We found that there are discrepancies in how investors evaluate men-led and women-led
startups, potentially leading them to overlook promising startups and overestimate less
promising startups. This implementation guide outlines three steps we found that accelerators can incorporate into their selection processes to consistently evaluate all startups more accurately.
The gender financing gap persists. Women-led startups raise significantly less capital than startups led by only men. That number has hardly budged over the past decade — despite the fact that data continues to suggest that women-led startups outperform startups with all-men founding teams.
For investors and entrepreneur support organizations, focusing on only a fraction of all entrepreneurs means they leave significant opportunities for returns on the table. For startups, this gender financing gap means promising innovations do not receive the resources they need to scale.
The “Smarter Systems” toolkit not only outlines 3 ways to reduce discrepancies in investment evaluation processes, it also proves why doing so is key for unlocking more opportunities for investors, accelerators, and women-led startups, and increasing equity in the innovation economy.
This toolkit, developed by Village Capital in partnership with IFC, the Women Entrepreneurs Finance Initiative (We-Fi), and academic research partners Amisha Miller and Saurabh Lall, includes action-oriented implementation guides — one for individual and institutional investors and for incubator and accelerator leaders. The guides focus on concrete steps and tools investors and accelerators can use in their own investment processes and programs to help foster more consistent, comprehensive, and data-driven evaluations.
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