Female GPs are an undervalued asset
Published 12 October 2023
A new 2023 report from European Women in VC highlight new findings of diverse investment teams in the growth and venture space.
Key highlights from the report include:
- Higher Female representation equals better VC fund performance: European VC funds with increased female representation in senior management teams show improved financial performance, with mixed teams outperforming all-male teams by 9.3 percentage points.
- Correlation between female representation and fund success: A 10 percentage point rise in female representation correlates with a 1.3 percentage points increase in VC fund IRR, highlighting a direct link between gender diversity and financial success.
- Female managers reduce portfolio volatility: European VC funds led by women experience lower volatility in portfolio returns, showcasing the stability brought by diverse management teams.
- Persistent gender gaps in European VC firms: Despite higher returns in female-led funds, gender disparities persist in European VC firms, with only 16% of general partners being women in 2023. This is, however, an increase from 15% in 2022.
- Limited investment power for female GPs: Female general partners raise only 9% of total AUM compared to their male counterparts, underlining the challenge faced by women in securing significant funding opportunities.
- Wealth generation challenges for women in VC: Limited investment opportunities for women hinder wealth accumulation, impacting their ability to contribute back to the sector, posing a barrier to customary practices in the VC and startup spaces.
Read the full report here.