OUR FIRST BILLION GLOBAL IMPACT REPORT

BEYOND THE BILLION® ANNOUNCES THAT OVER $600M HAS BEEN DEPLOYED BY ITS PARTNER FUNDS IN TWO YEARS

OUR FIRST BILLION GLOBAL IMPACT REPORT

BEYOND THE BILLION® ANNOUNCES THAT OVER $600M HAS BEEN DEPLOYED BY ITS PARTNER FUNDS IN TWO YEARS

"There is growing recognition in the venture industry that great ideas and successful entrepreneurs can come from anywhere, and the best returns are achieved with diverse teams.  As importantly, this recognition extends to the LP community where we consistently hear that diversity within portfolios is now a part of their diligence process. We are excited by the progress made and remain committed to working toward the goal of a private investment industry that more fully reflects the breadth and depth of innovators and risk-takers in our country.”

Kay Parry

Managing Director, Venture Banking, Pacific Western Bank

BEYOND THE BILLION® ANNOUNCES THAT OVER $600M 

HAS BEEN DEPLOYED BY ITS PARTNER FUNDS IN TWO YEARS

Launched to address the gender venture funding gap where female founders were only receiving 2.2% of venture capital, the campaign was the first-of-its-kind global capital commitment campaign focused on gender-lens investing, a bold measure to inspire venture capitalists to pledge to invest more into female-founded companies. 

This report, published with support from Pacific Western Bank, Mastercard, Bank of America and Motley Fool Ventures, found that the consortium deployed 61% of their pledged amount in just two years into almost 800 companiesnine of which were recognized as unicorns, with the remainder expected to be deployed by 2023. An additional analysis from a sample size of 479 of the deals tracked by the consortium’s data partner, PitchBook, showed that these portfolio companies with female founders, have gone on to raise more than $4 billion within the timeframe of the 2018-2020 pledge campaign.  This report presents both qualitative and quantitative data to specifically answer three core questions:

  • How impactful was 'Our First Billion' campaign? That is, how much of the $1 billion pledged by 86 venture funds was deployed by December 31, 2020, and what were the trends observed from such data?
  • What can GPs do to better fuel women-led innovation?
  • What can LPs do to better back GPs who over-index into female founders?

"There is growing recognition in the venture industry that great ideas and successful entrepreneurs can come from anywhere, and the best returns are achieved with diverse teams.  As importantly, this recognition extends to the LP community where we consistently hear that diversity within portfolios is now a part of their diligence process. We are excited by the progress made and remain committed to working toward the goal of a private investment industry that more fully reflects the breadth and depth of innovators and risk-takers in our country.”

Kay Parry

Managing Director, Venture Banking , Pacific Western Bank

BEYOND THE BILLION® ANNOUNCES THAT OVER $600M 

HAS BEEN DEPLOYED BY ITS PARTNER FUNDS IN TWO YEARS

Launched to address the gender venture funding gap where female founders were only receiving 2.2% of venture capital, the campaign was the first-of-its-kind global capital commitment campaign focused on gender-lens investing, a bold measure to inspire venture capitalists to pledge to invest more into female-founded companies. 

This report, published with support from Pacific Western Bank, Mastercard, Bank of America and Motley Fool Ventures, found that the consortium deployed 61% of their pledged amount in just two years into almost 800 companiesnine of which were recognized as unicorns, with the remainder expected to be deployed by 2023. An additional analysis from a sample size of 479 of the deals tracked by the consortium’s data partner, PitchBook, showed that these portfolio companies with female founders, have gone on to raise more than $4 billion within the timeframe of the 2018-2020 pledge campaign.  This report presents both qualitative and quantitative data to specifically answer three core questions:

  • How impactful was 'Our First Billion' campaign? That is, how much of the $1 billion pledged by 86 venture funds was deployed by December 31, 2020, and what were the trends observed from such data?
  • What can GPs do to better fuel women-led innovation?
  • What can LPs do to better back GPs who over-index into female founders?

Key Insights

#Insight 1

Limited Partners

LP investors, even those committed to investing in diversity, must re-engineer their processes to increase the diversity of their portfolios. A mismatch exists between legacy LP structures and expressed goals to diversify portfolios showing that systemic bias requires systemic solutions. Despite the best of intentions to back both diverse fund managers and those who invest into diversity, LP investment profile constraints such as check size and track record requirements hinder the ability of emerging fund managers to attract capital.

Insight #2

General Partners

The issues faced by general partners (GPs) mirror the issues of LPs with systemic barriers being a core. 

There is no “pipeline problem” when it comes to funds seeking female founder dealflow.

Rather, fundraising is by far, one of the biggest challenges faced by fund managers investing into female founders. 

Almost half  of all funds (48%) that were part of this pledge campaign shared how they greatly underestimated what it took to raise their funds; especially if they were deemed to be within the Emerging Manager category (which many LPs define to be Funds I,II, or III). Despite the fund manager’s experience in brand name firms and robust deal flow of female founders, many were hindered from timely deployment due to delays on the fundraising end. 

Insight #3

Female Founders

Fundraising while a female founder, is still an experience mired in systemic bias. Female founders interviewed shared how they had experienced biased lines of questioning and noted how the vast majority of investors’ examples of past patterns of success were almost exclusively referencing male founders. They were encouraged by encountering investors who recognized the opportunity to invest in female founders as a chance to improve their returns and who had committed to this as part of their investment strategy.

 

Diverse fund managers tend to allocate more capital to women and diverse founders than non-diverse allocators.  At Bank of America, the diversity of our investment managers and whether they allocate capital to women and diverse founders is an important focus.  Our clients, both individual and institutional, are demanding greater transparency about how their capital is being allocated, and we are committed to meeting their needs. We have incorporated diversity, equity and inclusion criteria into our  investment conviction in the managers in whom we entrust client capital.

Anna Snider

Managing Director and Head of CIO Due Diligence, Bank of America

Our fund continues to benefit from the talent and success of our women-led companies. We’re proud that in total, we have placed approximately 35% of our invested capital into their businesses and continue to reap the returns. In 2021 alone, public companies acquired two of our women-led startups. These acquisitions underscore the value being created by our founders and their ability to grow world-class technology companies.

We believe there are still a large number of highly qualified, VC-backable, female-run companies seeking funding and we look forward to working with them and creating partnerships to generate outstanding returns for our Limited Partners, and help make our portfolio reflect our best vision for our future.

Ollen Douglass

Managing Director, Motley Fool Ventures

It is not news that businesses that incorporate diversity throughout their business, from senior leadership right through to entry level roles, outperform those that don’t. 

And this is why at Mastercard, we’re committed to supporting 25 million women entrepreneurs by 2025 as part of our broader financial inclusion goal. We help women entrepreneurs get paid, get capital and get digital, because they drive global growth and innovation. As part of our ongoing investment into and support of women innovators and their funders, we are the lead investor in Astia’s early-stage venture fund, a BTB Partner Fund, as well as of BTB itself, aimed at addressing the extraordinary disparity in funding for companies that include women in founding or executive roles. 

Ann Cairns

Executive Vice Chair, Mastercard

 

MEDIA CONTACT:

Emmie Twombly 

Media & Communications

media@beyondthebillion.com

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