Women VCs Invest in Up to 2x More Female Founders

Summary of Study

Bottom Line: Female venture capital (VC) partners invest twice as much as their male counterparts in female founding teams. Therefore, female venture capitalists are significantly increasing the chance that women-led startups raise money and get a shot at building a category-defining company. The reason for this increased investment is likely due to women having personal experiences that male investors do not.

In recent years (2001 to 2018), over 80% of all venture dollars were raised by all-male founding teams. In fact, there is not a single stage of VC fundraising where male founders closed less than 80% of the rounds. The $147 billion raised in 2018 by all-male founding teams exceeds the amount of VC dollars put into female founding teams for the last 19 years combined.

Despite females' funding disadvantage, when given access to capital, startups with women founders and women in the C-suite go on to raise millions more than their all-male counterparts when measured head-to-head.

Female VC partners lead noticeably more early rounds in female founding teams than their male VC counterparts. At the seed stage, one-third of women partners’ investments are in female founding teams, compared to only 16% of male VC leads. Thus, women VCs invest in twice as many female-founded startups as their male counterparts.

There is a large gap between the investing of male and female VC partners in technology startups (Computer Science/Healthcare): Women VCs back female tech founders 63% more often than male VCs do. And women VCs back female-founded consumer companies significantly more than their male VC partners (61.8% versus 24.3%). 

This dramatic difference in consumer startup funding is likely supported by the fact that women make the vast majority of U.S. consumer spending decisions, particularly in terms of food, fitness, beauty, and apparel.

These findings, which are consistent with the broader research, suggest that the 15% of venture capital partners who are women are responsible for giving women-led companies a chance early in the startup journey. 

Read the full study HERE

Feature Charticle

Female VC Partners Consistently Back More Female Founders Across Sectors 

Kauffman Fellows

Findings:

  • Female venture capital (VC) partners invest twice as much as their male counterparts in female founding teams.

  • Women VCs back female tech founders 63% more often than male VCs do. And women VCs back female-founded consumer companies significantly more than their male VC partners. 

  • Female venture capitalists are significantly increasing the chance that a women-led startup raises money and gets a shot at building a category-defining company.

Read the full study HERE