The Key Relationships that Female Founders Lack

While at a conference last week, a male investor asked me what it’s like being a female founder. The conversation took the path is usually does: How did you get your start? What advice do you give other women looking to start a company? He was interested in ways to get more women to found startups. He drilled down to two fundamental questions about the absence of female founders in the Bay Area startup ecosystem:

Do women have less access to investors than their male peers?

Would more women found startups if they had better access to those networks?

His (general) theory was that a lack of professional relationships with investors is one of the biggest hinderances for women in founding a startup. The idea was an interesting one, a variant on a few others that I’ve heard but at the same time somewhat unique. It was based on a few assumptions:

  • Access to capital is one of the most difficult aspects of becoming a startup founder. Giving up a cushy job and/or living without a salary for several months (or years) is simply impossible for most people.
  • Most investors are men, and the dynamics of women developing professional relationships with these men is more difficult than for their male peers.
  • Even if a male investor knows potential female founders, he may not identify them as such because of his pattern-matching baises (expecting founders to look male, etc etc.)

I stopped to apply this idea to my own network in the Bay Area, one that includes a lot of talented women who currently work in tech in non-founder roles. It’s true that I can think of several women who check all of the boxes as it pertains to the standard resume of a venture-backed founder these days (i.e. went to a great college, did a few years in finance/management consulting, worked at a large tech company for a few years), yet don’t then make the decision to work on their own startup. We asked ourselves some questions:

  • Are fewer of these women starting companies because their networks are less connected to (all of the predominantly male) investors?
  • Are there fewer women on the ‘let me know if you ever start something’ mental checklists that many investors have? If so, is it because they simply don’t know them?
  • Is access to capital truly one of the biggest barriers to starting a company? Is it at least a meaningful deterrent?

If the answer to any of these questions is ‘yes’, then it would mean that introducing women to investors could unlock the ‘Do I have the network to start a company?’ decision. This could then lead them to consider founding their own startup, as the risks of risking their professional and financial health they’d worked hard to build would be drastically diminished.

Based on this theory, we ended our chat with one main idea: One of the biggest positive impacts he could have with respect to a lack of women in tech would be to open his network, and introduce more women to investors. This seemed to both of us like a very actionable plan that could drive needed changes. It has the added benefit of increasing his firm’s pipeline of potential founders to invest in, matching the characteristics of founders that they already perceive and agree upon as having high-potential.

Beyond all of this, for more women to succeed in careers in tech, one of the biggest impacts on the problem overall is through the creation of more female-founded startups. Helping women establish the networks that are required for that role is something that the male-dominated industry of VC and investors can have a real impact on.