VC Ecosystem Becoming More Female But Progress is Slow
Venture capitalists are beginning to invest more heavily into woman founded companies. Compounding this trend, there are a number of women-run and women-focused VCs becoming more active in the market. Many industry experts expect these trends to continue as equality in funding becomes more prominent.
To add numbers for context, female-founded startups have raised over $20bn through the first 3 quarters of 2019. If the trend continues, 2019 would be the second-best year on record for funding to female-founded companies. Despite these promising facts, according to Crunchbase, female-founded companies have only accounted for roughly 13% of all capital invested in 2019 YTD. Further, woman-founded companies have only received 11% of all dollars that fall within larger round sizes of $100m or more.
Women run and led VC firms are starting to become more common, however progress in this area is slower than desired as well. As a still largely male dominated industry, only 11% of decision makers at VC firms with more than $25m under management are women. A new fund, Inspired Capital, will hope to make a dent in those statistics. Announced last week, Alexa von Tobel, who sold LearnVest to Northwestern Mutual for $375m, is teaming up with Penny Pritzker, the Secretary of Commerce in the Obama Administration, to raise $200m for the NYC based fund.
Driving increased awareness of these issues are organizations like AllRaise who have stated goals to double the number of female VC partners in 10 years, while increase the percentage of venture funding to female founders from 15% to 25% within the next 5 years. This type of bottoms-up change is powerful and will likely accelerate as we enter the new decade.
