VCs, Founders, and the Performance Gender Gap

Abstract

VC-financed startups led by women perform worse than startups led by men. Do VCs influence this performance gap? To answer this question, I compare the gender gap in performance between startups initially financed by syndicates led by VCs with only male GPs and startups financed by syndicates led by VCs with female GPs. I find a much larger performance gap among startups financed by syndicates with only male lead GPs. I show this disparity is driven by differences in VCs’ ability to evaluate female-led startups. These findings imply that VCs contributed to the performance gender gap in startups.

Keywords: venture capital, gender gap, entrepreneurship, firm performance

JEL Classification: G24, J16, G11, G32