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Investor Highlight: Female Founders Fund

Investor Highlight: Female Founders Fund
October 12, 2021

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Here at PrivCo, we're preparing the data and insights to launch our Diversity Report 2.0. If you have read our original report or have been around VC investing much at all, you already know that a dearth of VC funding goes to female and BIPOC founders. Today we're looking at one VC firm seeking to change that dynamic with an investment focus entirely on women. Female Founders Fund began in 2014 in response to the tiny percentage of venture capital dollars going to female-founded companies (2% in 2014, and only 2.3% in 2020).

The Harvard Business Review shows some impeccable metrics as to the boost in ROI that female-founders can give a company, citing a Boston Consulting Group analysis showing as much as two times the revenue (vs. men) per dollar invested. While the wage gap in earners held steady in 2020, investments in women tell another story. For every dollar invested in female-founded companies, startups generated 78 cents, while male-founded companies brought in 31 cents. Not only that, but companies with female founders employ 2.5 times more women.



It starts with VCs
There is no lack of women starting businesses. In 2020, 47% of women started a business as opposed to 44% of men, and they own 12.3MM businesses in the U.S. While not all women who start businesses seek VC investment, they have a more challenging time finding firms that hold the key to a greater likelihood of success in fundraising–a female VC.  Women venture capitalists make up only 12% of decision-makers, while most firms have no female partners at all.

Cue Female Founders Fund
A common occurrence for any female founder pitching a business venture meant for a female consumer is to hear a male VC say, "let me ask my wife." The inability of male venture capitalists to understand a company's value proposition targeting the 85% of all purchasing power that women possess is frankly lousy business. Female Founders Fund has made investments in many household name companies over the years, including Zola, Eloquii (acquired by Walmart), Maven Clinic, and Billie. The firm closed a $57MM round in July, bringing its total assets to $95MM.

But it's not just female-centric products. Tala is a credit infrastructure fintech platform for underwriting loans in emerging markets. Kensho is a discovery platform (think Yelp) for holistic medicine based out of New York. 

For more Female Founders Fund investments, check out the firm's deals page here.

Who were the winners of Q3?
Earnings season reflects supply chain slowdowns.
Amazon gets flexible
Formerly strict return-to-office plans loosen to a more flexible approach.
[NY Times]
Since last week, PrivCo has added:

185 Companies | 236,181 Funding Activities | 56 M&A Deals

Funding & Deal Highlights:

Swile raises $200MM from SoftBank Capital
Food Delivery • Round D • Paris, France

Elliptic raises $60MM from Evolution Equity Partners
Blockchain AnalyticsRound C • London, UK

Homa Games raises $50MM from Northzone Ventures
Games • Round A • Paris, France

Productfy raises $16MM from CM Ventures
Fintech • Round A • San Jose, CA

Ambition raises $15.5MM from Primus Capital 
Performance Management • Round B • Chattanooga, TN

Parthenon Group acquires CMA Strategy Consulting 
Consulting • Acquisition • Boston, MA

GLS Group acquires Rosenau Transport Ltd. for £210MM
Logistics Services • Acquisition • Utrecht, Netherlands

Instacart acquires FoodStorm
Food Delivery • Acquisition • San Francisco, CA

Facemoji raises $3MM from Play Ventures
Computer Vision • Seed • New York, NY

BetterUp raises $300MM from ICONIQ Capital
Mental Health • Round E • San Francisco, CA

 
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