Today, I’m proud to announce that Microsoft’s corporate venture fund, M12, is joining forces with EQT Ventures and SVB Financial Group to launch the Female Founders Competition, a global startup contest to identify top female talent and accelerate access to capital for women entrepreneurs.
We’ve all heard the long odds facing women founders in tech. Last year, female founders received just 2.2 percent of total global venture capital funding, and only 17 percent of all startups have at least one female founder, despite the fact that gender diversity on executive teams correlates with greater profitability and value creation.
I’ve experienced this painful data up close. Over the course of my career, I’ve spent thousands of hours in pitch meetings, often as the only woman in the room. I still can’t hold back a smile when a woman founder walks through the door, because I know the obstacles she’s overcome just to get there.
But most importantly, I also know the opportunity she represents. Study after study shows that investing in women founders returns significantly more than the market average.
When we founded M12 two years ago, we knew we had a special opportunity to build our team from the ground up, and we set out to make diversity a competitive advantage. In an industry where only 8 percent of investment partners at the top firms are women, we worked intentionally to build a team that looked and thought differently from the rest – not only with diversity of gender and ethnicity, but of background, education, expertise and network. We believed it would make us stronger, help surface ideas and opportunities that the rest of the industry was missing, and ultimately – we hoped – lead to a more diverse and profitable portfolio.
While I’m proud of the team we’ve built and progress to date – women make up nearly 40 percent of our investment team – these efforts are not yet reflected in our portfolio, where only about 8 percent of our founders are women.
We want to change that. We want to do more. So, we’re trying something new.
Last year, we launched our first global startup competition, casting a wide net to uncover high-potential investments in artificial intelligence. We thought that by extending the search beyond our traditional network, we’d surface a companies and entrepreneurs not typically on our radar. We did; we found four incredible companies, proving there’s a ton of great potential out there that doesn’t have an easy pathway to funding, even more so for women.
Through the Female Founders Competition, we are asking startups with at least one woman founder to apply for the chance to win $2 million in funding from M12 and our VC partners, EQT Partners and SVB Financial Group, as well as getting access to technology resources, mentoring and legal counsel.
Applicants will compete for the opportunity to participate in a live pitch-off this fall, where they will present their ideas as a solution that is solving a critical business problem. Up to 10 finalists across the regions of North America, Europe and Israel will be chosen as contenders, and two winning teams will receive equal prizes, totaling a combined $4 million in venture funding.
At Microsoft, diversity and inclusion are central to the culture we’re building. To achieve our mission to empower every person and organization on the planet to achieve more, we need to be a truer reflection of the planet we serve. While our efforts are a story of steady progress, we know there is more to do to become a more diverse company.
But this is about more than just Microsoft.
The future of the tech industry is still being written, and we know that many of its most important authors won’t be those of us in the Fortune 500. They’re the startups with big visions and the founders with bold ideas. If we’re truly committed to becoming the inclusive industry we aspire to, then those of us at the top have a responsibility – and an opportunity – to support entrepreneurs with new thinking, fresh voices and diverse points of view.
This has been a journey for M12, and one that’s deeply personal for me. Today is just one of many steps we’ll take to ensure that VC dollars reach the ideas and founders with incredible investment potential that too often get left behind.
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