What AI-powered insights reveal about the voice of women founders
What are the barriers women face when it comes to raising capital?
LEARN WHAT A.I. AND HALF A MILLION ONLINE DISCUSSIONS REVEAL ABOUT WHAT WOMEN FOUNDERS SAY ABOUT THE PROCESS OF RAISING CAPITAL, AND HOW INVESTORS EVALUATE THEM, WHEN NO ONE IS ASKING. CLICK BELOW TO DOWNLOAD:
Despite growing almost five times the national average (58% versus 12%), female founders receive only 2.3% of venture capital dollars invested in the United States. Within the women segment, women of color represent America’s fastest-growing entrepreneurial segment with the number of Latina-owned firms growing 172% and black women at 164% in the last decade, that is over 14 times the national average growth rate. However, multicultural women secure less than 1% of total VC funding, and investors often don’t even recognize there is a problem.
To help understand and close these gaps, we at Culturintel teamed up with researchers at the Harvard Kennedy School’s Women and Public Policy Program to conduct a never-done-before study to understand the specific barriers women face raising capital, using A.I., and leading big data tools to mine insights from the unsolicited digital discussions of women and investors respectively.
For the first time ever, insights were mined by gender and ethnicity, to better understand the factors impacting fast-growing populations like Hispanic and Black women. Findings were drawn from a total of 527,709 digital discussions analyzed, making it the largest analysis on this topic to report insights at scale by gender and by ethnicity.
Credit: A collaboration between Culturintel and researchers at the Harvard Kennedy School’s Women and Public Policy Program. The team included globally recognized leaders in gender equity, like Harvard Professor and author, Iris Bohnet, Siri Chilazi, Anisha Asundi, and Culturintel’s Co-Founder and CEO Lili Gil Valletta and Cultural Intelligence® head strategist Caroline Brethenoux.
WHERE DOES OUR DATA COMES FROM?
WHY THIS MATTERS
While women-owned businesses have grown almost five times the national average at
Female startup founders receive only
of venture capital dollars invested in the United States,
while mixed-gender founding teams with at least one woman receive another 10.4%. The picture is even more concerning for Latina and black female founders, who - despite their impressive growth rate of 163% over the last decade - get less than 1% of total VC funding.
WHAT WOMEN SAY...
“They don’t believe I’m solving a real business problem... A large percentage [of them] have told me, ‘I don’t think you’re solving a problem that needs to be solved. And even though I’ve got statistics to talk about how this largely affects women, especially working women, they are very suspect because they can’t relate to the business.”
“As a woman of color founder, I need to work twice as hard as a white male. -- My approach is [to] hustle twice as hard. It's just the way it is.”
HOW ARE BARRIERS TO RAISING CAPITAL DIFFERENT BY SEGMENT?
Based on the organic and unsolicited digital discussions of entrepreneurs, the #1 barrier for women is socially tied to perceptual stereotyping while men's top barrier is related to external factors like the business environment and competitive landscape. For black and Latina founders that gap is even more pronounced with social factors representing 52% and 51%, respectively.
“The hardest part of being a female in the venture capital world is getting investors to trust me when I express that I am an expert in my field. I am a female and I am Latina.”
50% of investor discussions about women founders are negative and they rank personality and vulnerability as a barrier over ability.
Investors feel more negative about women founders because they perceive them as more vulnerable than other entrepreneurs. Half of the discussions about female founders are negative with only 40% positive and 10% neutral. Deeper analysis to discover the factors behind negative sentiment shows that 60% are related to personality and vulnerability for women versus 48% for all other entrepreneurs. This confirms that women’s pessimistic perspectives are well-founded based on the way investors judge them online when no-one is asking.
58% of investor discussions highlight women's attitude, personality, and presence and only 22% relate to credentials. Hispanic women, for example, are 1.5 times more likely to be assessed on their background (31%) versus other women.
WHAT ARE THE NEGATIVE FACTORS INVESTORS DISCUSS ABOUT WOMEN FOUNDERS?
WHAT POSITIVE ATTRIBUTES DO INVESTORS DISCUSS ABOUT WOMEN FOUNDERS?
Investors who positively view women founders perceive their experience and resourcefulness as some of their top qualities.
Raise the profile on women entrepreneurs and showcase their contribution to the entrepreneurial segment.
Open up about the bias investors have towards women entrepreneurs regarding their soft skills as a barrier.
Create platforms for women to connect with investors and informally discuss what investors are looking for.
Empower women entrepreneurs with training, tools, and content to craft their story and highlight their experience and credentials.
Give a voice to the investors who already feel positive towards women entrepreneurs.