What if five women wanted to launch a “boys only” social club? Would you bet money on it?
Most likely, you’d laugh them out of the room.
Yet flip the cards, and you might have one of Australia’s largest venture capital firms appearing to support you. Last week, Kiki, a US-based start-up which counts Blackbird Ventures as one of its investors, pivoted from a subletting business to a girls-only social club.
Toby Thomas-Smith (second from right) and the Kiki team have come under fire for its pivot from a subletting business to a girls only social club.Credit: Kiki
Kiki launched as EasyRent in New Zealand, before moving to Sydney in 2022 and rebranding and relocating to New York last year after raising $7 million.
What’s strange about this girls-only club is that it’s a business led by five men, which only hired its first woman, Caitlin Emiko, to run its social media channels in December.
Five months ago, Kiki was a team of three men, and co-founder Toby Thomas-Smith admitted on LinkedIn that “we can’t become 30 dudes”, and that he wanted to hire women, given 70 per cent of the company’s users were women.
More than 300 applications later, two of the three jobs Kiki advertised were awarded to men and the final job was left vacant.
Now, with women to comprise all of Kiki’s users, it’s no surprise the company has copped backlash.
In an Instagram post announcing the pivot this month, Thomas-Smith said Emiko had enlightened him to “this huge problem I never even knew existed”.
One comment on the post attracted more than 280 likes. “While building safe spaces for women couldn’t be more important, there is a huge safety, trust and responsibility that comes with this,” said Emma Bates, co-founder of social search engine Diem. “This isn’t just a business opportunity you get to ‘open your eyes’ to when you talk to one woman who shares a problem with you.”
That sentiment has been echoed by others who point to the inequalities of the start-up ecosystem. Ventures led by women tend to receive less funding and are priced at lower valuations than those led by men.
One of Kiki’s Instagram posts.
Kirstin Hunter, managing director of start-up accelerator TechStars, said Kiki’s case demonstrated the difference in treatment and opportunities extended to male founders compared to their female counterparts.
“Female founders have this really high burden of proof,” she said. “Investors expect them to demonstrate a very high likelihood that their business will be successful, whereas male founders tend to get the opportunity to prove themselves.”
Lucy Wark, co-founder of soft skills company Fuzzy, said the smaller proportion of funded women-led start-ups reflected more than just a smaller pool of female candidates and access to existing networks.
“There’s strong evidence that female founders are asked more preventative questions focused on downside risk whereas male founders are asked more promotional questions in pitch meetings,” she said.
Techstars’ Kirstin Hunter says the Kiki case highlights the difference in treatment and chances provided to male and female start-up founders.Credit: Edwina Pickles
Hunter said when selecting founders, she looked for qualifications including those with a deep connection to the problem, specific expertise and lived experience.
“From the perspective of an investor, those things are missing in [Kiki’s] situation,” she said. “If they just discovered the problem, and it’s something they have never experienced, it’s hard to imagine they have the skills to solve it.”
On Thursday, a spokesperson for Blackbird said both it and Kiki recognised that Thomas-Smith’s recent social media post had “regrettably caused frustration and in some cases offence” and they had “taken on board all feedback”. Kiki did not respond to requests for comment.
But given Blackbird positions itself as a leader in the venture capital space, its immediate reaction should have mirrored the public outrage which followed: that an all male-led team with no lived experience in women’s issues should be more careful when designing and monetising a solution for women.
Lucy Wark (right), pictured with Grapevine co-founder Misha Garg, says Kiki’s practices need a rethink.Credit: Janie Barrett
Roughly 24 per cent of Australian start-up founders were female in 2022, yet only 10 per cent of venture capital funding went to start-ups where there was at least one woman in a co-founding team.
Hunter said the extent of that discrepancy – given women-led start-ups and those with mixed gender teams tend to deliver stronger returns – spoke to bias from investors.
Kiki’s recent pivot could be one of the “crazy marketing tactics” its recently hired launcher, Mihailo Bozic, has flagged that will help the start-up become known in New York. Kiki’s marketing stunts have included Thomas-Smith appearing in underwear on New Zealand breakfast TV.
But Wark said Kiki’s case illustrated the double standards female founders faced, such as male founders being applauded for stunts that would be seen as unprofessional and sexualised in a female leader.
While it’s positive to see interest from men in the problems women face, Kiki’s mission remains unclear, and there needs to be more meaningful engagement from start-ups with those they’re claiming to serve.
“As someone who has been harassed in pitch meetings and regularly hit on in my LinkedIn messages, I choose every word and outfit carefully, just so I am taken seriously,” she said.
Wark said Kiki’s hiring and management practices – which have, according to Instagram, included asking potential hires to attend pre-drinks to check their cultural fit and handcuffing a female employee to a co-founder for 12 hours – also needed a rethink given risk factors that can lead to harassment.
Venture capitalist Elaine Stead, speaking on a podcast in December, said having a diverse team showed a business’s ability to take on feedback and work with people who see the world differently.
“If you have a diverse team, what you’re actually signalling ... is that you can work functionally and well with a bunch of people who are not like you, who think and see the world differently,” she said.
“I think that’s necessary in order to solve problems that haven’t been solved before.”
Kiki’s change of tack – which according to reporting by Capital Brief, came after Thomas-Smith emailed investors to say “NYC is almost too diverse” and made it hard to stick to a niche – seems to be a rushed attempt to capture potential sublet users.
Thomas-Smith indicated 20 “tightly hand-picked women” would be added to a group chat and within three weeks would start treating Kiki like any other close friend group chat and discuss subletting opportunities, according to the email.
While it’s positive to see interest from men in the problems women face, Kiki’s mission remains unclear, and there needs to be more meaningful engagement from start-ups with those they’re claiming to serve.
There’s also a role for government and investors to improve the start-up space for women, especially given the higher returns yielded by women-led and mixed-gender start-ups.
“The legislation in California requiring mandatory disclosure of diversity statistics for investors is a really good step forward for the ecosystem,” Hunter said. She added that investors and super funds could also push on the issue.
For Kiki to succeed from here, its management will need to demonstrate a deep connection to whichever problems they are trying to address – and a greater commitment and care towards understanding their users who, in either case, are mostly women. But it’s also important for investors such as Blackbird to reflect on their responsibilities and blind spots, and to think about the best ways they can support start-ups by, and for, a demographic that makes up half of the world.
Ross Gittins is on leave.
The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.
login
who are we?
contact us
qosheapp
Toi Staff
Gideon Levy
Belen Fernandez
Andrew Mitrovica
Mort Laitner
Nikkei Editorial
Rami G Khouri
Ali Fathollah-Nejad
visit website
