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The Clayman Institute started with the question of why do women receive just 4.2% of venture capital funding? Was pipeline the reason? Or did gender play a role?
To understand the possible subtle biases that may impact Venture Capital funding of women entrepreneurs, the Clayman Institute conducted a study to test two hypotheses:
- Women are seen as less technically competent
- Women need networks more than their male counterparts
We created identical executive summaries; changed gender and education for the "entrepreneur." Participants rated the venture's potential for success, impression of the entrepreneur, influence of social networks.
Our findings?
Female and male technical entrepreneurs were rated similarly - having technical degrees can level the playing field.
We also found that women non-technical entrepreneurs received significantly lower ratings than non-technical men. In fact, a non-technical degree can raise the ratings for male entrepreneurs, while they are detrimental to women.
For all women entrepreneurs, strong network ties are critical for success. Having strategic connections helps women entrepreneurs, more than men, when it comes to Venture Capital decision making.
The authors of the study are Justine E. Tinkler, Andrea Davies Henderson, and Manwai C. Ku.
Download a summary of the report, here. [PDF]
