Fix your funnel: 7 steps to attract more underrepresented founders

At ZCC, we’re really proud to have a portfolio where around half the companies have at least one female founder, and that tracks well with other forms of underrepresentation. But we know that’s not typical of the wider VC world, and we often have conversations with other fund managers who genuinely want to back more underrepresented founders, but find their deal flow looks stubbornly the same. 

So we thought we’d share some thoughts about how to fix one specific part of that problem: the very top of the funnel. Not IC decisions, or term sheets, or fixing unconscious bias overnight. Just who feels encouraged (or discouraged) to approach you in the first place.

What do we mean by ‘increasing diversity’?

When we talk about underrepresented founders, we’re referring to people who are underrepresented in venture funding relative to their presence in the population, including (but not limited to) women, ethnic minorities, state educated, LGBTQ+, disabled and neurodiverse founders, and those outside traditional tech or geographic hubs.

In the UK, 2p of every £1 of VC funding goes to all-female founding teams. Mixed-gender teams do better, but still only receive 27% of the total (IIW Code Report, 2025). 48% of all private funding in the UK goes to companies based in London (UK Private Capital Report on Investment Activity, 2024). In the last ten years, 0.24% of UK VC funding went to black founders (Extend Ventures). Similar gaps exist across all ethnicities, socio-economic backgrounds and disability groups. Importantly, supporting one dimension of diversity tends to improve others, for example funds that actively back women founders tend to see more ethnic diversity, broader sector coverage, and more first-time founders in their pipeline. You don’t necessarily need a separate strategy for every axis.

Why the top of your funnel looks a bit samey 

Most VCs don’t intend to exclude anyone, but the path to venture funding can be inherently exclusive. VCs rightly value quality signals including warm intros from existing networks and pattern recognition informed by past winners, and founders are drawn to signs that ‘people like us succeed here’. 

Over time, this compounds. Founders who don’t see themselves reflected in your website, your team, or your portfolio quietly (maybe subconsciously) self-select out, long before you ever see the pitch. If your funnel isn’t diverse, it’s probably not because diverse founders don’t exist. It’s because they don’t think you’re looking for them.

We’re not suggesting you need to lower your bar. You just need to change how you describe it so you’re not putting off potentially qualified people at the first step. 

So what are some of the things that VCs do (unintentionally) that put founders off? A few patterns come up repeatedly in founder feedback:

• “Exceptionalism” language: Phrases like ‘we back extraordinary founders’, ‘once-in-a-generation talent’ or ‘outliers only’ may sound fine - of course VCs are looking for great, ambitious founders - but this can discourage people who’ve felt their whole lives like they don’t fit in and aren’t good enough because they aren’t the same as more successful people in some way. We’re not suggesting you need to lower your bar. You just need to change how you describe it so you’re not putting off potentially qualified people at the first step. 

• Closed or unclear access: No visible email, no open office hours, no application form, no guidance on how to approach. That’s adding hurdles for anyone outside traditional VC networks.

• Homogeneous teams and panels: If every visible decision-maker in your team looks and sounds the same, and your portfolio is also extension of this, founders infer (often correctly) that perspectives and qualities that match will be preferred. 

• Narrow sourcing channels: Relying on the same accelerators, universities, angels and repeat founders will reliably produce… similar founders.

How to clearly signal that you welcome underrepresented founders

1. Use inclusive, specific language

Move away from vague superlatives and towards facts: What stages do you actually invest at? What does “ready” look like? What kinds of founders and backgrounds have you backed before, or want to back more of? Inclusive language isn’t about being soft - it’s about being clear.

2. Be visibly accessible

At minimum:

• A clear contact route on your website

• An open application form (even if not your primary sourcing channel)

• Published office hours or founder sessions

Access doesn’t replace curation, it broadens it.

3. Make your commitments visible

Being a signatory to the Investing in Women Code, or certified by Diversity VC, isn’t a token badge. It shows that you’re measuring your behaviour, you’re willing to be accountable, and you’ve done the work you need to do internally to be able to prioritise diverse founders. 

4. Diversify where you source

This doesn’t require a massive programme - the goal isn’t volume but range. Small shifts help, for example: 

• Partnerships with universities beyond the usual handful. Many universities also have groups supporting specific minority groups (e.g. women in engineering) that you could approach - perhaps you can give feedback on their annual competition, or invite them to an open session to learn more about your fund. 

• You could build relationships with community-led accelerators.

• Make sure one of your team goes to open demo days or founder events without invite-only filters. 

• Check out the many groups working to connect funders with diverse founders - from communities like Climate Mosaic to deal-sharing services like The Table and Social Mobility Ventures.

The Female Founder and Funder gathering at the 2025 London Climate Action Week

5. Intentionally build balance into your visible moments

Panels, events, blog posts, podcasts, website photos - these all shape perception. If founders never see people like them in your public-facing output, they will draw conclusions. Every time you are talking or sharing in a public forum, it is an opportunity to talk about how you value diversity, or how your fund welcomes applications from underrepresented groups. 

6. Offer support to the top of the funnel

If your fund is large enough to put on specific programmes you could target these to diverse founders. Some funds provide pitch bursaries, MVP or customer discovery support, and/or pre-investment coaching or feedback sessions. This helps founders cross the invisible thresholds that many assume are universal.

7. Bake DEI into how you operate

The strongest signals are structural: track who enters your funnel and how, set internal goals around sourcing diversity and secure senior ownership of inclusion - you could also consider linking senior compensation with achieving diversity targets. Actively working to increase the proportion of women and people from ethnic minority backgrounds making decisions at all stages of your deal flow funnel will strengthen these decisions, as different life experiences lead to different questions and evaluation of risk. VCs with at least one female partner are 2.3x more likely to invest in female founders (Founders Forum Group, 2025).

One final thought: This post deliberately assumes that the later stages of your funnel are fair. That may or may not always be true — and it’s a conversation worth having. 

Even with perfect IC processes, you can’t invest in the founders you never meet.

Widening the top of the funnel isn’t about quotas, PR, or lowering standards. It’s about removing unnecessary friction, sending clearer signals, and recognising that ‘who shows up’ is not neutral by default. If we want better outcomes, we have to start earlier.

Resources & Partners

Resources (with the specific reports which informed the suggestions in this post):

• The Investing in Women Code (IiWC): A commitment to support female entrepreneurship (2025 annual report)

• Diversity VC: Guidance on D&I best practices in Venture Capital - in particular check out their excellent Founder Engagement Toolkit. Offer a certification scheme for VCs. 

• UK Private Capital (formerly BVCA) has a Diversity and Inclusion portal with research and guidelines, and they host many events with the goal of improving diversity. 

• The 2021 report "Guidance and Best Practice Examples for VCs, Private Equity and Institutional Investors with regard to Diversity & Female Entrepreneurship" (the “Rose Review”)

• European Women in VC: A membership community of senior female venture capital investors, with events and many reports including this 2023 one on female inclusion in VC. 

• Level 20: Dedicated to improving gender diversity in the European private equity industry.

• Extend Ventures: Business, research and financial experts using the power of big data and machine learning to diversify access to finance. Diversity beyond Gender report

Investors with a specific thesis built around inclusion:

• The Table (UK-centric): Deal sharing network for female founders in cleantech.  

• Auxxo Female Catalyst Fund (Germany): Female founders, with focus on sustainability. 

• Ada Ventures (UK): Investing at preseed in overlooked founders and markets, with a strong climate vertical.

• Social Mobility Capital: Investing in founders from a state school background (UK).

• Bethnal Green Ventures (UK): Accelerator and fund for “tech for good” with strong framework for social inclusion in founders. 

• Unconventional Ventures: Unlocking the potential of diverse founders (Nordics-centric but do invest across Europe) 

• Astia Angels (international, US-centric) & Alma Angels (UK & Europe): Angel groups with focus on female founders.

• Sie Ventures: Accelerator and fund for female founders. 

• Black seed (UK): empowering black founders.

• Startup Discover School (UK): Enabling an inclusive Just Transition by empowering founders with access to funding, resources and expertise for a better, fairer world.

Communities

• Climate Mosaic: Community-run organisation connecting capital to climate solutions with an inclusive lens, also published “The Other Climate Gap” report into underrepresentation in climate venture. 

• Female Founders and Funders: follow Sophie Purdom and Ramsay Siegel for events at a Climate Week near you. 

• Women in Cleantech and Sustainability (US-centric)

• WE-RISE: An EU-funded initiative specifically for underrepresented female entrepreneurs in GreenTech, AgriTech, and ClimateTech.