Venture Capital's responsibility to women - Josh Loe

Venture Capital’s responsibility to women

84% of the funds do not have a woman in their investment team and only 4% of the funds have a woman member.

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This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process.

Opinions expressed by Entrepreneur contributors are their own.

If you are the founder of a startup and you are also a woman, this note interests you. Being a woman today is a great privilege and more so when culturally, socially and economically you have broken those role patterns marked by gender. That is to say, those that involve equality between men and women and that is that, although we live in the 21st century, there is a great gap on the subject that encompasses all cultures, societies and even industries. Venture Capital is not excluded from this problem.

In 2020, startups led by women received only 2.3% of venture capital funds, not only is it a short figure, but as a result of the pandemic, this fell 0.5% compared to 2019, whose percentage of global participation was of 2.8%, according to Crunchbase.

According to Mujeres Investing, 84% of the funds do not have a woman on their investment team and only 4% of the funds have a female partner. 82% of startups funded by the private equity industry do not have a female co-founder on their team. Returns on funds and companies are proven to increase as team diversity increases.

G2 Momentum Capital , an early stage VC fund, considers that the raising of capital should be equitable, that there are no differences between men or women but in “how good is the idea” “that the rider knows how to direct the horse” from a perspective of being human and not of whether he is a man or a woman. However, support for women from all perspectives is necessary to contribute to closing the gender gap.

When supporting venture capital projects led by women, it is twice as likely that they in turn will hire women, which significantly improves their employment outlook. A Venture Capital fund that supports women gives you the opportunity to be successful and to achieve these goals. “Startups with a founder employ 2.5 times more women, according to an analysis by Kauffman Fellows.”

This is accelerated when within the same VC funds a woman is among its partners, basically a series of chain events is generated, since a social contribution is generated. That is why every day initiatives are emerging in the ecosystem that work for women, either as an entrepreneur or an investor, such as AMEXCAP , who in 2018 created the committee of women investors, since in our country the female presence in the private equity industry is less than 1% or initiatives such as Women Investing, while taking into account the work of more than 40 years that has been carried out by the Mexican Association of Women Heads of Companies ( AMJJE ).

The venture capital ecosystem should consider increasing these percentages, since everyone wins in this model. The participation of women in the venture capital industry is increasing, more companies founded by talented and innovative women are financed and therefore twice as many women join the teams.

If you are a founder, consider that if you develop and lead a company that will impact millions of people, you are also working for the women who will join you in achieving your dream.

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