Fundraising by women-led VCs hits peak but industry representation still dismal

Dzuleira Abu Bakar at DEALSTREETASIA's Asia PE-VC Summit 2017 in Singapore. Photo: DEALSTREETASIA

Funds raised by women-led venture capital vehicles have reached record highs in 2017 even though their representation in global firms stands at only 21 per cent which shrinks further at senior levels.

According to a recent report by research firm Preqin, 13 funds led by women have secured $2.4 billion this year as of October 2017, as compared to $0.8 billion raised by twelve women-owned funds in 2013.

However, in the larger scheme of things, the figure is still minuscule when compared to those being raised by funds led-by men.

“Women only represent one in five staff at venture capital firms, and one in ten senior staff, highlighting the uncommon nature of these programs, and the structural and long-term challenges they face,” said Felice Egidio, Head of Venture Capital Products, Preqin.

“However, we may feel encouraged by the fact that women-owned venture capital funds have steadily become more common and more active, raising more money in the first three quarters of 2017 than ever before as well as being involved in over 500 financing rounds,” he added.

Annual Venture Capital Fundraising by Women-Owned Firms, 2007 – 2017 YTD (As at October 2017) 

At present there are 58 women-owned venture capital funds in the market, seeking a combined $6 billion. One-third of this total amount is, however, being raised by the largest of these, Baidu Capital, which is targeting $2.95 billion.

Fundraising this year is also led by Baidu Fund Partnership, a $1 billion joint venture between China Life Insurance Company and led by Baidu’s CEO Jennifer Li, CFO Zhang Jinling and managing partner Wenjie Wu, targeting late-stage internet investments in China.

Even at a senior level, women constitute 11 per cent of staff, and occupy only six per cent of venture capital board seats, showed the Preqin data.

Among the most active female board representatives at venture capital-backed portfolio companies in 2017, Indian venture capital firm Kalaari Capital‘s founder Vani Kola ranked second with 10 board seats following Cindy Padnos of US-based Illuminate Ventures.

In the first three quarters of 2017, women-owned funds have been involved with 510 deals, worth a total of $6.4 billion.

Breaking up the funding by geographies shows that almost three-quarters of funding for women-owned venture capital funds comes from North America-based investors. European and Asian investors account for 20 per cent and 5 per cent of commitments, respectively.

Even though a majority of the largest women-owned venture capital funds in the market are based in the US, two of the top three funds are based in Asia, with Baidu Capital looking to raise $2.95 billion and Arbor Ventures raising a $200 million fund.

Largest Women-Owned Venture Capital Funds in Market (As at October 2017) 

On a partner level, female partners have led 307 deals in 2017 so far, worth a combined $5.1 billion. This is a record for both the number and value of women-led deals, and accounts for 9 per cent of total deal activity this year.

“We should promote diversity within management,”  Dzuleira Abu Bakar, CEO of Cradle Seed Ventures had said at the recent DEALSTREETASIA PE-VC Summit in September on a panel on ‘Examining the gender funding gap and the VC monoculture’. Cradle Seed claims to have 30 per cent female representation on the board.

In an earlier interaction with this portal, Dzuleira, an investment professional with over 12 years in the industry, feels that the perception that these sectors are male-dominated could be a possible cause for women shying away from entering the industry. “It is also a function of traditional gender roles when it comes to selecting careers,” she said.

To get more women to enter as well as help them grow in the investment field, will require a lot of effort and change in mindset.

RHL Ventures‘ co-founder Rachel Lau, supports having more women in senior positions. “I wouldn’t necessarily advocate quotas, but I can see why it might be helpful. Education and discussions help. Having more women role models help. You do get more inspired by people you can relate to,” she told DEALSTREETASIA in an interaction earlier this year.

Venture Capital Deals Led by Female Partners, 2010 – 2017 YTD (As at October 2017) 

Also Read:

DSA Summit: ‘Women founders have secured only 2.6% of total venture capital funding’

No glass ceiling for women in VC/PE, it’s just percieved so: Cradle Seed Ventures CEO Dzuleira

Having more women role models will help: Rachel Lau, RHL Ventures

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.