Can Women Founders Out-Pitch Bias?
Here are some sobering stats: the rate of women’s entrepreneurship has increased by 30% in Canada in just the past decade, and the number of women-founded start-ups with a valuation of more than US$1 billion has almost doubled since 2019.
But even with more women and gender-diverse founders launching and leading impactful businesses—and despite the fact that their businesses perform 63% better than those of their male counterparts—they receive only 4% of all venture capital funding within the country.
It doesn’t make sense to us either. That’s why we’re dedicated to rectifying this imbalance.
In order to access funding from venture capitalists (VCs), women founders need to pitch their businesses to them. And though the barriers faced by women founders certainly don’t stop in pitching rooms, the challenges faced within them are some of the most significant in preventing them from launching and scaling their businesses.
As Forbes points out, women have $32 trillion in spending power. But when women also make up less than 20% of partners at Canadian VC firms, we end up with less funding to women-led businesses and, in turn, fewer products and services that meet the needs of this underserved market.
Male investors tend to find the pitches of women founders to be less relatable, which can blind them to the true value and potential of their businesses. While more women VCs translates to more funding for women-led businesses, we still have a long way to go in toppling the systems that hold inequality in place.
Women founders are not to blame for the systemic barriers that have held them back from achieving success, but given the current reality of pitching rooms, they may be asking “what can I do to receive critical funding?”
Focus on the problem and the solution
If your solution is targeted towards women, male investors may not relate to or resonate with it. Expect this to happen, and take time to clearly outline the problem or pain points that your target market is facing. Provide specific examples, statistics, and anecdotes that speak to the significance of the problem and the market demand that exists for the solution your venture puts forth.
Walk investors through the specifics, and highlight how and why you stand out amongst your competitors.
In addition to needing to understand the problem and solution you’re presenting, investors will also need to see the potential for scalability. Plan to discuss your growth strategy and plans for expansion in detail.
Identify and address potential concerns head-on
60% of the time, investors choose to invest in pitches done by men over women, even when the content of those pitches is the same. Bias runs deep in pitching rooms, and investing in women-led companies is still seen as “risky.”
Know your audience and try to anticipate and prepare for concerns and objections in advance. Research shows that investors tend to ask men more questions about potential for gains, and women more questions about potential for losses. When this happens, the conversation can maintain a negative focus on risks—which can deter investors.
By identifying and addressing potential concerns head-on, you can help steer the conversation and spend more time focusing on the promotion of your business and the opportunities it will seize.
Here are a few examples of questions you may want to prepare for:
What are the key risks associated with your venture, and how do you plan to mitigate them?
How do you plan to capture market share and differentiate from your competitors?
How will you and your team adapt to changes in the market or regulatory environment?
How do you plan to address operational challenges and scale?
What is your strategy for retaining customers?
Visualize and reiterate key takeaways
One of the greatest challenges in developing a standout pitch is condensing your business idea, communicating it with clarity to an audience who may not understand the problem you’re solving, and differentiating your venture from others.
When you have so much to go over, some of the most important details can get lost in the mix.
Use visual aids like slides, infographics, and charts to help investors understand and retain important information, and conclude your pitch by summarizing the key takeaways. Reinforce your value proposition and the specific reasons for why they should choose to invest in your venture.
Don’t just focus on the impact you’ll have—but communicate the opportunities that are ahead.
Practice, refine, and practice again (and again)
We know we don’t need to tell you to practice your pitch, but when you’ve found yourself facing unfair circumstances, imposter syndrome can flare up and knock your confidence. Understand that this can happen to anyone, and remind yourself that you are qualified, competent, and worthy of being in the position you’ve worked hard for.
Give yourself plenty of time so that you can seek out feedback from mentors, advisors, and peers. This will ensure you have space to apply any constructive criticism and then practice your refined pitch.
By practicing your pitch again and again, it will be easier to maintain your confidence in difficult environments—helping you to enter that room with a presence that exudes the passion and enthusiasm you have for your business.
Investors need to believe in you, so set an example for them.
Don’t settle for the status quo
While you can use these tips to develop and deliver an incredible pitch, women founders shouldn’t have to try to out-pitch the bias that they’re being met with.
We need to address systemic barriers by addressing the systems that have enabled them to persist. By uniting change-driven investors with ventures that are led by women and gender-diverse founders, The51 is dedicated to making Canada a centre for women-powered capital.
It’s a future that benefits everyone, and we’re proud to be driving it forward.