Female focused VC funds helping founders build winning teams in 2024
International Women’s Day brought an alarming statistic to our attention: the funding gap between male-founded and female-founded companies is widening.
Just 2.1% of VC funding went to female-led startups in 2022. This fell to 2% in 2023. However, companies with at least one female founder deliver higher exit returns.
So why is this VC funding gap widening?
And are there any female focused VC funds helping to bridge the gap?
Some reports speculate the pandemic made investors more wary of risks, so investors stuck with their “pattern-matching habits”. In other words, they backed the same kind of companies they’ve supported in the past (i.e. tech companies led by men).
Others suggest the lack of awareness of the funding options available and a reluctance to take on debt may explain the gap.
Whatever the reasons, female focused VC funds are shaking up the industry.
VC funding for female-founded US companies rose to record levels in 2021, reaching $54.9 billion. And although funding dropped to $44.4 billion in 2023, this was still up more than 40% on funding in 2019.
So before we dig into how you can apply for VC funding, let’s explore some VC funds for female founders.
A new wave
London-based Pink Salt Ventures (PSV) was the UK’s first female focused VC fund. The micro VC was started by Samira Ann Qassim, and it launched its second fund in 2019.
The new fund invested in 12 female-led companies, writing cheques of up to £350k for a 5-15% stake in each business.
For Qassim, backing women isn’t just a moral calling.
“I started PSV not because of the funding gap, but because I was looking at these different macro trends of innovation […] I decided to invest in female founders because they’d be building in these kinds of areas.
“The intention was always to look for outsized returns. That’s what you’re doing as an investor.”
Auxxo, Germany’s first female focused VC fund, launched in November 2021. More have come since, including Sie Ventures — a capital platform for female entrepreneurs.
Female focused VC funds
If you’re looking for funding, it’s worth familiarizing yourself with firms and investors that help entrepreneurs like you.
VCs funding female founders include:
Merian Ventures — US/UK firm focused on women in deeptech
“I want to make it easier for women and minorities with STEM aspirations to create companies […]” – Alexsis de Raadt St James, Managing Partner at Merian Ventures
January Ventures — US firm
“We back founders based on their tenacity and ambition, not their pedigrees or who they know.” – Jennifer Keiser Neundorfer, Co-Founder at January Ventures
Unconventional Ventures — Nordic early-stage female focused VC fund
“Unconventional is often what the world needs in order to change.” – Nora Bavey & Thea Messel, General Partners at Unconventional Ventures
Forerunner Ventures — US firm for women
“We’re a diverse team of visionaries and veterans who looked at the VC industry and said: ‘We can do more.’” – Jason Bornstein, Principal Partner at Forerunner Ventures
Female Founders Fund — New York-based firm
“In 2014, we created the Female Founders Fund with one simple belief: women will build the companies of tomorrow.” – Anu Duggal, Founding Partner at Female Founders Fund
Tips for female founders on how to get VC funding
#1: Prepare an action plan
Although the fundraising process changes from stage to stage, having a plan is crucial.
Across all stages, it’s important to plan when you want to start fundraising and which VCs you want to engage with.
It helps if this plan includes an ongoing process of building relationships and crafting your story, even when you’re not actively fundraising.
#2: Leverage your current investors
If you’ve already secured investment, consider your existing investors and board members.
Founders who’ve done their research and identified VCs that might be a great partner for the next stage of growth don’t always engage with the partners they already have. But remember that your existing investors can be a bridge to other investors.
Consider doing a practice round with your existing investors. This can help you identify questions investors might have and increase your confidence in responses.
#3: Craft your pitch
Top-tier female focused VC funds look for the same thing: exceptional founders building scalable businesses with products that customers love.
Hone your pitch and storytelling to show VCs why your company fits this bill. You want them to get excited about what you’re doing!
It’s important to know that different investors focus on different areas depending on the stage:
Pre-Seed / Seed: The team, market, and product vision matter a lot. There won’t be many data points for a VC to look at, so you’ll need to emphasize why your business needs to be built and why you’re the right person / team to do it.
Series A: Demonstrating product-market-fit is key. Share initial data points around commercialisation and what customers say about your product.
Series B, C and further into the growth stage: Financial metrics and traction to date are even more important. Emphasize the scalability of your product and your engine for efficient growth.
Summary
Despite the challenges, there are female focused VC funds looking to support female founders. It’s an exciting time for female entrepreneurs and building the team of your dreams is possible with the right support.
Alright, so you’ve followed our tips and secured funding (we knew you’d do it!) Are you looking for help with growing your team?
We can help!
Here at Gun, we help companies of all sizes – from Fortune 500s to startups – hire the best tech talent in days so that you can focus on growing your business. Contact us today to learn more!
