SOSV is Top VC for Funding Female Founders…Now What?

 In Blog, The SOSV Story, Women in Business

(a.k.a. Lessons From Spiderman)

TechCrunch released their first comprehensive Women In Venture Report, and SOSV ranked #1 in VC seed funding for female-founded startups.

The report is showing we have the highest percentage of female-founded startups in our portfolio compared to other top venture capital firms. According to our own internal analysis, across all teams from our four main accelerators – HAX, IndieBio, Chinaccelerator and Food-X – 104 of the 228 teams had at least one female founder (45.6%).

SOSV Portfolio Female Founder

This is great news. It’s a welcome sign to see an increasingly balanced ratio of male and female-founded companies getting VC funding, especially from SOSV. It paves the way for business to become more balanced overall.

But it needs to be better.

Numerous studies have proven that businesses with at least one female founder outperform their all-male founder counterparts. But despite this, there are still hurdles to overcome, evidenced in gaps in follow-on financing rates that are attributed to structural gender bias, to the confidence gap between men and women…the list goes on. More needs to be done.

As the ever-wise Spiderman says, with great power comes great responsibility. As a leader in identifying and growing female-led businesses, SOSV has decided to dig deeper to understand the experience of female founders who have participated in our accelerators. Could participating in an accelerator potentially narrow the confidence gap between female and male founders, setting female-led businesses up for greater success?  

Of course this raises more questions once companies graduate. Post-accelerator, is the female founder split still relevant in financing? How many of these female founders are landing a Series A, or even getting into the same room as investors as often as men are? If they are getting less investment after they graduate from our accelerators, why is that?

These are important questions that we’re exploring in depth, and we are committed to providing answers in the near (and far) future as our companies grow.

We’ve already talked to some female founders about their experience in business, and some have identified challenges like being ignored in the tech community and difficulty finding mentorship:

“You feel very much like an island as a young female entrepreneur,” said Rhona Togher, CEO of Restored Hearing. “I know a lot of male founders who are in their late twenties running generic tech startups with ten people on their board. I have none. Most advisors are older men who see themselves in these younger guys, but they don’t see themselves in me.”

Maybe women could use some more encouragement.

“Don’t get pushed around so much. Show confidence,” says Jemma Redmond, CEO of Ouro_botics.

These individual stories have been informative, and now are we aiming to provide a more in-depth analysis of the accelerator experience as a female founder.

Yes, there is still a long way to go before tech businesses are more gender-balanced overall. And we need to find the mechanisms to make things better, faster. With female founders on the rise, it is fitting to be optimistic about what the future of venture capital holds, but we cannot become complacent.

Again, we return to the wisdom of Spiderman…fitting words for any of us looking to disrupt the face of venture capital, technology, and everyday life:

Not everyone is meant to make a difference. But for [all of us at SOSV], the choice to lead an ordinary life is no longer an option.

Watch this space.

Recommended Posts
Comments
  • Sean O'Sullivan
    Reply

    Hey Kayla,
    Thanks for this write-up! Yeah, it’s completely awesome to see that SOSV has selected a higher proportion of female-powered founder teams than any other VC, according to the data that Techcrunch published, which shows SOSV with 34% of all of our rounds going to teams with female founders.

    It’s even more encouraging to us that Techcrunch’s data isn’t complete, with your indication that our internal data shows us funding 45.6% of teams with female founders.

    It’s natural there are some differences in the data as well. I suppose some of the difference between our selection of accelerator companies, at 46% with female founders, to the Techcrunch data, at 34%, comes from multiple reasons:
    our internal data includes a lot more teams, and rounds, than Techcrunch shows… we’ve made roughly 400 rounds of investment since 2010 vs. the 216 that are included in the Techcrunch data. Techcrunch may not have this data due to preferences of some of the companies that we’ve backed to remain confidential, etc.
    we have investments that we’ve made in teams that have not gone through our accelerators, which TechCrunch includes, but you’re not including in your analysis of SOSV-sourced investments. If these investments are being sourced by other means, then apparently this means there are less females on those teams,
    it’s possible that female founder teams are getting more prevalent with time, and that the latest data just hasn’t made it to Techcrunch… which could explain why we’re showing higher support for female-powered founder teams than even what Techcrunch reports us at.

    Finally, one of the issues that TechCrunch and others are speaking about is female venture partners. The industry average is to have 7% female venture partners (1 out of 14)! Clearly, with the number of female founders coming into the industry now, at least through SOSV companies, that situation will be changing. At SOSV, we have 7 investment partners, and none of them are yet female (not counting cross-dressers). We do have several up-and-coming females in our accelerator and program director staff, and in many other leadership positions across the organization, and we will continue to seek successful female partners who meet the criteria of having started and run one or more successful startups, which is the bar we look for all our investment partners to have crossed, ideally.

    As you say, more to do! Thanks.

Leave a Comment