A coworking space and social club for women and marginalized genders is closing its doors Friday — and its founder says the organization suffered from investor reluctance to loan to women-owned businesses.
“It is with genuine heartbreak that we are informing you that The Wave is closing on January 31,” Joanna Smith, the organization’s founder, wrote in a statement published online last week.
The Wave opened in 2019 in the Commercial Club building downtown, with office and meeting space, on-site child care, and professional and personal services such as legal and accounting consultation and beauty and grooming services.
In its last months, The Wave "had our best numbers ever,” Smith said in an interview. “We made$ 37,000 last month alone. We were growing 20% a month. But we just didn’t have enough capital to keep it going. It isn’t that it wasn’t a viable business model; we just didn’t have a long enough runway, enough access to capital.”
It’s a familiar narrative for women who start businesses, she added.
“Women in Utah have very little access to capital,” she said. “Thirty percent of small business loans are given to women-owned businesses even though we start 55% of [those] businesses.”
In her statement online, she explained that The Wave had found itself short on financial support.
“We always knew it was a risk and our entire team was committed to its success but as with many start up small businesses we have run out of funding and capital,” Smith wrote. “Despite our best efforts [we] have not secured investors or further partners. ... Without that additional investment we are unable to keep our doors open.”
The Wave had a setback last year when it was targeted by an elaborate hoax, in which a fraudster allegedly manufactured correspondence enlisting it to host a fundraising dinner for then-presidential candidate Kamala Harris. Tickets to the event already had been sold when the Harris campaign informed The Wave it had arranged no such event.
“We did not recoup one penny,” Smith said. “We knew we had a 13- to 15-month runway when we opened. When that happened, we knew that it had shortened our runway to 10 months. We lost a lot of momentum. Up until that point, we were getting 30 members a month."
The Wave is selling its furnishings for sale at a discount, Smith said. “I’m going personally bankrupt over it,” she said. “But I don’t regret trying.”