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This article was published on November 28, 2023

European VC ecosystem heavily biased against female founders

'How will you handle being pregnant and running a business?'


European VC ecosystem heavily biased against female founders

Among the barriers European tech has to overcome, gender diversity is undoubtedly a pressing one. The numbers are telling. So far in 2023, female-founded startups have raised less than 2% of the total VC capital in Europe.

A new study by global early-stage VC firm Antler shows that, unsurprisingly, female founders have to routinely deal with gender bias.

Antler surveyed founders based in Germany, the Netherlands, Sweden, Norway, and the UK on their recent experience with angels and VCs. All of the respondents said that the European investor ecosystem is biased against women.

Specifically, two-thirds (64%) of the founders reported that their gender has actively made it difficult to raise investment. At the same time, a third (32%) have felt the need to call out investors for unconscious bias during pitching meetings.

Diversity is a critical factor lacking in European venture capital.

The picture gets even grimmer: a whopping 72% of the respondents also said that they have been asked questions that male founders wouldn’t have been asked. These included inquiries about family planning and pregnancy.

“Why do conversations about female founders immediately lead to conversations about combining the journey with having a family?,” commented Karolina Ling-Vannerus, founder of Sweden-based sustainable packaging startup Circulate, who took part in the survey.

“I don’t understand why we always worry and think it’s women in their 30s-40s who have families, when it takes two to tango? Provided that the vast majority of families are heterosexual couples, there are just as many men affected? So this equally applies to ALL talent in our 30s-40s regardless of gender?”

Meanwhile, the vast majority of respondents (95%) called on VCs to hire more female investors as a means to driving positive change. The founders also suggested data transparency on diversity, the inclusion of parental leave policies in investment terms, and promoting women’s success stories through social channels.

“Diversity is a critical factor lacking in European venture capital. In 2022, only 1.8% went to female founders, and 12% to mixed founders, revealing blind spots in the ecosystem,” said Sarah Finegan, Director at Antler.

For Finegan, to cultivate a more inclusive VC ecosystem, it is “essential to prioritise representation.” “We’re seeing lots of positive change in the industry already, but more needs to be done,” she told TNW. “A more inclusive VC ecosystem will support a new generation of diverse tech founders which will be great news for European tech.”

Studies have shown that female-led companies tend to return higher revenues, while scaleups founded by women in Europe have not only seen their value increase almost 6.5 times in the past five years, but have also grown 1.2 times faster than other scaleups. This means that investing in female entrepreneurship is as much a prerequisite for social equality, as it is good for business.

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