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Gender IQ for Venture Capital

The difficulties of securing venture capital for female founded businesses.

Failure is not an option.

In 2020, UK venture capital firms invested £12bn into business across the nation, by far the largest total value of investment across the whole of Europe. The UK is the start-up capital of Europe, but not when it comes to women. At GoalShaper, we have experienced first-hand, how difficult it is for a female founded business to get investment. In fact, for every £1 of VC investment within the UK, female founded businesses get less than 1p.


Despite the obvious inequalities that exist, the past five decades have shown huge improvements for women in the workplace; from greater levels of higher education to greater levels of labour force participation. So, why is VC funding still not feeding through to women and why has the first female led VC fund in London, only just been formed? Bear in mind the context: this is an industry at the forefront of human innovation where boundaries are constantly being pushed and failure isn’t an option.

Has Venture Capital failed women?

83% of investment firms in the UK report having no women on their investment committees. Does this statistic shock you? It should! There has been much written, generally, about performance bias and how there is a tendency to provide more resources and opportunity to one gender over another. This happens in all areas of life but in technology and the venture capital, it is endemic.

Bias also appears in how entrepreneurs are questioned. Research from 2017 found that women are asked different questions than men when pitching to VCs. Across 180 entrepreneurs and 140 VCs at the TechCrunch competition, men were consistently asked more ‘promotion’ questions (highlighting upside and potential gains), while women were asked more ‘preventive’ questions (highlighting potential losses and risk mitigation). Entrepreneurs who addressed promotion questions raised at least six times more money than those asked the prevention questions.Harvard Business Review

Overcoming these barriers will require greater access to mentors, networks and business angels, and this is slowly improving thanks to female led investment bodies such as Two Magnolias.

What we’re left with is an investment world where white men are investing their capital into white male investment managers who are investing it into businesses founded by white men. This severe lack of diversity results in fantastic opportunities being missed, overlooked or discounted due to the biases of one sector of society making all of the decisions. As female founders we know that we ask different questions, make different challenges and are more open minded when it comes to decision making. We invest in sectors that we feel will have an impact on the world as well as delivering financial return. Maria, Two Magnolias

Our own experience has been a kaleidoscope of experiences. From pitching to a board of all white middle-aged men, to a refreshing change this week where we finally pitched to a woman. The contrast is dramatic and worth exploring.

In the first scenario we were invited to pitch to an all-male board along with a room full of investors. We were not allowed in the room to meet the investors and we were ushered out afterwards and sent home with a pat on the back. Compare this to the pitch we did this week to Two Magnolias where they asked up-front if they could invite their interns to the meeting to teach them about business building. We spent a long time ‘getting to know’ each other and building solid foundations for longstanding relationships.

Gender IQ was invented by our Founder, Tracey Carr, and taught at the highest levels of leadership by her for over 15 years. The main point for all of us to learn is that Gender IQ is on a scale; with the masculine skills, traits and abilities at one end of the scale and female skills, traits and abilities at the other end. All of us can sit anywhere on that scale. When Gender IQ is not present in business there is an overemphasis on masculine skills, traits and abilities. Nowhere can you see this more strongly than in technology and venture capital.

Has venture captital failed women? So far – yes. The job in front of us to widen the acceptable range of leadership styles so that all businesses and funds can thrive, not just those that look like the old paradigm.

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