An article we liked from Thought Leaders Jo Ann Corkran and Loretta McCarthy of Golden Seeds:

What the ‘2% of VC funding’ stat gets wrong about women entrepreneurs

You often hear that female entrepreneurs receive less than 2% of venture capital funding.

But there’s more to the story, say these experts.

The narrative that women entrepreneurs receive less than 2% of venture capital (VC) funding has been widely circulated. It stems from data provided by Pitchbook, a respected research firm that delivers insights on global capital markets. However, a closer examination of their data reveals a more nuanced perspective. Pitchbook only studies investments funded by VC firms, which is a big part of the market but does not include the very substantial investments made by angel investors. Significant progress has been made in these early stages of the venture market.

Twenty years ago, a mere 3% of angel-funded startups were led by women. Fast-forward to today, and women now account for well over 30% of angel-funded companies. Researching and monitoring these shifts have been a critical part of our own investing journey as the co-CEOs of Golden Seeds, an organization that invests exclusively in early-stage women-led U.S. companies.

Back in 2004, when Golden Seeds was founded, there was a data void. Insights on women entrepreneurs and women’s leadership were rarely collected because they simply weren’t considered important. Thankfully there is now more research into these topics. Pitchbook has been a leader in this effort, particularly as it relates to later-stage venture capital funding. But in the process of deciphering the data around female founders, a misleading narrative has inadvertently been created.

Understanding the methodology behind these—and any venture—statistics is crucial to appreciating the strides made by women in the startup ecosystem. Here are the two biggest misrepresentations worth clarifying about women entrepreneurs and their ability to secure capital.

Misinterpretation #1: Women get less than 2% of capital

Countless articles, books, and panels have cited that only 2% of VC funding goes to women entrepreneurs. However, this interpretation is incorrect because Pitchbook collects data only on company founders, which excludes women in executive leadership roles or those who might move into executive roles and hold substantial equity. These women are not included in these calculations but they play important roles in the success of their companies.

Furthermore, when including funding received by gender-diverse founding teams, the numbers reveal a more encouraging trend. In 2024, companies founded by at least one woman secured 23% of total VC capital, a considerable increase from just 9% in 2008. Additionally, the percentage of deals VCs invest in that include at least one female founder has more than doubled in the same time frame, from 12.2% to 25.4%. That number may in fact be even higher when you consider that this data excludes companies that have non-founder women in key roles who hold substantial equity.

The growing presence of gender-diverse teams signals a positive shift in the funding landscape, as startup investors increasingly recognize the benefits of diverse leadership in driving business success. It also more accurately reflects the full universe of startups seeking capital today.

Of course, the reality remains that 75–80% of VC funding goes to companies with all-male founding teams (although we do not have information on the gender diversity of the management teams of these companies at the time of funding). More work is needed to get the venture industry closer to realizing gender parity. And it’s critical that we analyze the current data beyond just the...

Read the rest of this article fastcompany.com...

Thanks for this article excerpt to Jo Ann Corkran and Loretta McCarthy, co-CEOs of Golden Seeds.

Photo by olia danilevich

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