femtech:brief #04: Investments and Female Founders
๐๐๐ฝ Hello and welcome to the fourth edition of femtech:brief. This week we discuss investments in femtech and female led startups.
We believe that investing in women is not only the right thing to do but that you can make a lot of money doing it
Jennifer Keiser Neundorfer, Co-founder, Jane VC
Female health has been ignored and underserved for a long time, but things have definitely started to change. Femtech is a growing field and investments are pouring in. VCs have also started to realize the opportunities in the female health space, bringing in $40 billion of investment in the first nine months of 2021.
The femtech space has historically been underinvested, and while that's a shame, it also means that there is a lot of opportunity and growth ahead
Laura Chambers, CEO of Willow
Investor Diversity: Do We Need It?
Investors look for transparency and diversity in the companies they invest, leading to varied perspectives to drive better decision making and stimulate innovation.
But is this the same case within the investor community? Only 12% of decision makers were women in 2019 and that inevitably impacts the investments in female founded startups or femtech sectors, i.e., thereโs been a decrease in VC funding for women led startups falling from 2.8% in 2019 to 2.3% in 2020.
But the happy news! This year, the funding to female founded companies is surging, raising more than $40 billion through September. This is also attributed to the fact that a growing number of female angel investors and general partners at funds are actively looking to support female founders. As of September, 15.4% of general partners at VC firms were women, up from 12% in 2019.
There are a few diversity focused accelerators to close this gap, for example:
Harlem Capital: one of the largest venture capital funds with a diversity mandate and the mission to support 1000 companies in 20 years.
Female Founders Fund: driving a leading source of institutional capital for female founders raising seed capital with over $3B in enterprise value.
Cleo Capital: though the firm has no specific investment focus, about 92% of its current investments are companies started by underrepresented founders.
XFactor Ventures: pre-seed and seed stage capital for companies founded by women.
Jane VC : As their home page says, Jane VCs invest in the founders of the future, more women, more diverse. And the best part? they want founders to cold email them to make the process as transparent as possible.
According to Frost & Sullivan, the global femtech market is expected to reach $1.15 billion by 2025.
Femtech Accelerators
Female entrepreneurs are growing with the number of femtech initiatives but do we have enough female investors who understand this opportunity?
Interested in femtech? These are some accelerators you should check out:
Femtech Lab: The global ecosystem of startups, experts, and investors in womenโs health and wellness.
Eve : Promote femtech startups in Israel.
Tech4eva: A 9 month Swiss-based FemTech start-up acceleration program for companies developing innovative solutions to improve technologies relating to womenโs health.
Recent Investments in Femtech
Flo: UK based Period tracking app company raised $50 million Series B funding, now valued at $800 million.
Maven Clinic: Became the first femtech unicorn following a $110 million round in August 2021.
๐ Bonus read
Diversity in VC proven to yield better results
Diversity can come in various forms, but racial and ethnic diversity are especially proven to "drive diverse opinions and insights which yield better results."
Sarah Kunst, Director at Cleo Capital Managing
๐ก Did you know?
Female VC partners consistently back more female founders across sectorsย
Women VCs tend to invest twice in female led startups than their male counterparts. Having more women VCs is important to drive increased investments in female-led and diverse startups.
At Kauffman Fellows, they believe the reasons for this may include women having personal experiences that male investors would not, which in turn helps them identify overlooked problems and understand their market size.
Thatโs it, folks! Thanks for joining us this week. And, for those celebrating, hereโs wishing you a very happy Diwali!