Q&A: Modwenna Rees-Mogg on the rise of the female investor

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Q&A: Modwenna Rees-Mogg on the rise of the female investor

More women are becoming entrepreneurs, financially literate and keen investors – but what advice do they need to help them succeed?

Modwenna Rees-Mogg, founder of AngelNews and chair of The Pluralists Club, talks to FTAdviser In Focus about the slow but steady rise of female entrepreneurism and women investors, and what can be done to encourage this growth.

Rees-Mogg, with a background in corporate finance and a keen financial journalist herself, says there are still barriers that need to be broken down to allow women investors to thrive, and thereby help Britain's entrepreneurs to succeed. 

FTAdviser: What first attracted you to the world of investments?

Modwenna Rees-Mogg: It was an intense curiosity about how the world functions economically, particularly around how capital can be deployed to create economic growth and increased productivity, especially through the growth of innovative businesses. 

FTA: How difficult has it been as a woman to enter what has been a traditionally male-dominated world?

MRM: Funnily enough, I have never seen gender as an issue. I have never thought or think that my gender should stop me from anything I thought I was competent to achieve.

I was significantly helped (and continue to be helped) by amazing men and women who champion me. With hindsight I realise that some people are biased, but that is their issue not mine.

FTA: In your experience, how many angel investors are women, and how many female-founded businesses are supported by angels?

MRM: Not enough, but this is for many reasons and it is dangerous to generalise. I believe the numbers are rising and in the US the percentage of women and BAME investors is growing healthily.

I understand the number of women investors in the UK is now somewhere around 10-20 per cent, and in the US it is now 27 per cent. A good report to read on the subject is the Angel Capital Association's Angel Funders Report 2020

The numbers will grow faster now that more women are creating their own wealth through a successful career or building a successful entrepreneurial business.

Get your female partners, daughters, sisters, mothers, friends and colleagues involved in what you do.Rees-Mogg

For women who want to dip their toe in the water, I would encourage them to do two things:

  1. Play with tiny sums (e.g. £100 or even just £10 per investment) on one of the crowdfunding platforms and perhaps accept this money will be the cost of educating yourself about the joys and perils of backing entrepreneurs in unquoted businesses.
  2. Then, join one of the brilliant women-focused angel investment groups that have emerged recently, make friends with other angels who are like-minded in terms of their approach to investing. Once you are extremely comfortable about how it all works, then start to make a few investments with money you can absolutely afford to lose.

To be honest I wish more angels would see the value in investing some money in learning how to be an angel (typically such training can be tax deductible). This is true for all angels, regardless of diversity issues.

The angels who take time to understand what they are doing before starting to invest tend, in my experience, to last the course and angel investing becomes a long-term interesting, pleasurable and financially fruitful occupation. 

I am concerned about how few women or BAME entrepreneurs successfully raise funding, but I see that the investment market is now trying hard to address this issue.

On my to-do list I have a plan to write a rip-roaring novel about a woman who starts a business and is backed by angels, with lots of exciting highs and lows in the narrative.

Should it be good enough and maybe – just maybe – become a bestseller, it would bring the world I inhabit to a wide audience and give many more women permission to have a go, but I need the time to put pen to paper. In the meantime Dragon’s Den does a great job on TV.

FTA: Talking about books, you've just published another one. Could you tell us about it and how this might help more women investors support emerging businesses?

MRM: The greatest part of my angel time is spent working with angel markets outside the UK where the dynamism and enthusiasm of the parties involved is addictive.

I was commissioned by the World Business Angels Investment Forum to co-author (with WBAF chair Baybars Altuntas) a definitive guide to angel investing that would be suitable for angels all over the world, as they are present in more than 100 countries.

The book is part of their wider strategy to develop and co-ordinate angel markets across the globe. The project turned into a major exercise as the book ended up running into 150,000 words with loads of graphics.

I would encourage people to take their time to understand the risks before actually spending any money on investments.Rees-Mogg

I had to write in plain English that could be easily understood if English is your second language. The book turned out to be so comprehensive that we agreed that as well as publishing it whole, we would also publish in parts – so one book became 28.

The good news for readers is if they only want to learn about one part of angel investing they can buy one of the smaller books.

We also have some exciting plans to use the book to support more training solutions for angels. I already regularly train angels all over the world on Zoom for WBAF – Bahrain, Thailand and Nigeria are in the diary right now. 

FTA: What’s the elevator pitch? 

MRM: In a few hours you will go from being a rookie innocent to becoming the very best angel backer of a great entrepreneur.

Not only will you increase your chances of enjoying being an angel and making money, but also finding the right entrepreneurs to back and helping them to succeed.

The icing on the cake will be that you also will learn fun facts about angel markets across the world, learn how governments could (or should?) support angel investing and why and how to run your own club or syndicates of angels.

FTA: Why is it important to encourage more women into managing their wealth and investing?

MRM: Most of all its because being able to manage your own wealth and becoming a successful investor is empowering.

Making money is a great outcome of course, but actively managing your wealth and investing teaches you how to analyse, manage risk and learn about new industries and economies.

It also takes you into new communities; other investors, entrepreneurship and the advisory market. Whatever your gender, if you have children you set an example for them too.

One of the greatest joys of angel investing is that you back the future. Angels have backed most of the world’s greatest companies when they were rookie start-ups.

Who would not like to say they were partly responsible for the emergence of new technologies (and the rest) that have gone on to change the world for the better?

FTA: How can financial services professionals help to break down barriers to help more women become confident investors?

MRM: I think it starts in school. We need to include business, investment and wealth management into the school curriculum from reception onwards.

Twenty minutes a week every week for 13 years playing shop, running a cake stall or even selling a school newsletter for 10p would not just teach children how to count but also teach children about risk management, team work, innovation, marketing, selling, investment, finance, business models, economics and tax in an organic way.

Not only would this create more business leaders of the future, but it would also train those who do not want to be leaders but who do need or want to work in a business about how it all works.

A useful aside would be that more people would enter the workforce at least part trained, which would help the economy more generally and start to improve the UK’s poor productivity rates.

Meanwhile, those responsible for secondary and tertiary education could start today by setting up clubs for students to learn about all the different types of investment and practice doing it. 

For adults, the tools are out there that are easy to access. There are many amazing business books, websites and informal clubs of investors. For example, The Pluralists Club has a stock market club and an angel club within it where we discuss aspects of investing.

I would encourage people to just dive in and be prepared to take their time to understand the risks before actually spending any money on investments. 

To those who care about helping others to become 'millionaire makers', I would say stop for a minute and think about what you can do to help.

Get your female partners, daughters, sisters, mothers, friends and colleagues involved in what you do.

Don’t just teach them the mechanics and jargon, useful though they are. Teach them all the soft stuff, especially how informal business/investment gets done. And don’t forget to help them find a trusted circle of advisers who will support them properly. 

Jargon busting can be solved by reading glossaries and dictionaries. If anyone wants a list of jargon used in venture capital or angel investment, get in touch and I will send you mine – but be warned, it’s pages long.

simoney.kyriakou@ft.com