Female founders in the Bay Area spent 50% more time fundraising last year than their male counterparts but raised half as much money, according to a new report.
Across the globe, startups led by all-female teams got more meetings with investors in 2021 than they did the year before and raised more money, according to the report from DocSend Inc. But such founders had to expend far more effort than all-male teams and had a smaller payoff for their efforts, according to the report.
"On the one hand, there's been a spike in engagement in terms of meetings held, which is a good thing," said Justin Izzo, a research lead at DocSend, whose service is widely used by startups to share their investor presentations. "But the frustrating part is that all-female teams continue to raise less."
As part of its study, DocSend surveyed the founders of more than 200 startups around the globe. Forty-seven of those are based in the Bay Area, giving the Dropbox Inc.-owned company a view into local trends.
When seeking funding last year, Bay Area startup founders on average held 57 meetings over a course of 13-1/2 weeks and ended up raising $2.5 million, according to DocSend's study.
For local startups with all-male founding teams, the average number of meetings was 42, the time spent fundraising 10 weeks, and the amount raised was $3 million. By contrast, all-female founding teams on average held 60 meetings with investors and spent 15 weeks fundraising before ending up with $1.5 million in funding.
That wasn't the only disparity Izzo and DocSend identified. It saw similar, if slightly more muted differences between Bay Area startups led by all-white founding teams and those whose founders were all members of minority groups.
Companies with all-white founding teams on average held 59 meetings with investors over a period of 13 weeks before raising $2.6 million. Those with all minority members — defined in the report as anyone who is non-white — held 55 meetings on average over 14 weeks and ended up raising $2.1 million.
The increasing discussion about funding disparities has put a spotlight on the venture industry that could force it to invest more equitably, Izzo said. But it's on investors to change the way they do business, he said. That's something the venture capitalists who have reacted to the report have acknowledged both publicly and privately, he said.
"It's not on the founders to change who they are in order to appeal to VCs who may not be interested in funding them," Izzo said. "That puts the onus on founders to revolutionize a system that is biased against them." Izzo said.
