It’s been well documented that the pandemic disproportionately reduced venture capital funding for female founders last year, despite a greater boom in fundraising thanks to megafunds and the rise of Zoom investing.
We know that only 15% of partners in venture capital funds are female and that only 2% of angel investors in Canada are female and female founders receive only 3% of VC dollars.
Women of colour receive just 0.2% of funding, and there are no stats available for Indigenous women, LGBTQ women and/or women with disabilities, likely because the numbers are so small.
According to Boston Consulting Group, female-owned start-ups generated $0.78 revenue per dollar invested, compared to male-only start-ups who generated $0.31 revenue per dollar invested.
And First Round Capital tells us that female-founded companies perform 63% better than all-male founded companies.
The lack of gender equality in funding startups leads to further problems. It affects the overall jobs picture for women exponentially. It’s also likely to slow the recovery and efforts to tackle inequality. This is an underfunded and underrepresented group that is overperforming and to bolster investment activity just means good business.
With that as a backdrop, our team at Sandpiper Ventures a Canadian seed stage, angel backed Women’s Fund, is taking this head on. In just 18 months we have deployed capital into six women led companies and counting with over 120 others in the pipeline.
What we are doing differently begins at the pitch level. We don’t see it as a one-way process, but rather a mutual engagement with founders. With this approach we are building a deeper relationship and understanding of the mutual value of a VC/Founder partnership with deep and professional due diligence that is data driven to further remove bias.
We see the VC/founder relationship differently – it is not the founder coming to knock on our door asking for money but a mutually beneficial partnership. As operators, we build a structure of support around our portfolio companies, engaging with our network of industry experts, providing experienced support in key areas of governance, team and culture development, partnership negotiation and development, commercialization strategies, CEO coaching and beyond. Ultimately, we are providing access to unique tools and networks to support our portfolio companies to reach massive proportion. We continue to see positive results with this innovative approach. This value-add and network effect also attracts new founders to the Fund and enables access to exceptional deal flow.
2022 will be a big year for women in ventures. As investors continue to be bullish on the Canadian tech scene we will also see more women fill roles in ventures than ever before. As this trajectory continues upwards, we at Sandpiper are proud to be leaders in the movement.
Rhiannon Davies is Managing Partner at Sandpiper Ventures.
Image: Pam Kostka