Why are women getting just 2% of the $150 Billion in start-up capital?

Women nationwide have been shouldering the Covid burden: balancing children, playing teacher and juggling work – all from home.

The economic impact has taken a huge toll with a whopping 2.4 million women who’ve dropped out of the labor force since last February compared to 1.8 million men.  

But underneath this is a more alarming trend that will further impact women and us all.

Despite the economic impact women entrepreneurs have had, creating millions of jobs through companies like @NextDoor and @23andMe -- we continue to face an impenetrable wall to business funding.

 Here’s the hard truth: In 2020, despite the pool of venture capital growing to $150 billion from $130 billion in 2019, women’s share actually declined – to 2.3 percent.

That’s compared to 2.8 percent in 2019, which was an all-time high. Yes, you read that right: an all-time high.

The figures have barely changed since I was in Silicon Valley 20 years ago, one of the lucky ones to raise money during the early Internet boom.

The impact of being under-capitalized ranges from hiring women at below-market salaries to female founders foregoing compensation entirely as they bootstrap their companies.  

Why the paltry 2.3 percent share to women? There are multiple reasons – from the fact that just 12% of VC decision makers are women to old-fashion bias and human nature that we work and invest in people who look like us. 

We get that – but it’s time to pivot -- for real change and sustainable growth.

 While International Women’s Day is often celebrated in regions like Europe, this year, it’s incumbent upon us to reflect and re-direct.

We cannot afford to wait another few decades to see our share rise – or maybe fall – nor can our economy. 

Once funded, women “ultimately deliver higher revenue — more than twice as much per dollar invested,” a Boston Consulting Group study.

And women founders tend to hire more women – 2.5 times more women with at least one female founder and up to six times with more women at the top, according to a Kauffman study – a critical need given the pandemic’s job hit.

Speaking as one, women founders and leaders are also more sensitive to the lack of child care in America – and providing more flexible schedules so that women can work.

 Women are one of our nation’s most untapped sources for growth. Our own study based on data from the University of Connecticut found that while women make up just 22% of college venture competition participants, a whopping 51% of the ranking business teams – those placing first, second or third place – had a woman founder and 32% had a woman CEO.

This International Women’s Day, all companies and leaders need to make this day really count by investing in women --- to advance and sustain the next generation of leaders and visionaries.

On March 8th, we're holding the Girls With Impact & Live Nation International Women's Day Concert to move the needle - your attendance will not only give you a powerful entertainment event with some of today's hottest performers -- including the star of Hamilton -- but will help us equip 1 million girls.

Providing opportunities and funding is critical as is training and mentorship -- and not just in business school.

Starting early and investing in young women will not only unleash talent, but drive diversity, jobs, and innovation that will help America – and our state -- thrive in ways we have yet to unleash.

This International Women’s Day, it’s time to take a stand to help women -- not only to survive but to thrive in Connecticut.

Jennifer Openshaw is CEO of Girls With Impact, a nonprofit that operates the nation’s only live, online business and leadership program for young women.  Together with Live Nation, she is producing an historic International Women’s Day Concert to raise funds for under-resourced girls and provide a powerful entertainment experience from home.