Study after study has shown the value that having women in leadership positions brings to the bottom line. One study, for example, demonstrated that Fortune 500 companies that have at least three women directors saw a 66-percent increase on invested capital. And women-operated, venture-backed companies have 12 percent higher revenues than those operated by men. Yet women entrepreneurs begin with only one-eighth of the funding of male-owned companies, and women-owned startups receive only a fraction of the venture-capital funding that goes to their male counterparts.
“The statistics are outrageous,” said Justyn Hintze, director of the volunteer-run nonprofit Women Who Tech. “When you look at the ROI of startups, gender-diverse companies perform 15 percent better than companies that are not gender diverse. Similarly, ethnically and racially diverse companies perform 35 percent better.” Yet only .2 percent of venture-capital funding goes to startups led by women of color, she said. “The stats are staggering in every direction.”
Women Who Tech, which was founded in 2008, is working to close the funding gap and draw global attention to gender bias in venture-capital funding. One key method is hosting Women Startup Challenges, which identify female-owned early-stage startups and invite them to compete for funding. Startup Challenges have been held in Washington, D.C., New York, and London, and most recently in Paris, where the Women Who Tech Startup Challenge Europe was co-hosted by the Office of the Mayor of Paris at City Hall. The winner — Sampson Solutions, which is creating bio-based construction materials — was awarded $35,000. A second startup, Virtue Health, was awarded $25,000 for its work developing computer-vision tools that can monitor the motor functions of patients during medical exams.
Although the pitches are the centerpiece of the Startup Challenges, “it’s not just a pitch competition,” Hintze said. “We work with the startups from the moment they’re invited to pitch.” Finalists participate in a pitch webinar coordinated by Women Who Tech, and are given opportunities to practice, Hintze said. “We give feedback, and we provide one-on-one mentoring beyond that. We make sure that they’re really ready to pitch and ready to actually speak with investors.”
The Startup Challenges attract a wide range of startups. “It’s everyone from people who have maybe pitched once or never, to people who are pitching on a weekly basis,” Hintze said. “We do it a little differently to make sure that we’re working with them from the beginning to make sure they’re receiving the support they need to succeed.”
The challenges are open to the public, and so far more than 2,000 people have attended the pitch competitions, Hintze said. “A wide range of people attend the Startup Challenges, including investors, developers, and media,” she said. “The general public gets to be inspired by these amazing startups, and participants are able to really expand their networks and know that this is something that’s possible.
“We’re pushing forward,” she added, “helping to fund as many women-led startups as we are able to.”
More from our December issue
Better Together: Why Business Events Are Embracing Startups