In 2021, almost half of the startups in the United States were founded by women, as reported in a survey by Gusto. This marked a significant increase from 2019 when women comprised only 28% of startup founders.
However, when looking specifically at solo startup founders, women represented a smaller proportion, accounting for just 14% in 2021. Additionally, a report from Forbes indicated that women received a mere 2% of the venture capital (VC) funding deployed in 2022. In 2023, only 15% of tech startup founders are female.
But that’s slowly changing around across the globe, particularly in Eastern Europe. Some of the people leading this change are a group of women investors. Challenging gender stereotypes about women’s low participation in the field, these investors recently invested in “The Knotty Ones,” an all-female-founded ethical knitwear brand from Lithuania.
This week, “The Knotty Ones” announced it has raised €250K from women investors including Giedrė Dukauskaitė, a famous model and long-time ambassador of “The Knotty Ones,” a new syndicate of female business angels, and Viktorija Trimbel, the Managing Director of Coinvest Capital – an early-stage venture capital fund.
Joining this round is a group of women investors including philanthropist Erin Gainer-Grigaliūnė, fashion strategist Ieva Zubavičiūtė, actress Gelminė Glemžaitė, and lawyer Karina Andriukaitiene, making it more accessible for women who want to start investing with smaller tickets. This syndicate of women angels has made an investment to make investing more accessible for women, particularly those looking to start with smaller investments.
According to Viktorija Trimbel, the managing director of Coinvest Capital Fund and one of the investors, this investment marks a shift in the world of investment, indicating that gender stereotypes are becoming a thing of the past. She highlighted that investing is gaining popularity among women, and female-led businesses often prove successful, with 59% of them turning a profit.
Co-founded by three female friends, Akvilė Meškauskaite-Dobrajs, and Sandra Pangonytė, the trio, like many of us, spent their early twenties chasing the latest fashion trends and fads. The “The Knotty Ones” production is mostly done locally, as it is based on Baltic knitting traditions, even though 90% of the garments are sold to foreign markets, such as the USA, UK, Australia, Germany, and other Western countries.
“The new investment is breaking the stereotypes by showing that an all-female team can be investors in other female-founded businesses,” said Viktorija Trimbel. “Generally speaking, investing is becoming more popular among women, and female investments are often more successful than men’s – 59% of all businesses founded by women are profitable. Women take a longer-term investment perspective and more thoroughly assess potential risks, which is why many women-owned startups are often thriving.”
The €250K investment will facilitate further international expansion, with a particular focus on the United States through wholesale and e-commerce channels. The founders are pleased to have attracted Lithuanian investors and plan to continue their growth in the right direction with international fundraising in the future.
“The Knotty Ones” provides job opportunities to talented, independently employed female artisans in rural Lithuania. The artisans work at their convenience, have spare time for their hobbies, and can combine work with motherhood, while financially supporting their families in less privileged regions of the country. One of the key factors contributing to the success of the company is its loyalty to values based on sustainability and social responsibility.
The founders told TechStartups in an email that they only work with ethical suppliers like local family-run wool farms from around the globe, which source natural and high-quality yarns, and all the production is animal cruelty-free.
According to Meškauskaitė-Dobrajs, one of the founders, it is essential to not lose focus and the mission of the business in order to grow, especially in the fashion industry. “There isn’t a formula for success, however, I’d suggest never forgetting your main purpose,” she said.
“Plans are always changing, but you have to know why you are doing it. In fashion, like in any other business, you have to put a lot of effort into knowing your customers, attracting investors, and determining exactly how and where you want to grow. Most importantly, you have to be oriented towards your target audience and know where to find it.”
“The Knotty Ones” has been successfully growing its international distribution with global partners such as US lifestyle retail giant Anthropologie and Gwyneth Paltrow’s Goop. The brand has also been selling with famous American retailers such as Revolve and Free People. “The Knotty Ones” products are notably worn by international celebrities and influencers like Hilary Duff, Margaret Qualley, and the wife of Richard Gere, Alejandra Gere.
Since its first investment round in 2020, the knitwear brand has grown five-fold while remaining committed to its core values of sustainability, honoring Baltic knitwear traditions, and empowering women through job opportunities in rural areas of Lithuania.
Further expansion is planned
“The Knotty Ones” plans to use the €250K investment to expand into international markets, particularly into the United States, foremost focusing on responding to the needs of their foreign customers via wholesale and e-commerce.
“We are happy to have attracted Lithuanian investors in this round and are planning an international fundraiser going forward,” says Sandra Pangonytė, co-founder of the business. “Financial and strategic support we received from the female investors we engaged with is a confirmation we’re growing in the right direction – expanding our impact beyond the business. We are happy to have brought together a strong community of women — from knitters to opinion leaders, from the founders of the company to the ever-growing team and loyal customers. We now hope to drive all of us towards success.”