A new report published by Antler spoke to 43 women founders based in the UK, Germany, the Netherlands, Sweden, and Norway about their recent experiences when interacting with angel and VC investors.
Antler's research revealed that every founder said that the European investor ecosystem is gender biased, with 39 women founders indicating that they believe investors are not doing enough to support women.
Even Antler’s report published in June this year revealed that despite the challenges Europe is facing, the ecosystem is as strong as it was before, however, gender inequalities exist among the tech funders. And we have to admit, unfortunately, it’s not something new.
When it comes to the amount of funding that goes to startups with female-led teams, the numbers are unfortunately very low.
According to an International Data Corporation European Women in VC report, only 1.8 percent of European VC funding goes to startups that are led by women.
The reason for this lies in the fact that women are treated differently by VCs, while more than two-thirds of women founders (72 percent) believe they have been asked questions by angel and VC investors that male founders wouldn’t have asked during pitch meetings.
Which questions exactly? According to the research, women founders have been asked:
- What is it like being 30 and not having children?
- Are you planning to have a major life event soon?
- How will you handle being pregnant and running a business?
- Do you think you’ll lose interest in the business once you’ve had your baby?
- Do you think you need a co-founder with a technical background?
- Can you be more aggressive with your valuation like other founders?
- Do you think you will end up being another Elizabeth Holmes?
- Two women building a tech product — are you sure you’re the right people to do this?
- Can you send me your qualifications?
Moreover, two-thirds (64 percent) of women founders believe that their gender is the reason why it is much harder to raise investment, while one-third (32 percent) stated that investors were unconsciously biased during pitch meetings.
“We want to shine a light on the experiences women live every day as entrepreneurs and founders. Whilst there are many examples of inclusive VCs, all too often women have to face gender bias when raising funding.
"Our hope is that this study will encourage VCs to recognise the scale of the challenge and continue to drive positive change in the industry.” - Livia Moore, Associate Partner at Antler
Make it better
Despite the fact that there are huge differences between men and women founders and the way investors approach them and, we might say, treat them, there are also those who provide a positive example.
Antler's research found that 72 percent of the founders who participated in the study noted that investors who have backed them have been women.
They shared some examples of best practices, stating that women should be recognised as competent partners rather than ‘female founders’, that children can fit into the startup journey, and that it's important to hire more female partners and investment managers.
When asked about the challenges and initiatives that could drive positive change, almost all (95 percent) participants think that the first step should be hiring more women. Additional suggestions about the changes VC firms could make include:
- Encourage alternatives to the ‘warm introductions’ route
- Publicly disclose stats around diversity in a VC firm’s portfolio
- Include parental leave policies in investment terms
- Profile female founders and champion success stories through social channels
“Diversity is a critical factor lacking in European venture capital. In 2022, only 1.8 percent went to female founders, and 12 percent to mixed founders, revealing blind spots in the ecosystem." - Sarah Finegan, Director at Antler
Antler's methodology is based on research conducted in October 2023 based on a sample of 43 women founders in Antler’s European portfolio whose startups have successfully raised pre-seed or seed funding rounds since 2021.
Lead image via Lexica