help scale their businesses. Connecting Founders works with both entrepreneurs and funders to come up with optimal financing solutions that address the needs of small businesses while meeting the rigid requirements of investors.

 

Why did you set up Connecting Founders?

I set up Connecting Founders back in 2015 because I felt there was a need for a business platform that catered to female founders in Thailand. We started by inviting seasoned female entrepreneurs to share their experiences and lessons learned from running a business so that new founders were better equipped with critical skills and confidence for their businesses to flourish. After a couple of years, we decided to focus exclusively on providing capital advice as this was one of the key issues for the entrepreneurs in our network.

At the same time, I also wanted to bring change to a business sector to become more responsive to the different needs of female founders while promoting a more diverse decision-making landscape and a fairer resource allocation. When you have a look at statistics in the business sector, the numbers for women in key management positions is actually good but I wasn’t seeing that representation at major business events. There weren’t enough women who were part of the bigger business conversation at an industry level.

 

Was it unusual to create a company directed towards women when Thailand didn’t appear to have a gender problem?

Short answer, yes. There are lots of women in business in Thailand so the question was, what needs to change? For a start, at key networking events, most of the speakers were men. There was a very small pool of women called on to provide commentary and they were the same handful of women at every event. So, I created Connected Founders and since then we’ve worked with great partners including Orami and the US State Department to drive this change.

 

What kind of financial advisory services are you providing female founders? 

Our work with clients covers the full spectrum of the investment cycle, most importantly capital structuring, funding strategy and investor outreach and management to ensure our clients receive optimal returns in line with their long-term strategic goals. Our services range from monthly retainer engagements to provide essential financial advice, such as cash flow planning, to support in more complex tasks, such as optimizing capital structures, and deal structuring to agency representation in capital raising and strategic partnerships.

 

How do you work with female founders?

Connecting Founders is really there to consolidate the entrepreneur’s whole strategic fundraising plan. That means testing the assumptions they’ve made and making sure their story is airtight. During that process there’s a lot of reflection, we really want to study the story behind the numbers. How are the founders creating value? Can they execute their vision? What we’re really looking for are holes, risks and opportunities.

 

What are the key growth challenges for female founders in Asia?

They’re really the same growth challenges we see elsewhere. Bias is a big issue. There’s an inherent and often unconscious bias against women-owned businesses in terms of growth and potential. That exists at every level right across society and not just with investors. When you tell people you run your own company, as a woman the assumption is it’s a small business, the growth rate is slower and smaller and revenues are less than a business of a similar size run by a man.

 

Where are most founders in their journey when they come to see you?

Most founders are at the growth stage – they have products and services that have clear market validation. What they really need to do now is expand both in terms of products and markets. For us, it’s really rewarding to work with growth founders who already have a track record. They know their value proposition and where they want to go. They have a specific plan for expansion and creating additional revenue streams. While we get more introductions to established companies, we also work with founders who are in the idea stage.

 

What are the biggest strengths and weaknesses in the female founders you come across?

For both female and male founders, there’s definitely a knowledge gap around presenting risks and opportunities clearly and effectively. They don’t always know how to present their business to an investor in a way they would fully appreciate and understand. They’re prepared for the pitch but can’t talk about the customer acquisition costs or how they’d achieve healthy and reasonable growth, efficient business practises and sustainability. They know their unique selling point, they can articulate their business idea and talk confidently about the team but that’s just one part of the story.

 

How receptive are female entrepreneurs to this kind of business honesty?

We work with very ambitious founders across Asia. In South East Asia in particular, there are lots of opportunities so founders are in a privileged position because of booming demand. At the same time founders, be they male or female, need to be realistic about their growth predictions. The good news is, we’ve found that overall, women in business don’t have inflated predictions and are able to maintain those realistic outcomes.

 

What topics do founders need the most education about?

Equity, valuation, and other forms of financing available. A lot of entrepreneurs have a valuation idea in mind but they’re not able to justify why that number is reasonable or substantiate it. One of the important aspects of being a capital advisor is preparing a funding plan. Many entrepreneurs see this as a one off but it’s critical to think of this as a long game. Plus, they need to be able to go deep into a term sheet and investor agreement and really understand the fine print and not just hand it off to the advisor. We don’t expect an entrepreneur to become an investment professional but they need to understand what they’re applying for and signing.

 

Is there anything that sets apart female founders in Asia from other regions? And how would you rank them in terms of global potential?

Overall, I think founders here rank highly. The outlook is positive and mirrors the average growth rates of the countries they live in. The networks for female founders and female investors are now much stronger than they were a few years ago. There’s more awareness of the benefits of having something dedicated to women and connection at a regional level is also much stronger.

 

Why are there still so few female-run angel investor networks in Asia?

There is an element of practicality here. It’s hard to run these networks. In Europe and the US, they get help from other institutions but that hasn’t reached Asia yet en masse. One of the other big challenges is due diligence and moving the opportunities along. Women have less access to information about investment opportunities, I see it all the time at conferences and events. A group of men will be standing around talking about something investment related and when a woman joins the group they shift the conversation to something they see as more inclusive.  On the flip side, I am seeing lots of interest by women in investing albeit at a lower entry/price point, but the market now has to harness that interest.

 

What’s your biggest tip to a female founder seeking capital or investment?

When you are preparing for a raise, know your business inside out and base that knowledge on key data metrics. You have to be able to quickly present your business to an investor in a way that builds immediate confidence; costs, revenues, profit margins. Plus, you need to know your Unique Value Proposition and be laser focused about what makes you different, what guarantees business growth in the long term.