Why Is VC Funding for Women Stuck at 2% & how to change it

Throughout my career, I've been privileged to encounter awe-inspiring stories of women who not only went big but also embodied a distinct entrepreneurial spirit. These stories are not just tales of success; they are blueprints of resilience, adaptability, and unwavering determination.

This is the 28th lesson, and today, we dive into a pressing issue: Why are only 2% of venture capital investments going to female founders? And what can we do to change this?

It’s no secret that women-led ventures face an uphill battle when it comes to securing funding. Despite the rising number of female entrepreneurs, the venture capital industry remains largely male-dominated, with a mere 2% of the industry’s funding going to female founders. Frankly, fuck them. It’s time to call out this disparity and highlight the incredible companies that are run by women, who deserve far more than they’re getting.

Statistics:

• In 2022, only 2.3% of venture capital funding went to female founders in the U.S.
• In Europe, the figure was slightly better but still dismal, with 1.8% of VC funding going to women-led startups.
• When it comes to female investors, the numbers are equally disappointing. Only 12% of decision-makers in venture capital are women, which explains why female founders struggle to find investors who understand their vision.

The Main Reason: Investors Want to Invest in Like-Minded People

The unfortunate truth is that people tend to invest in those they see as similar to themselves. So, when you walk into a pitching round dominated by men, you're already at a disadvantage. Are you like them? No, you’re a woman—bam, one tick off.

• Not a man: One point off.
• Not in their industry: Another point off. As someone coming from marketing, an industry often seen as a cost center rather than a driver of growth, you’re already fighting an uphill battle.
• Not their age: If you’re in your mid-to-late 30s, that’s another point off. They assume you should be focusing on starting a family, not a company.

Look at Me:

I’m not a man—one point off. I’m not in their industry—one point off, since marketing is often undervalued. I’m not their age—one more point off, because apparently, I should be thinking about family instead of my business.

But guess what? Hey dude! I can do it! I raised 150K so far, and building my plan to raise more!

Before you even start pitching, you have to crawl through so much extra bullshit. They may not say it outright, but it’s there. It’s unjust, and it’s exhausting, but it’s the reality for many women entrepreneurs.

It’s time to push for more women in venture capital and demand that our stories be valued for what they are—testaments to resilience, vision, and the future of entrepreneurship.

Whats your take on this? Drop your comments below!

This post is part of “a Journey of 52 Weeks: Lessons I Learned by Becoming an Entrepreneur.” It’s a reflection on my journey, a push for fellow founders to celebrate their milestones, and a call for more women to dive into entrepreneurship.