Feb 18, 2022
Women Entrepreneurs at the Top: Is the Gender Gap Tumbling in Venture Capital Investment?
Usually, in the startup ecosystem, founders' credentials, team strength, innovative products/services, market access, and growth potential influence the decision-making process of venture capital firms and other investors. However, gender has also emerged as one of the factors that may influence the decision-making of investors. So, it is interesting to note emerging trends in terms of the influence of gender vis-à-vis venture capital funding. Currently, there is a gender gap pertaining to venture capital investment in new businesses. Women founders or entrepreneurs are behind their male counterparts. In 2021, 2.4% of the total capital spent on venture-backed startups in the US went to businesses created by women. But that figure does not fully convey the situation. In the US, venture capital funding for firms with female founders or co-founders has been rising recently. In 2021, several women-led funds, incubators for female entrepreneurs, and more new businesses were formed. Over the past 14 years, there has been a trend in the US of women raising capital from VCs. Deal counts by state, industry, and stage are broken down, and a few female-founded enterprises and businesses are highlighted.
VC deal activity for US-based, female-founded businesses was already on par with the annual totals for 2020 and 2019 in the first half of 2021. US Venture Capital startups with female founders raised an outstanding $2 billion during that time. Female-founded businesses in the US are now raising more venture funding than they have at any other time in the preceding ten years, an encouraging shift in representation.
Female Founders in FemTech
The FemTech sector is dominated by women entrepreneurs, and they are attracting robust investment from Venture Capital firms India. FemTech refers to diagnostic instruments, products, services, wearables, and software that uses technology to treat problems with women's health, including menstrual, reproductive, sexual, maternity, and menopausal disorders.
Samantha Diamond is the co-founder and CEO of the Toronto-based company Bird&Be, which will began selling pregnancy, ovulation, ovarian reserve, and sperm concentration testing kits in the latter half of 2021. Aavia, a New York-based company co-founded by Aagya Mathur, Aya Suzuki, and Alexis Wong, is a smart pill case and an app that teaches people with periods about their cycles and mental health patterns. A supplier of fertility, gynecology, and family-building services at its private clinics and network of partner clinics, Gina Bartasi is the founder and CEO of Kindbody. Four times in a row, Bartasi has served as CEO. Additionally, she is the mother of twin boys born through in vitro fertilization (IVF). In response to the desire from employers to purchase fertility benefits directly from healthcare providers, she established Kindbody in 2018. In June 2021, Kindbody raised $62 million of Series C funding in a deal headed by Theresa Sexton at Claritas Capital.
The Drivers of Sustainability Sectors
From monitoring and reducing urban pollution to facilitating greater access to electric vehicles and bicycles, founders working in sustainable city-building and transportation are addressing various challenges and opportunities. Co-founder and CEO of StreetLight Data, Laura Schewel, provides on-demand measurements for automobiles, bicycles, and pedestrians. StreetLight Data is a developer of a transportation data platform. The San Francisco-based company's solution uses vast quantities of geospatial data generated by mobile devices to generate insights into mobility patterns and travel behavior that can be used to guide transportation planning. Osage University Partners, Ajax Strategies, and Activate Capital Partners provided $15 million in Series C1 Venture Capital to StreetLight in June 2020.
Liz Gilligan is the founder and CEO of Material Evolution, a Belfast-based firm that uses geopolymer technology to develop sustainable alternatives to Ordinary Portland Cement (OPC). With an annual production of over four billion tonnes, cement contributes roughly 8% of the world's CO2 emissions. The company's product is stronger, more resilient, more affordable, and consumes 85% less carbon than OPC equivalents while being created from 95% industrial waste. Gilligan launched Material Evolution in 2017, and to her startup, she brings decades of experience in project management, regulation, and construction.
The H2O & Clean Tech Innovators
Water-related companies run by female entrepreneurs include watershed management, monitoring water systems, water access, and sustainable packaging options. Whether we live on a coast or in the interior, water has a significant impact on both our internal makeup and the situations we experience daily. As the effects of climate change manifest, it will continue to have an impact on public health, the kind of foods we can farm, as well as the neighborhoods and physical structures we call home. The co-founder of Viridis Research, a young company that offers services and solutions for water purification, Macarena Cataldo-Hernandez, wants to ensure that all communities have access to clean, safe water. Meena Sankaran is the founder and CEO of KETOS, a water analytics system that is used in municipal, industrial, and agricultural applications to monitor, control, and forecast water quality and efficiency.
Indian Women & Unicorns
The first woman to lead an Indian unicorn, Ambiga Subramanian, sold her stock back to Dhiraj Rajaram, the company's founder, and ex-husband. The startup is supported by investors such as Sequoia, General Atlantic, and Mastercard. Falguni Nayar, a 2012 founder of the beauty e-commerce site Nykaa and a former senior banker at Kotak, graduated from IIM-Ahmedabad. In India, during the last few years, she has served as the face of woman's entrepreneurship. Last year, she started the company's IPO at a valuation of nearly $10 billion. Despite subsequent stock declines, Nayar and her family still hold 50 percent of Nykaa and successfully manage the business.
In 2018, Pristyn Care was founded by Garima Sawhney, a physician from the Maharashtra University of Health Sciences who previously worked at the Max Super Speciality Hospital and the CK Birla Hospital in Gurugram. Pristyn Care is a technological platform that uses extra space in hospitals to build multispecialty clinics and operation centres. It is supported by investors, including Sequoia and Tiger Global. With her husband Varun, Ghazal Alagh co-founded Honasa Consumer Private Limited, which trades as the modern skincare and body care company Mamaearth. Ghazal recently participated as a shark and investor on Shark Tank India, a prominent business show. Before a new Mamaearth product is released to the general public, Ghazal is renowned for testing it on her to look for adverse effects.
IIT Delhi, Harvard, and Stanford alumnus Gazal Kalra co-founded the trucking logistics platform Rivigo. Among others, Elevation Capital and Warburg Pincus have invested in the business. Before founding Rivigo, she worked as a consultant for the World Bank Group and previously for McKinsey. The co-founder of Byju's and the country's most valuable online company, Divya Gokulnath, is responsible for Byju's content management. When Raveendran was taking classes before launching a business, she was also one of his students in the past.
The list of women entrepreneurs at the top is expected to be long in times to come, and the trends are visible across the globe. Obviously, North America and Asia would play an important role in reducing the gender gap pertaining to venture capital investment decision-making.