Since I’ve started working in the entrepreneurship space, women founders have slowly but surely started breaking into the tech space. While it’s not nearly equivalent to the number of men, the number of women who are co-founding or founding companies has nearly doubled from 9.5 percent of startups in 2009 to 18 percent in 2014.
But what hasn’t increased at the same time are the number of women investors. You may ask yourself why that should matter – don’t all investors just want to make the best deals? Does the female/male ratio really matter?
The logical answer is no, it shouldn’t matter – but research shows that it does. Gender of the investor plays a major role not only in whether or not the female company gets funded, but also in the success of that company.
Last year, noted entrepreneur Sukhinder Singh Cassidy conducted a fascinating crowdsourced survey of 100 female tech entrepreneurs. Her results showed that women investors had written 30 percent of the respondents’ first checks, even though they make up a much smaller percentage of the total investor community.
And it doesn’t stop at initially receiving funding. Another study by Sahil Raina found that “with startups financed by all-male VCs, there is a whopping 25 percentage-point difference in the exits of female-led and male-led startups. Yet when startups are financed by VCs with female partners, that difference disappears. There is no meaningful difference in the success rates of female- and male-led startups when they’re financed by VCs with women partners.”
Meaning: female-led VCs can better help evaluate and advise these female-led companies, which leads to more successful exits.
There are definitely female investors making an impact. This list of 20 Venture Capital Firms with Leading Women VCs and the Top 10 Most Active Women Angel Investors in 2016 at least shows the progress that is being made.
But the fact is, it’s hard to find professional female investors nationwide. Recently, JumpStart held an event called “The Female Founders’ Guide To Raising Capital.” It was meant to bring together female entrepreneurs and different types of capital resources, including venture capitalists, to discuss the state of funding for women entrepreneurs. In order to have a balanced panel, we wanted both male and female investors represented to hear their different perspectives. But it took us more than a month to find a female investor for the panel (thanks Michelle Murcia from West Capital Advisors). It was a jarring reminder to my team that there is still much work to be done in balancing the gender scales in the investing space.
This is where creative thinking comes into play. I have been very impressed with how Female Funders, a program designed to encourage more women to become angel investors, has tried to break down the barriers for women to enter the investing world. We need more creative concepts like this one to help us move closer to a more equalized investor field.
Just like the STEM industries, it’s time for women to lean into investing to help support the women who are bringing new technologies and ideas to market. If we want to see more women succeeding as entrepreneurs, women need to be at both sides of the table.
This blog originally appeared on HuffingtonPost.com on September 8, 2016.