Why we need more female founders
The gender funding gap is staggering. Only 9% of venture capital goes to female-led companies and a mere 17% of startups have a female founder. Yet at a recent talk on funding female founders, Sharon Vosmek, CEO of Astia (a US VC firm), shared some remarkable statistics:
- Female led businesses generate higher revenues
- Startups with women on the team are less likely to fail
- 64% of VC backed exits had at least 1 female executive
- Teams with women outperform teams without, according to MIT research
There are also huge economic benefits with Deloitte predicting a potential £100 billion boost to the economy over the next 10 years from closing the gender funding gap.
Backing great founders, regardless of gender
At Forward Partners we love working with, and have funded some incredible female founders. Our most recent backed founders include Suzann from RoomLab, Rachel from Koru Kids (pictured above) and Daniela from Gravity Sketch.
"I knew Forward Partners would be great investors as they have such a strong reputation and have invested in so many superb founders. But they have actually exceeded my expectations so far. Their team has been so helpful on so many fronts - talent, PR, operations, growth - and consistently a total pleasure to work with/hang out with." Rachel, CEO Koru Kids
Of our investments 10% have female CEOs and 15% of our C-suites/founding teams are female. This is roughly equivalent to the industry average but we have no interest in being ‘industry average’. So we’re going to do something to solve it. We started with developing a greater understanding of the issue through our pipeline data.
We decided to start with the top of funnel because ultimately, ‘funds lose 100% of the deals they don’t see’. Therefore we have begun to track the proportion of female founders applying to Forward Partners so that we can work on ways to improve it.
Analysing Forward Partners’ dealflow
We used a database of male and female names to determine the gender of our applicants across our internal CRM.
The result was 22.36% of our applications across all funding stages were from women.
[Unfortunately using this process we were unable to track those that identify as gender non-binary or other. We recognise this is a problem and we will consider this as part of our ongoing commitment to gender diversity.]
So what can we do to improve it?
We’ve set our sights high. We’re aiming to increase the proportion of female founders applying to 30% in the next 2 months. This will be partly through outreach to female-focused organisations, female pitch/demo day events, using social media channels, and through our own personal networks.
As part of our commitment we will be holding a female founder office hours for pre-seed companies on Wednesday 4th July. You will have the opportunity for a face to face meeting with one of the investment team and to receive individual feedback on your business/idea in a friendly, non-judgemental environment. We’re hoping for this initiative to be a great success, of course, and looking to the future there are a number of further things we might implement: introducing quotas for Office Hours or indeed making female-founder office hours a regular fixture. Nothing is off the table.
At pre-seed we invest as early as a founder with an idea so if you know someone who’s been thinking of starting a business or has a great idea please forward this link: http://bit.ly/femaleofficehours
Please share this widely so that more women are aware of this resource.
Why Female Only Office Hours is So Important - Mark Suster
What Makes Your Team Smarter? More Women? - Woolley & Malone