By Maya Plentz
In 2016, only 7% of the partners in venture capital firms in the US were women, and just 1.9% of venture capital funding went to female founders. How can we change this landscape?
There was a little bit of progress in 2017, reported an article by Fortune magazine: “all-women teams received just $1.9 billion of the $85 billion total invested by venture capitalists last year, according to data from M&A, private equity, and VC database PitchBook. That’s equal to about 2.2% of 2017’s total venture capital invested in deep tech and digitally enabling startups. ”
“Meanwhile, all-male teams received about $66.9 billion—roughly 79%. (of the remaining 19%, 12% of funds were raised by mixed-gender teams, while 7% was raised by teams whose gender makeup PitchBook was unable to confirm.”
We all agree that the size of the gap is shocking, however, it is slightly better than 2016. For, and I quote: “In 2016, female founders raised just $1.4 billion—or 1.9% of total VC funding. In fact, with the exception of 2014, 2017 marks the largest percentage of total venture dollars that has gone to female founders since PitchBook started tracking the data in 2006.”
There is a lot to be done, and here I believe that it has to be two-pronged effort where private sector actors, together with public sector funding agencies, must make a concerted and directed effort to address these gaps.
As you all know, many private equity and venture capital funds tap into state pension funds and other public funds to generate their investment funds.
There must be some way to address these glaring disparities in funding women tech companies if the public funds in question demand that a fair share of the investment be made to women-founded and women-led tech startups. And by that I mean deep tech, biotech, nanotech, the life sciences, the social sciences, the digitalization of other sectors of the economy, the arts, commerce, trade, as well as digitally-enabled businesses where women often have deep expertise.
I am not here representing a company or single organisation, I am representing women who work in tech, and the digital economy. Women who want to create tech companies, run and scale real businesses, $100 million USD exits, not a side gig.
I see these ambitious and eager women all the time, at the accelerator MassChallenge where I am a mentor, in buses, in the streets, in seminars, in accelerators, in conferences, where most of the time 80% of the audience is male.
I see them trying to sell their ideas and MVPs, pitch, to a mostly male venture capital and seed investing audience, to tell their concepts just to be overlooked, interrupted, when not talked over by male colleagues and partners.
There is a cultural shift that has to happen in our societies.
After a year of hearing and reading horror stories about women being held back professionally by bullying, sexual harassment – and other forms of abuse of power – it is high-time that we calculate the costs for our economies of these women’s lost wages, investments, lost opportunities.
And, above all, the time, that most precious asset that founders have. The time that they have wasted dealing with an often hostile and almost always indifferent environment.
Please contact me via the form on this site if you would like to find out more about the studies I sourced for this policy statement.
Some reference links: