Funding for women-founded companies overall (including mixed-gender teams) declined in the first half of 2024 compared to the first half of 2023, increasing to $15.5 billion on $93 billion – 17% – compared to $24.8 billion on $87.7 billion – 28% – in the first half of 2023, according to data from Pitchbook.
Year-to-date, companies with all-female founding teams have raised 2.2% of the venture capital allocated for the year. The data shows that all-female founding teams have never raised more than 3% of venture capital funding since at least 2014, and over the past four years, they have raised only about 2% of venture capital funding, even as the amount of capital allocated to U.S. startups has reached record levels.
Companies with all-female teams are facing a tougher 2024, as their business is proving much slower than last year, Kyle Stanford, senior venture analyst at Pitchbook, told TechCrunch. “Our data doesn’t necessarily indicate why this might be the case, but as investors pull back to support their current portfolios, there is less capital available to invest in new companies,” he told TechCrunch. “Investing in women and diverse founders is also being challenged by the current political climate.” decision against Fearless Fund in June highlights this problem.”
The challenges faced by female founders are reflected in the decline in deal numbers, he said. Venture capitalists backed 372 startups with female founders in the first half of 2024, compared to 536 in the first half of 2023.
“The majority of women-founded companies remain in the seed and early-stage of venture capital,” he continued. This can be problematic because early-stage venture capital remains difficult, “where we’ve seen many companies struggle to progress due to the stricter benchmarks for new rounds.”
There have been some notable successes, however, such as Julie Bornstein’s new startup, which was funded to the tune of $50 million. DayDream was lifted in June working on an AI-powered e-commerce search engine.
And if there’s one bright spot in this data, it’s that “investments in growth-stage female founders are on track to hit an annual record high,” he said. Here’s a success story: Romi Gubes’ Sensi.AI Raises $31 Million Series B to monitor the elders.
There’s more good news in the data, too. Funding for companies with all-female founding teams saw a slight increase year over year, reaching $1.1 billion in the second quarter, up from $900,000 in the second quarter of 2023. These teams haven’t seen a quarterly number this high since they raised $1.5 billion in the second quarter of 2022.
But the reality of the situation is that startups with all female founders are still on track to raise probably about 2% of venture capital funding this year.
“Mixed teams often get more funding because they’re seen as having a balanced perspective and a broader skill set,” Kate Bodrova, founder of edtech Amazy, told TechCrunch. She has a co-founder and is currently raising funding.
And while Bias within the VC community is almost certainly a factorRather than gaming the system, Bodrova says founders (regardless of gender) should stay focused on growth and create a team resume that demonstrates the company is in good hands.
“Focus on the value you add through your performance,” she said. “The funding will follow.”
