Hello and welcome back to Equity, a podcast about the business of startups where we unpack the numbers and nuance behind the headlines. This is our Wednesday show, where we niche down to a single person, think about their work and unpack the rest.
Interview with Kaisa Snellman
This week, Natasha interviewed Kaisa Snellman, an economic sociologist and an associate professor of Organizational Behavior and academic director of the INSEAD Gender Initiative. We know, we know, it’s a flex.
The Research: For Female Founders, Fundraising Only from Female VCs Comes at a Cost
Kaisa’s recent Harvard Business Review piece with Isabelle Solal explores the implications of women-led startups that raise their first round exclusively from female VCs. The duo’s research asserts that these companies are 2x less likely to raise a second round regardless of initial funding round size, industry, geographic location, or prestige of the investor.
Listen to the whole conversation before you jump to conclusions, but let’s just say that this conversation really got into the numbers and nuance behind the headlines. The data is both revolutionary and provocative.
The State of Female Fundraising
Women-founded startups raised 1.9% of all VC funds in 2022, a drop from 2021. Here’s what we got into:
How People See Female Founders
People often view female founders who just raise from female investors as being more deserving or worthy of investment. However, this perception is not entirely accurate.
Pitching Bias Continues to Exist in the World
The pitching bias that continues to exist in the world means that male-led startups are still more likely to secure funding than their female-led counterparts. This is despite the increasing number of women entering the startup ecosystem.
The Answer to Imbalances is More Complicated Than Getting Female Check-Writers to the Table
While getting more female check-writers to the table is a step in the right direction, it’s not enough to close the fundraising gap. The research suggests that we need to go beyond simply increasing the number of women in positions of power.
Diversity Quotas and Funds May Have Unintended Consequences
Diversity quotas and funds may have unintended consequences that are worth thinking about more thoroughly. For example, do these initiatives truly address the underlying issues or just provide a superficial solution?
Conclusion
The Equity team will be back on Friday with a familiar voice you may be missing. In the meantime, keep up with us on Twitter at @EquityPod. You can also find episode transcripts and more on our Simplecast website.
Subscribe to Us
Don’t miss out on future episodes! Subscribe to us on Apple Podcasts, Overcast, Spotify, and all the casts. TechCrunch also has a great show on crypto that interviews founders and details how their stories come together.
Bio
Natasha Mascarenhas is a senior reporter at TechCrunch covering early-stage startups and venture capital trends.
