Rachel Whittaker, sustainable investing strategist at UBS Wealth Management's chief investment office said: "Our research indicates that gender-diverse companies tend to outperform on various profitability measures. "We believe these findings support approaches to gender lens investing that take into account diversity at all levels of the organization as well as in leadership positions."
It turns our that one reason for the low percentage of dollars going to companies with women CEO's and executives is that there are so few women VCs. VC firms with female partners are more than twice as likely to invest in companies with a woman on the management team (34% of VC firms with a woman partner versus 13% of VC firms without a woman partner), according to Diana Report Women Entrepreneurs 2014: Bridging the Gender Gap in Venture Capital. The research was conducted by Babson. With women making up just 11% of investment decision-makers, according to the NVCA-Deloitte Human Capital Survey Report, no surprise that women entrepreneurs aren't getting funding.
“‘Gender-neutral products’ are actually, by default, for men,” says Melissa Cullens, chief design officer, noting that 86% of investment advisers are men who think and invest, well, like men. Meanwhile, 73% of women are unhappy with the financial services industry, in spite of the fact that women control $5 trillion in investable assets. Gender-neutral investing tools fail women because they don’t account for differences in how much women earn, or when they earn it.
Earlier this year, National Australia Bank raised 500 million Australian dollars ($384 million) from investors keen to promote gender equality at work, and get a healthy return on their cash. It was the country's first gender bond. "It's not often that you see capital markets and diversity come together," said Eva Zileli, head of group funding at National Australia Bank.
Social Capital evaluated nearly 3,000 companies during its private beta and committed to funding several dozen across 12 countries. An interesting byproduct of the data-oriented approach was that CEO demographics skewed 42% female and majority non-white. (For context, female founders received 2.19% of venture capital funding in 2016.) Social Capital CEO Chamath Palihapitiya called the 42% data point “simply fucking awesome.”
Wood hopes to bring in more women and first-time investors by lowering the barrier to entry. The Helm’s annual membership fee is $2,500 and the minimum investment is $50,000—minimums at most existing VC firms are at least double that. It will also provide community members with direct access to portfolio companies, social events, financial education as needed, and regular content about female entrepreneurship. Wood calls this “experience investing.”