The share of venture capital going to companies founded solely by women is small — consistently reported in low single-digit percentages across multiple markets and multiple years.
The disparity is large enough that explanations based purely on differences in what businesses are started don't fully account for it, and research has examined the decision process itself.
The question asymmetry
One of the more specific findings. Research analysing investor questioning at pitch events found a systematic difference in the framing of questions.
Men were more frequently asked promotion-focused questions — about potential, growth, market size, upside. Women were more frequently asked prevention-focused questions — about risk, defensibility, potential losses, how they'd protect what they had.
The framing of a question shapes the answer, and answers oriented towards risk mitigation are less compelling to investors seeking large returns.
The same research found that founders who reframed prevention questions into promotion answers — responding to a risk question with an opportunity answer — raised more.
Which offers a practical technique and identifies a bias operating in the room.
Homophily in decision-making
Investment decision-makers remain predominantly male in most markets, though this has shifted somewhat.
Research on investment decisions has found evidence of preference for founders similar to the decision-maker, in ways that operate below conscious deliberation.
There's also the network effect. A substantial proportion of investment originates in warm introductions rather than cold approaches, and networks are homophilous. If founders access investors through existing relationships, and those relationships are gendered, the pipeline is filtered before any evaluation occurs.
This may be the larger mechanism. Bias in evaluating pitches matters less if fewer pitches happen.
Sector concentration
A partial explanation frequently offered.
Women-founded businesses are concentrated in sectors that receive less venture funding — consumer, services, health and education rather than enterprise software and deep technology.
That's true and it accounts for part of the gap. It raises its own question: why do sectors attract less capital, and is that assessment of potential or of familiarity?
There's an argument that investors systematically undervalue markets they don't personally participate in, and that consumer categories serving women have been repeatedly underestimated — with several examples of companies in such categories achieving outcomes their funding history didn't anticipate.
Performance evidence
Several analyses have examined whether the funding disparity is justified by returns.
Reports have found that women-founded companies generate comparable or higher revenue per dollar invested, and that funds with more diverse investment teams show different performance characteristics.
These analyses have methodological limitations — selection effects are substantial, since women-founded companies receiving funding may have had to clear a higher bar, which would itself produce better average performance.
That selection interpretation is itself evidence of a differential standard, so it doesn't rescue the disparity as efficient.
What has been tried
Dedicated funds. Investment vehicles focused on women founders. These have grown and remain small relative to the total market.
Diversity in investment teams. Some evidence that more diverse decision-making teams invest more evenly, though the effect operates slowly given how slowly partnerships change.
Structured evaluation. Applying consistent criteria and questions across pitches, which addresses the question asymmetry directly.
Blind initial screening. Assessing written materials without identifying information at the first stage.
Accelerators and networks providing access to the introductions that otherwise gate the process.
The alternative routes
Worth noting because venture capital funds a small minority of businesses generally, and the focus on it is disproportionate.
Most businesses are funded through revenue, personal savings, bank lending or informal investment. Those routes have their own disparities — research on lending has found differences in approval rates and terms — and they're where the majority of business finance actually happens.
Grant funding, revenue-based finance and customer prepayment are all viable and considerably less discussed.
And a business built without external investment retains control and doesn't have to pursue the outcome shape venture funding requires, which for many businesses is the better arrangement regardless.
Practical guidance
For anyone raising capital.
Reframe risk questions into opportunity answers, deliberately and consistently.
Lead with market size and growth, since these are the promotion-focused frames investors respond to.
Build the network before you need it, since warm introductions dominate.
Have the financial detail available and don't lead with it, since detailed conservative projections read as prevention-focused.
And consider whether venture funding is actually the right instrument for what you're building, before organising a business around securing it.
The due diligence asymmetry
A related finding worth noting. Beyond the questions asked in a pitch, research examining the diligence process has found differences in the depth and nature of scrutiny applied.
Where more extensive verification is required of some founders than others, the effect is both a higher effective bar and a slower process — and in fundraising, speed matters, because a slow process allows a competing deal to close first.
The practical response is preparation. Having the data room assembled, the metrics documented and the references arranged in advance converts a potential delay into a demonstration of competence.