It’s 2017, and women still aren’t being funded equally

Broadly, the venture capital industry is thriving. But
still, too often, women seeking funding are left out
of the boom because of hidden biases,
sexism and a general unawareness. Because of this — and recent
reports of incredibly low-brow behavior among high-profile
investors — it is more important than ever to understand where
women founders stand when fundraising.

Since 2015, Crunchbase has reported on gender diversity in
venture capital. And, once again, the story for women looking
to be funded remains stubbornly predictable. Here’s what the
numbers tell us.

Distribution of women founders

Companies with at least one female founder grew from 9 percent
in 2009 to 17 percent since 2012 — a stat that has not changed for five years.

Of the 17 percent of startups with at least one female founder,
one-third are made up of teams that have only female founders.
Another one-third are teams with two co-founders that include
one male and one female. The last third represent teams that
have 3+ co-founders with at least one female founder.
Two-thirds of these startups, therefore, represent majority or
equal female and male-founder representation.

Funding in women-founded startups

For the first two quarters in 2017, startups with a female
founder raised $332 million in seed investment, or around 15
percent of all seed funding dollars. Approximately $6.5 billion
has been invested in female-founded companies, representing
more than 11 percent of all dollars invested in the first two
quarters of 2017.

VC lacks women investors, possibly impacting ability to raise

On the investing side, only 7 percent of senior investing
partners at the top 100 venture firms are women. Female
founders face a greater challenge than male founders when
fundraising, as they are required to break into male
, which predominate at most investment firms.

For the first time in our reporting on the funding gap, we
looked at seed and early-stage funding since 2010 to see if
there is a difference in fundraising for female versus
male-only teams. Funding at this stage is risky, with the
investor focusing on the founding team and the idea.

Seed averages

As the chart shows, there is a persistent gap between what
male-only teams can raise, and what female-only teams can
raise. Teams with founders that are both men and women land in
the middle, a somewhat new trend that has become more
pronounced since 2015.

At the seed stage, we reviewed 2,400 rounds for female-only
founding teams and 37,000 rounds for male-only founding teams.
Since 2010, for seed-stage funding, women-only teams have
raised on average $82 for every $100 a male founded team

Early-stage venture averages

For early-stage venture, we reviewed more than 1,000 rounds for
female-only founding teams and 22,000 rounds for male-only
founding teams. For early-stage venture rounds, female founders
fare worse than the seed stage, as women-only founding teams
raise on average $77 for every $100 a male-only founded team

Notably, the gap of funding between women to men wasn’t always
so large. In 2014, women raised $89 for every $100 a man
raised. But over the past three years, the ratio has continued
to drop, and it’s not yet clear whether that pattern will

Backing founders

Because so many investors and founders are men, women are often
not related to in the funding process. This lack of familiarity
typically means reduced funding for women and a host of other

As one recent study pointed out, even the way investors frame
questions to women can impact funding. According to
the Harvard Business Review, female founders are
often asked “prevention-oriented” questions focused on safety,
responsibility, security and vigilance. Male founders, on the
other hand, are often asked “promotion-oriented” questions
focused on hopes, achievement, advancement and ideals.

The result of how these questions are asked between the
genders? Women ended up with less funding.

This phenomenon is not just limited to investors in the United
States. HBR also reviewed 125 pitches made in
Sweden, 26 of which were made by female-founded companies. In
the analysis, HBR found very different assessments of female
versus male founders:

“The financiers rhetorically produce stereotypical images of
women as having qualities opposite to those considered
important to being an entrepreneur, with VCs questioning their
credibility, trustworthiness, experience, and knowledge.”

Due to this line of questioning, women were only awarded 25
percent of their funding requests. Meanwhile, men walked away
with more than 50 percent of their funding requests.

With these studies and data in hand, it is time to revisit the
“guy in the hoodie” stereotype and recognize entrepreneurship
comes in many forms.

Thanks to Matt
 for conceptualizing the fundraising gap


  • Companies without founders are excluded from this analysis.
  • Seed/angel includes financings that are classified as a
    seed or angel, including accelerator fundings and equity
    crowdfunding below $5 million.
  • Early-stage venture includes financings that are classified
    as a Series A or B, venture rounds without a designated series
    that are below $15 million and equity crowdfunding above $5

Image: Li-Anne Dias

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