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The venture capital industry has a severe gender inequality problem. Only at many VC firms, and most firms still don鈥檛 have any female partners. of all partners. This is key because the founding partners primarily control a firm鈥檚 investment decisions.

One of the results of this lack of gender inclusion in asset management firms is equally abysmal VC funding to female-led startups. In 2020, just 2.3 percent of VC investment went to female-led startups, 附近上门 data shows.

The pandemic exacerbated this with a 27 percent decrease of venture funding going to women-led startups in 2020.

This lack of investment in women-led VC funds and startups has many reverberating repercussions throughout the U.S. and global economy.

Less representation = less innovation = less alpha

When half of the population is excluded from VC funding, there is an enormous loss to address half the world鈥檚 pain points, a missed chance to deliver products and services to a market with enormous spending power, and thereby a failure to tap into massive pools of alpha.

Today, of total U.S. household financial assets are controlled by women. By 2030, women will control about $30 trillion in financial assets that the baby boomer generation possess鈥攖his substantial amount could potentially equate to the annual GDP of the U.S.

Having more diversity in boardrooms, C-suites, funds and startups is a way to incorporate diverse POVs, and include a wider experience base and intellectual capital.

Lost revenue

This glaring gender imbalance represents significant capital and returns being left on the table. For example, valuations for startups with at least one female founder are than for those with all-male founding teams.

According to an , compared to the market average, female CEOs and CFOs produce remarkably better stock performance. Further, the study indicates, 鈥淚n the 24 months post-appointment, female CEOs saw a 20 percent increase in stock price momentum.鈥�

A found that when women pitch their ideas to investors for seed capital, they receive substantially less than men. However, companies founded by women ultimately deliver 2x more per dollar invested.

Employment impact

The lack of gender equality and the correlated funding gap in female-led startups drastically impacts overall jobs for women. Startups with a female founder employ while companies with both a female founder and a female executive hire 6x more women.

Additionally, numerous studies . Higher gaps in labor force participation rates between men and women commonly result in unequal earnings between genders, thus creating and exacerbating income inequality.

Company culture and responsibility

suggests that gender-inclusive leadership is associated with increased corporate social responsibility. Moreover, there鈥檚 a significant correlation between gender diversity and for all employees, not just women.

Increased gender inclusion is linked to improved risk management through the reduction of controversies concerning income inequality, sexual harassment and equal opportunity litigation. In the boardroom it has also been found to, with gender diverse boards committing fewer financial reporting mistakes and engaging in less fraud.

Time for inclusion is now

It is long past due for the asset management industry to more directly represent the diversity of people in our society and world. We must collectively decrease the outdated habits and unconscious bias that prevent institutional investors from recognizing the immense talent and potential of ideas presented to them.

is CEO and founder of , an exclusive ecosystem and marketplace designed for GPs and LPs to expand investment opportunities for women and people of color.

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