Gender Gaps in Venture Capital Performance

Abstract

We explore gender differences in performance in a comprehensive sample of venture capital investments in the United States. Investments by female venture capital investors have significantly lower success rates than investments by their male colleagues controlling for personal characteristics including employment and educational history and portfolio companies’ characteristics. The gender differences in investment outcomes are not due to female investors being less skilled but rather largely attributable to female investors receiving less benefit from the track records of their colleagues. Performance differences disappear in older, larger firms and firms with other female investors. This supports the view that formal feedback mechanisms and hierarchies are potentially useful in ameliorating the female performance gap.