Pitching your business to VCs is much harder if you are a woman. A growing body of evidence shows that female entrepreneurs in all lines of business receive significantly less funding than their male counterparts (1, 2, 3). A recent article (4) discusses where the bias may start and what you can do about it.
Some key insights from the study:
- VCs tended to ask women questions about the potential for losses – men about the potential for gains. Interestingly, both men and women who evaluate startups appeared to display the same bias in their questioning,
- Most entrepreneurs responded in a manner that matched the type of questions they were asked, namely focusing on safety, responsibility, and security – as opposed to hopes, achievements, and ideals).
- Responding in kind to these questions, female entrepreneurs penalized their start-ups by remaining in the realm of losses.
The good news: you can learn to recognize this pattern and frame your responses to benefit your startup.
“When it comes to venture funding, entrepreneurs need to convince prospective investors of their startups’ “home run” potential — it’s not enough to simply demonstrate that they’re unlikely to lose investors’ money.”
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