It’s International Women’s Day again, and your LinkedIn feed is likely filled with VCs celebrating the women in their portfolio. We decided not to do that this year, and here’s why: we think there is a more important message to share.
We think the women in our LP base, company and portfolio companies are all brilliant, and we celebrate them every day. But, despite enormous gains in many areas of gender recognition and equality, the levels of female representation in the early-stage tech ecosystem remain stubbornly low - 84% of fund GPs are male, and 82% of VC dollars goes to all-male founding teams (Atomico).
The reasons for this are multitudinous and complex - start-up/VC life is often not very family-friendly, women are underrepresented in STEM and finance, people tend to hire/invest in people like them, the characteristics generally associated with success in entrepreneurship and finance have a lot of overlap with traditionally male behaviours, the list goes on.
So many VCs and founders congratulate themselves if they have any women in senior positions at all. We don’t support this. We think it is lazy, and insufficient. You need to be the change that you want to see in the world.
Change requires intentional action. We think that if you run a VC fund, or if you are setting up a company, you are responsible for making sure it represents the world it is trying to support. This might mean trying a bit harder to go outside your network when you are hiring or sourcing deal flow. But if you actually believe in the power of diversity to improve decision making and reduce risk and increase performance (McKinsey, European Women in VC), it’s obviously a worthwhile investment. If you layer on your responsibility to use whatever platform or power you have to make our society more equal and representative, it becomes a moral imperative.
As a female-led VC fund, we find that we are often given a platform to talk about gender diversity, which we appreciate. We are incredibly proud that more than 40% of our portfolio companies have at least one female founder, around twice that of the industry average, even though we only invest in hard scientific innovation so most of our founders have a technical background. How do we do that?
We think it’s because we are out there every day, with a majority female team of excellent scientists making investment decisions, and that creates a positive feedback loop. We have a broader view on what awesome looks like, and we try to be approachable and respectful with founders. We will always give a female or diverse founders the benefit of the doubt, and that goes a long way. We work very hard to make thoughtful, collaborative decisions, and that is appreciated by the hardworking, thoughtful, collaborative founders.
We know how hard it is to come across as a confident, badass pioneer when oftentimes, you are filled with doubt and insecurity, and perhaps distracted by some drama at home that you are trying to fix on the side. We know what it is like to have a manager or investor look at you, trying to calculate the probability that you are going to disappear on maternity leave. We know what it is like to have to go out there and smash it when you are having a day that really should be spent curled up in bed. We know what it feels like to see male colleagues promoted ahead of you, male founders invested in instead of you, male fund managers supported - when you think what you are doing is just as good, perhaps even better. We see you and we salute you.
On this International Women’s Day we say to everyone - please stop the self-congratulatory posts, the platitudes, the tokenism. Please just take action to make your team and your portfolio more diverse and more representative of the community it is serving, at all levels. There is a positive feedback loop - you will see the benefits in your company culture, the quality of your decision making, your team retention, your company metrics. We all have a long way to go to consciously counter our internal biases, but we must try. The prize is so great - a thriving climatetech ecosystem where women and other minorities are represented, respected and genuinely free to pursue their dreams without fear and without limitation. Let’s go.
Thanks to European Women in VC for this explainer from their 2023 report 'Achieving Superior Returns with Gender Diversity in European Venture Capital Firms'
Thanks to the BVCA for this checklist of best practices for VCs, private equity and institutional investors, taken from their 2021 report "Guidance and Best Practice Examples for VCs, Private Equity and Institutional Investors with regard to Diversity & Female Entrepreneurship"
