Venture capital has a female problem; at least that's what the numbers say. Funding to startups with a female founder remains low, with only 2% of funding going to African startups with an all-female founding team.
Having experienced first hand the difficulties that female entrepreneurs face when raising capital, June Angelides, founder of Levare Ventures is keen to reduce the gap but notes that the problem often begins while pitching.
“Unfortunately, as women, sometimes we sell ourselves short. I'm guilty of it as well. It's something I work on on a regular basis to speak up, to be more confident, but the numbers don't lie in that, men are asking for more versus women,” she shared with Techpoint Africa.
For many, the solution to increasing funding to female startups lies in getting more women into decision-making roles at venture capital firms. The logic is simple: investors back founders that look like them and since the majority of VC firms have male partners, more female partners will even out the scores.
But while there has been a gradual increase in the number of women making these investment decisions, that has not necessarily translated to more funding for female founders.
This study found a negative correlation between female representation in VC firms and funding to female-led businesses. According to the study, "adding one additional female senior venture capitalist into VC firms results in about 0.46% decrease in proportion of woman-led businesses."
One reason for this outcome could be that women in male-dominated spaces tend to defer to the men and distance themselves from women in less powerful positions. The study, however, notes that where trust exists between the male and female partners — usually because they've worked together previously — this can be reduced.
Other studies have suggested that all-male investment panels tend to focus on how to prevent losses when being pitched by startups with some female representation.
With bias, even if unintentional, playing a major role in investment outcomes, Angelides argues that improving funding to female founders will depend on how much investors are willing to check their bias.
Written by Omoruyi Edoigiawerie, a seasoned startup attorney with over a decade of experience. Learn more.
"Honestly, the easy path is to keep investing in the types of founders we know can build great things because of pattern recognition. We're seeing so many decks day in, day out, so it's easy to kind of pigeonhole certain types of founders based on experience, but the reality is, you need to speak to the founder because very often, the deck doesn't tell the whole story. That's what I try [to] unpack when I speak to a founder. I want to know the backstory. I want to know their motivations. And I feel like not everyone communicates this very well on a pitch deck."
The idea of having investment quotas has also been floated in certain quarters. While she thinks some pressure should be put on VCs, she notes that investors also need to cast their net wider and make sure they get in front of as many founders as possible.
An unconventional path to venture capital
Born in Lagos, Nigeria, Angelides spent much of her childhood in the bustling neighbourhood of Yaba before moving to the United Kingdom at 16 for her A-levels and subsequently studying for a degree in economics at University College London.
Coming from a family of media entrepreneurs — her uncle Ben Murray-Bruce founded the Silverbird Group in 1980 — she dreamt of a career in media and entertainment, but while at a concert with friends, she got wind of an opening at Thomson Financial (now Thomson-Reuters), eventually landing a role as a market analyst.
The Reuters acquisition was completed after she joined, and she attempted to join the entertainment desk a few times. When Silicon Valley Bank launched in the UK, she was headhunted to join its venture debt team, where she would spend the next five years working with early-stage and growth-stage entrepreneurs.
Unsurprisingly, she caught the entrepreneurial bug, and after returning from a maternity leave, decided to try her hand at building a startup. That didn't go too well as she soon discovered how expensive it was to hire technical talent. Undeterred, she decided to learn to code but ran into a problem — there was no coding school that catered to the needs of mothers.
In response, she founded Mums in Tech, a coding school for mothers interested in making the transition to tech roles.
Her two years running the business showed how difficult fundraising for a woman could be, and when she left the business in 2017, she decided to do something about it. Today, she invests in startups in Europe through Samosa Ventures and Africa through Levare Ventures and continues to advocate for more investments for under-represented groups.
Building a personal investment thesis
Angelides' varied experience has helped to guide her investment philosophy. During the COVID-19 pandemic, she was forced to homeschool her kids, leading her to search out tech tools that could make it easier.
With limited funds at Mums in Tech, she transformed tech company meeting rooms into classrooms equipped with crèches. Customer acquisition required unconventional strategies. She infiltrated Facebook groups and online communities where mothers gathered, building trust and spreading the word organically.
Running 12 cohorts and teaching over 250 mothers over three years, Angelides learnt that resilience and adaptability, qualities she looks out for while analysing investments, are key for startup founders.
Investing in African startups
Having spent much of her professional life working in Europe, her investment journey has naturally focused on European startups. A trip with Google in 2019 opened her eyes to the investment opportunities on the continent.
“I'd been to Nigeria with Google in 2019 to be a part of their demo day, and this was actually the cohort that PiggyVest was pitching at. And I was like, Oh my goodness, I need to pay attention to home. So many incredible startups were coming out of Nigeria and Africa at large, and I thought, 'Well, I want to spend more time on the continent. I want to go home. I want to really play a role in developing the ecosystem.'"
In 2022, she founded Levare Ventures, an angel syndicate that invests between $25,000 and $100,000 in ecommerce, fintech, healthtech, B2B SaaS, and future-of-work startups. It now counts startups like Chowdeck, LaborHack, and CDCare as portfolio companies.
Investing in Africa, however, comes with its own set of challenges. Infrastructure gaps, regulatory hurdles, and currency fluctuations make scaling across borders difficult for startups. Yet, Angelides sees these challenges as opportunities.
Her first investment in Africa, Raenest, epitomises her philosophy of investing in startups that don't just provide financial returns but have a major impact on the continent. The platform helps freelancers in Africa get paid quickly for international gigs — a problem its CEO, Victor Alade, experienced firsthand.
"Geegpay makes it possible for them to participate in jobs around the world. If we have more people like this across the continent, they're able to give back; they're able to create more jobs locally because they're able to spend in shops, they're able to patronise restaurants, they're able to afford housing, and they can send their kids to school," she notes.
Ahead of the new year, she shares that Levare Ventures intends to do more work with universities in Africa to guide more students towards entrepreneurial paths.
"We have people with great ideas. I think many of them haven't really thought about entrepreneurship, and my vision is to encourage them to team up with commercial people."
She's also exploring ways to make healthcare more affordable and accessible to Africans. Additionally, her interests extend to the entertainment sector and the creator economy, where she's eager to explore innovative ways to empower artists and creators.
