Women-led deep tech startups attract under 5% of venture capital

Key Concepts

• Venture Capital (VC) Funding Gap: Disparity in investment received by women-led startups compared to male-led ones.
• Deep Tech: Technology-intensive sectors requiring significant scientific and engineering expertise.
• Angel Investor: An individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity.
• Investor Collective: A group of investors who pool resources and expertise.
• Deal Diligence: The process of investigating a potential investment opportunity.
• Exposure Therapy (in investing): The concept of providing visibility and examples of successful individuals to inspire others.
• Support System (for female founders): The network of personal and professional assistance crucial for women balancing entrepreneurship and family responsibilities.
• Board Diversity: The inclusion of individuals from diverse backgrounds, including gender, on company boards.

Venture Capital Disparity and Bias

Globally, women-led startups receive less than 5% of venture capital funding. In Southeast Asia, this figure drops to approximately 2% of deal value and 5% of the total number of deals for all-women founding teams. This disparity extends to innovation, with only about 18% of named inventors on international patents being women, and this gap widens significantly in deep tech fields.

Alexandra Vidyuk, a physicist turned investor, shared her personal experience with bias. She noted that in many professional settings, she was the only woman present. Early in her career, she was often mistaken for a "comps or marketing lady" rather than a General Partner leading deals. While this bias can be subtle, Vidyuk has learned to leverage it to her advantage, attracting more attention, insights, deals, and talent due to her distinct presence.

Barriers to Women's Participation in Deep Tech

Despite the talent being present, family duties and societal risk aversion continue to sideline many women from actively participating in deep tech investment or founding startups. The question arises: how can more women be encouraged to invest in deep tech or establish new ventures?

Epic Angels: A Solution for Access and Comfort

Epic Angels, based in Singapore, positions itself as Asia's largest female-only investor collective. A common misconception is that they exclusively fund female founders. However, their focus is on being "100% female investors." They clarify that they are not feminists or activists but aim to create access and foster a comfortable environment for women to learn and invest. They believe women make excellent angel investors and provide a space where they can ask questions without insecurity about what others might think. This all-women environment has proven effective.

Epic Angels reviews 100 deals per month, opening data rooms and shortlisting four for group diligence conducted online across 45 countries. Hester, a proponent of this approach, argues that women do not lack talent but rather visibility and access to understanding how venture capital works.

The Power of Exposure and Role Models

Cameron Priest, a successful tech founder and investor who exited Trade Gecko, supports this idea. He emphasizes the impact of seeing individuals who "look, feel, and put their pants on one leg at a time, just like you" achieving ambitious goals. This realization, he states, unlocks a belief in oneself: "if they can do it, I can do it." He likens this to the Steve Jobs quote, "everything in this world made by someone no different from you." Priest believes that "getting exposure" is crucial, acting as "exposure therapy" to what ambitious success looks like.

Founder Spotlight: Sarah's Journey

Founders like Sarah exemplify why this access is vital. A chemical engineer and nanotechnologist, and a mother of three, Sarah developed a startup focused on carbon quantum dots, a more environmentally friendly alternative to toxic nanomaterials. She began her entrepreneurial journey when her youngest child was seven, finding it manageable because she had a strong support system at home. Sarah highlights the critical importance of a robust support system for female founders. She believes that if the business ecosystem is empathetic to the challenges women face and willing to support them through different life phases, more women will succeed in building businesses.

Government Initiatives and Future Outlook

Governments are also playing a role in driving change. Singapore, for instance, now mandates listed firms to set board diversity targets. Women currently occupy approximately a quarter of the top 100 board seats. A new workplace fairness bill prohibits discrimination, and the Startup SG Equity initiative has boosted deep tech co-investment by $337 million USD.

The transcript concludes with a powerful statement about the potential impact of increased female investment: "If 1 million women invest 10K, that moves 10 billion and that starts to become a real river." This highlights the significant financial power that could be unlocked by greater female participation in investment. Ultimately, women are reshaping the landscape of who builds deep tech, from investors and inventors to mothers.