In the past year, funding for venture capital companies founded by women in the United States has dropped significantly. But new research from PitchBook shows that change has already begun.
The onset of the pandemic disproportionately affected investments in companies that have at least one female founder. The number of deals involving companies with solely male founders fell 5.4% in June 2020 compared to March, and then rose again for the rest of the year. However, as PitchBook data shows, investment activity in companies founded by women fell by almost 30 percent and remained depressed for most of the year.
Startups with female founders have done much better this year. They raised more venture capital dollars and made more exits at a higher cost than at any other time in the past decade. Startups with a female founder raised over $ 40 billion in September, nearly double the amount invested in companies founded by women in all of 2020 or 2019.
Most of the increase in investment has been concentrated in high tech, healthcare and retail.
However, these investments made up a small fraction of the overall market, accounting for roughly 18 percent of the $ 239 billion raised by all venture capital firms in September.
The PitchBook report suggests a growing number of female angel investors and general partners in foundations are actively seeking support from female founders. As of the end of 2019, 12 percent of the general partners of venture capital firms were women, and there were 740 female angel investors. Today, 15 percent of the general partners of venture capital firms are women, and there are now about 1,000 female angel investors.
