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Women.VC: Female VCs match or exceed industry-average returns

The proportion of women VCs nationwide has dropped in the past two years, but their performance is on par with if not better than the industry average.

That’s one of the findings from Women.VC, a San Francisco nonprofit that has tracked the numbers of women in VC and found that the overall performance of their portfolio companies is 3.78x, ahead of the overall industry average.

The report is part of the group’s broader effort to raise and strengthen women’s profile in venture capital. And it comes as countless media reports have made clear that women are underrepresented in the field.

“We choose not to continue whining and boiling over number differences, but to show that women VCs are doing what any VC would be doing and doing it better than average in the industry,” said Renata George, co-founder of Women.VC and managing director of Zenmen Venture Fund.

“We aimed to prove with numbers and bring to the attention of limited partners that women venture investors are professional fund managers.”

Renata George
Renata George, co-founder of Women.VC and managing director of Zenmen Venture Fund.

Women.VC is releasing its initial findings exclusively with VCJ and plans to update the report annually.

In partnership with VCJ, Women.VC surveyed the industry and reported that as of June 30, 253 women were active venture capitalists nationwide. That’s 15 percent below the five-year high of 296 in 2014.

The report shows that almost 20 percent of active women venture investors work for corporate VC funds. And the group found that women VCs are more likely to be found in healthtech and life sciences than in software.

The list focuses on active partners who make investment decisions and does not include marketing partners, chief financial officers and similar non-investment roles.

George noted that the number of women investors has dropped over the past two years as many retired, changed roles within their firms or left VC to launch their own entrepreneurial ventures.

In addition, the group is preparing an interactive Google map that shows where all women VCs are based. And it profiles the women VCs (available on the website at, compiling their Twitter accounts and LinkedIn pages of each of the investors. Soon to be added: links to their blog posts.

Women.VC is also researching a similar list of women investors in Europe, which it plans to release in first-quarter 2017, as well as Asia, which is to be completed some time later.

“Women venture investors are great team players at leading startups, which should become obvious to entrepreneurs, considering the latest success stories,” George said.

Among the recent successes of women VCs are the billion-dollar sales of Dollar Shave Club and

Forerunner Ventures, founded by Kirsten Green, was the lead backer in Dollar Shave Club’s first round of funding in 2012. Cowboy Ventures, founded by Aileen Lee, was also an investor in Dollar Shave Club, which Unilever is buying for $1 billion.

Kirsten Green
Kirsten Green, founder, Forerunner Ventures. Photo by Oscar Urizar, Red Eye Collection, for VCJ.

Forerunner also invested in, which Walmart has agreed to purchase for $3.3 billion. The sales were announced in July and August, respectively.

“Forerunner and Cowboy are aspirational. It’s very cool what they have done and that they have women partners,” said Beth Engel, an early-stage investor at Dundee Venture Capital of Omaha, Nebraska. “The attention they’re bringing to the industry is great.”

Dundee, which focuses on investments located between America’s coasts, has five startups with female founders in its 25-company portfolio.

Beth Engel Women
Beth Engel, Dundee Venture Capital. Photo courtesy of the firm.

“Not sure if that number is high or low. What matters is we want to back the best entrepreneurs,” Engel said. “Just like I’m sure startups want the best VCs, whether it’s women or their male counterparts.”

In regards to calculating performance, the 3.78x return figure reported by Women.VC is certain to raise eyebrows. The average performance of venture funds is typically from 1x to 2x, based on a 2012 report from the Kauffman Foundation.

Similarly, Correlation Ventures two years ago released a study that showed about 65 percent of U.S. venture-return outcomes were 1x or less and that a little more than 25 percent were from 1x to 5x.

To calculate the performance of VCs in its database, Women.VC compiled a list of almost 3,000 portfolio companies for which women VCs were directors or led deals.

The group looked at research databases and publicly available information to find total amount raised and valuations for exited companies attributed to the investors from 2010 through July 2016, which preceded the sales of Dollar Shave Club and For investments that haven’t exited yet, the most recent deal valuations were used.

The group looked only at companies that were backed by the funds for which women VCs worked. So angel investments by women, as well as companies at which they were directors representing themselves or other organizations, were not included. The group also factored in portfolio companies that have gone out of business. Down rounds were considered, too.

The 3.78x return also was calculated before management fees, carried interest and other possible fund expenses. Women.VC says that even adjusted for these costs, the return multiple remains above 2x. Performance reports for individual investors on the Women.VC site will not be disclosed.

The point of the study, say Women.VC, is that the performance of women venture investors is on par with or better than the average in the venture industry.

No previous study had specifically measured the return performances of women VCs, George said. “For example, there are studies showing that companies with women executives perform better, but nothing about women VC. And working on this goal, we made other discoveries.”

Among the findings is that less than 15 percent of women VCs invest in software and more than 30 percent invest in healthtech and life sciences.

That fact doesn’t surprise Kathleen Behrens Wilsey, a longtime life-sciences entrepreneur, a former venture capitalist and a former chairman and president of the National Venture Capital Association. She said women have the skills and tendencies to make them great VCs, especially in life sciences.

Kathleen Behrens Wilsey
Kathleen Behrens Wilsey

“Women are more interested at problem-solving, and have a lower tendency of going with the status quo,” she said. “It’s a generalization, I know, but women are more apt to get to the bottom of a problem. That’s a great quality for a VC.”

At OpenView Venture Partners, the Boston-based expansion-stage venture firm, the focus is on B2B companies, and more men than women are in the software enterprise field, said Devon McDonald, a partner at the firm.

Devon McDonald OpenView Women
Devon McDonald, partner, OpenView Venture Partners. Photo courtesy of the firm.

But McDonald is seeing that change as more female engineers rise up and taking on leadership positions in the industry. “We’re seeing increasing diversity within our portfolio companies, as well as within our firm,” McDonald said.

McDonald, who has been with OpenView since 2009, early last year was named the first female partner in the firm’s 10-year history while she was on maternity leave for her second child.

Earlier this year, OpenView named Natalie Diggins its first entrepreneur-in-residence. And in June, OpenView announced its participation in the Pacesetters program at the National Center for Women and Information Technology. The Pacesetters initiative aims to recruit and retain more women in technical roles.

“Attitudes are changing as VCs are getting exposed to more women in VC and in their portfolio companies,” McDonald said.

Still, the numbers of women VCs are relatively low. At 253, women investment decision-makers at corporate and institutionally backed VC firms nationwide make up 4 percent of the total, Women.VC estimates.

Another finding of the Women.VC study is that 30 percent of all currently active women venture investors were or currently are founding partners.

That includes Green of Forerunner and Lee of Cowboy. It also includes, among others, Cindy Padnos of Illuminate Ventures; Jennifer Fonstad and Theresia Gouw of Aspect Ventures; and Susan Mason and Jodi Sherman Jahic of Aligned Partners.

Not yet on the list at Women.VC but soon to be added are Sara Brand and Kerry Rupp, co-founders and general partners of True Wealth Ventures, which recently launched and has yet to announce its first deal.

The Austin, Texas-based seed-stage firm is targeting a $20 million fund to back women-led companies with products and technologies in the consumer health and sustainable consumer sectors.

Brand, previously a corporate vice president with AMD and a former investment professional with Fremont Ventures, also co-founded 512 Brewery in Austin with her husband. Rupp is former chief executive and general partner of DreamIt, a Philadelphia startup accelerator and early-stage investor.

Brand said that Texas, where the firm plans to focus its investments, has an abundance of women-led startups that firms in California and in New York are overlooking.

She said she’s building a network of like-minded investors and cited the blog posts of Joshua Henderson of Springboard Enterprises as helping direct attention and resources to women investors, particularly as angel investors.

“We’re getting 100 percent positive feedback about our fund and our focus,” Brand said. “The timing is right for who we are and what we are focused on.”

Action Item: Visit the Women.VC website at

Illustration courtesy of ©iStock/gmast3r

Clarification: Women.VC reported that the overall performance of the portfolio companies of women VCs is 3.78x, calculated as if all the investments were in one massive venture fund. After management fees, carried interest and other possible expenses were factored, the net return multiple still remains above 2x, according to Women.VC. More information is available in the organization’s study synopsis.