Britain’s startup scene has room for improvement when it comes to gender equality. Not only are fewer founders female but the women who do take steps towards launching a business are also less likely to raise funding than their male peers. And now a new study has revealed that things are similarly lacklustre on the VC side of the ecosystem.
Having looked at 160 VC firms that are active in the UK and those companies’ 1,559 employees, Diversity VC, the non-profit organisation promoting equality in the VC industry, has revealed that women are significantly under-represented. While 47% of the overall UK labour force is female, only 27% of employees at VC firms are women. And few of them are able to influence where the firms invest, with just 18% having analyst or partner titles. Of the employees in non-investment roles, 43% are women.
Looking more closely at the final decision makers – typically an investment partner or someone in an investment committee – Diversity VC found that only 13% are women. Additionally, almost half of VC firms don’t have any female representation and 66% of investment teams employ no women with decision-making powers.
“It’s sobering to see that women are so underrepresented in our industry,” said Travis Winstanley, games investment director at Catalis Group, the digital content provider, and cofounder and data project lead at Diversity VC. “As venture capitalists the culture and tone we set in our firms has a significant impact. It not only affects our immediate colleagues but impacts on our portfolio companies and on the wider society too.”
Following the figures unearthed by its survey, Diversity VC hopes that the percentage of women in senior decision-making roles at British VC firms will have grown by 7% to reach 20% by 2020. To achieve this target, the organisation recommends that companies launch initiatives to attract more women, retain and promote more women, promote diversity in the wider ecosystem, partner with and promote the work of other organisations and continue to collect data.
Commenting on the goal, Winstanley continued: “Whilst we’re starting from a low base, we should be optimistic about the road ahead. There is a greater representation of women in junior roles – at 29% – and there is significant willingness in the industry to redress the gender balance further still. This is just the start. We will continue to provide research on the industry, documenting our progress and sharing examples of successful women and other underrepresented groups. More significantly, we aim to proactively engage with firms and help facilitate their programs of change.”
Thankfully, it seems that the wider startup landscape is also taking the problem of female representation seriously too. In March, Tech London Advocates launched the AAA Award for Gender Diversity to boost equality and minimise bias in the tech industry. Similarly, a slew of initiatives have recently been announced to help female entrepreneurs.
And given that several studies have shown that companies with more female representation operate more effectively, initiatives that promote gender equality can only be good for the wider startup community.