Why do women shy away from being investors?

Where are the Women Investors?We have a huge problem folks… We simply don’t have enough women investors in hi-tech and startups as a whole around the globe. Why not?

Let me start off by saying that ‘women’ are the larger demographic ‘purchasers’ globally. Women are constantly making purchase decisions and very involved in making global ‘buy’ decisions. I was recently quite taken with the statistic that the largest percentage of the wealthiest (self made) women in the world  are in China, in real estate. Women are highly educated, earn significant incomes and have access to wealth. So, the question is why do women shy away from investing in startups globally? This is a question that I very much want to hear your thoughts on and explore with you.

I am an angel investor in hi-tech startups in the US, Europe, India and hopefully soon in China. For the last 5 years I have joined and currently belong to a number of angel investment consortiums around the world.  I also invest individually in startups of various stages. The angel consortiums I am a member of range from 170-270 members in each city/country and my colleagues are active investors who are either still in the tech industry of have recently retired, but very interested in technology. In addition to investment funds, we also bring a large number of highly skilled individuals to help the startup. The number of women in each consortium in no more than 2-3, and I am one of these women. That is a ridiculously low percentage! The question is why? When we do deals, we form due diligence teams and I have not had a woman on a team with me, ever!  These numbers are staggeringly low! A few examples of the groups I belong to include Alliance of Angels in Seattle, and the Indian Angel Network, in India.

To overcome the challenge in various cities women have decided to have female only investment groups, such as Golden Seeds and Seraph. Highly talented women who opted out of the larger consortiums to only work with women colleagues.  These are great women and bring a lot to the table. I have attended the lovely meetings, however, not sure I see the logic why we should form our own investment groups??? The number of investments are smaller, deals take longer, and frankly why separate something that should be interconnected? I am all for women getting involved and greatly support and admire these orgs, but ask the hard question: what is there to be gained in separating off into splinter groups???

Net-net in almost all deals which I have been involved in, I have been the only female investor (with the exception of 1-2 times).  In addition to investment we also sit on advisor boards and board of directors. You already can guess where this is going: I rarely have women colleagues on the advisory boards and to date have not had a single female on any of the boards I serve on. Something that not only greatly distresses me, but a fact we need to be aware of and actively try to change. We need to go to the core of why there are not enough women on boards globally?

At the beginning, there was a period of adjustment and clearly some of my men colleagues had not had a female team member before. Upon working together, there has never been an issue. So, the question is why do women stay away? I need your help in thinking through this. I will propose a few hypotheses to get our discussion going:

  1. Risk:  The nature of angel investing in pure risk. You see an opportunity, early stage and you have to make a decision to take a big risk. Risk taking is not something that is comfortable for many women. It is for this reason that while we have highly talented women in technology, we have very few founder entrepreneurs, as that is ALL about risk.
  2. Comfort:  Not terribly comfortable for women to be with groups of all men, where you are often the only woman. Either during an investment or while on the board of directors.  For some women this is not a pleasant environment, but it is reality.
  3. Intimidation:   During the investment period, board meetings and at the time of due diligence for the investment, “things” can become highly intimidating and contentious. Emotions and opinions run high and you need to have the resolve to defend your position, or take a strong position despite the opposition. Specially on boards this is an issue, where you have to stick to your opinion and what is right, even when your fellow board members relentlessly try to convince you otherwise. Tons of good energy and intimidation going on, something women are not super interested in.
  4. Reassurance:  By definition angel investment is pure risk. Risk does not bring with it guarantees and reassurances, instead it brings adrenaline and possibility. Women on average are extremely good at being very thorough and in completing tasks, but not as good with taking open-ended risks with no reassurances.
  5. This is not personal:  As women we tend to take things personally. This is not personal rather it is a high risk, great reward game with tons of unknowns. Emotions run high and it requires that you not take interactions personally. It is about business and not about you (you being the female here). This separation is often a problem for us women. Someone may not like your ‘idea’, it does not mean it is about ‘you’, and frankly none of it matters, it is about the ‘deal’ and it is not ‘personal’.
  6. Networking:  Women are not always comfortable in highly active and broad scale networking, pretty much with men only, which is required to build these new relationships. This may be another contributing factor?!
  7. Other:  There are many others which I would love to hear from you on.


Women are extraordinary multi-taskers along with so many other qualities that it would be many blogs to discuss all the great assets that women have, however, there are clearly reasons that globally women shy away from investment risk, either as angel investors, as VC’s or other.  It is not about technical competency, qualifications or experience. It is more about our inclination as women to do what we are comfortable with, and not move out of our comfort zone.

It is exactly the lack of desire to move out of our ‘comfort zone’ which has disabled so many women from taking risks. I am not here to say that being an investor is ‘the’ thing to do, absolutely not. I am simply exploring why there are so few of us around the table.  Fact is that today we have very few women investors, few leading women VC’s, very few VC funds founded and run by women, and very few women entrepreneurs (that is the topic of my next post).

And here I will be honest folks. As the very small female minority in these forums, boards, investments, I have not experienced bias from my male fellow investors. Yes, some of them if they are older, may not have worked with a female in my capacity before, however, once they see the drive, energy and active participation, there is never an issue.  There is no ‘inclusion’ problem, or any reason that I can justly say, men exclude women. In fact while there are forums that are just for women, men forums are open to women!  So perhaps we are excluding men. And if so, why?

The fact remains that if we only work with female investors focused on what is comfortable to us, we are lowering the bar and creating an exclusion zone which serves no purpose, other than some temporary satisfaction on our part that we are doing the right thing. Investment is an aggressive, active and global effort, and if the opportunity is hot, there are many groups fighting to invest, so why not gear up together rather than separate off?

I want to hear your thoughts fellow readers:  Why are there not enough women investors and why do we shy away from opportunities?  I am listening…

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