VCs gendered assessments undermine women entrepreneurs

An analysis in Sweden of the conversations venture capitalists had about entrepreneurs applying for funding found that the VCs described men and women entrepreneurs very differently. The ways the VCs talked about the women entrepreneurs produced “stereotypical images of women as having qualities opposite to those considered important to being an entrepreneur, with VCs questioning their credibility, trustworthiness, experience, and knowledge.”

In contrast, when evaluating the male entrepreneurs, financiers “leaned on stereotypical beliefs about men that reinforced their entrepreneurial potential. Male entrepreneurs were commonly described as being assertive, innovative, competent, experienced, knowledgeable, and having established networks.”

The result: “Men were characterized as having entrepreneurial potential, while the entrepreneurial potential for women was diminished.” And men received more funding. On average, women entrepreneurs only received a quarter of the amount they asked for, while men received 52% of what they asked for. Women were also much more likely than were the men to have their application rejected altogether. 

For more on this study read, “We Recorded VCs’ Conversations and Analyzed How Differently They Talk About Female Entrepreneurs” in Harvard Business Review.  

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