Pando

Female founder raising venture capital? Your odds are even worse than I thought

By Sarah Lacy , written on February 17, 2016

From The Equality Desk

For the last week, I’ve been having an at times depressing and at other times fascinating conversation about women in tech.

It was ignited by this article, and this follow up. My central question: If the rate of dual career households among power couples in tech is some 50% lower than the national average, is that part of what keeps women from getting funded and hired for the most senior positions?

There was one stat I tossed in the story that I’ve seen in most academic studies: That 7% of all venture backed companies have a female founder.

Actually, the latest Diana Project study shows worse news. While VCs funding of startups with a female executive anywhere on the team are up from 9% in 2011 to 18% in 2013, the funding of companies where women are CEOs is a sad 2.7%. Companies with a female CEO have raised just 3% of the dollars as well. And these companies were more likely older and larger, getting later stage funding not “I’ve got a good gut feeling about this entrepreneur” type of seed funding.

It all goes to that enormous fluidity of the term “founder.” VCs may want to dress up their diversity stats by talking about the firms they found with women “on the team.” But women CEOs have far less support.

This isn’t because women aren’t entrepreneurial: More than 36% of all small businesses in the US are female-owned.

The entire study is available here.

To my central point of my original story the study also says this:

Venture capital firms with women partners are twice as likely to invest in companies with a woman on the management team (34% of firms with a woman partner versus 13% of firms without a woman partner). Venture capital firms with women partners are three times more likely to invest in companies with women CEOs (58% of firms with women partners versus 15% of firms without women partners.) 


Given that, it’s good news that First Round Capital just hired Birchbox co-founder Hayley Barna as its first female partner yesterday.