Five fundraising recommendations from women investors

“Some women founders don’t seem to understand how the game is played.”

Several women investors commented that some women founders don’t appear to know the terms commonly used in the VC industry, the way the investment landscape operates, or which type of investment to seek. “The VC landscape is opaque, intimidating and jargon-heavy," one interviewee explained. Men founders – by contrast – tend to be more aware of how the whole ecosystem works and what options are available. It may sound obvious but it’s vital that women founders educate themselves on VC before starting to approach investment funds.

Even at the earliest stages of founding a company, 76% of female founders expressed a lack of awareness of what fundamentally constitutes a VC-backable business¹³.

According to our interviewees, women founders who’ve learned to speak the same language as investors have a better chance of attracting funding. The same is true when it comes to understanding the financial workings of the sector. There are plenty of educational resources available to everyone online, and all women founders – particularly first-time fundraisers – should use these to educate themselves.  

“If I ask a woman founder what the pre-money valuation is and she doesn’t know, I think: ‘You may have got this meeting, but you’re not getting another’.” 

“Investing is a personal business – so at some point, intuition, past experience and personality all come into the decision-making process.”   

Once a woman founder has educated herself on the investment ecosystem, she should then research the best funds to approach. Alongside each fund’s size, industry focus, and the types and stages of the businesses in its portfolio, investors said the most important factors to consider include whether it has already invested in female-founded businesses, how much, and how often.

For founders, what matters is finding a VC that truly ‘gets them’ - shared alignment of vision and purpose is by far the most cited response (36%).   

After meeting potential investors, a woman founder might find herself in the positive situation of being able to choose from several term sheets. If this happens, she should use her intuition and select an investor she resonates with personally. The professional relationship could last 10 to 15 years, with monthly, weekly and sometimes even daily interactions, so personal chemistry is key. Some investors highlighted the two-way “founder-investor fit” – centred on compatibility and shared goals – as key to the financial success of any deal.

“The entrepreneurial journey can be lonely. It’s important to have emotional support as well as being able to get practical advice from others who are in a similar position and understand what you’re going through.”

Like the women founders in our previous study, women investors were unanimous in stressing the importance of networking. They recommended that founders start building relationships around 6 to 12 months before they need funding, developing useful contacts for the long term. However, they cautioned against networking for its own sake, and stressed the need to network in a targeted, strategic and selective way – “the quality of connections is more important than quantity” – and actively stay in touch with new contacts. One investor said she likes founders to follow up with a purpose and keep her informed of progress and milestones passed since their last discussion.  

“You have to build your confidence in networking with the low hanging fruit – then you can go for the big fish.”  

One personal issue that can clearly arise for women founders – generally some years after their first fundraising – is progressing to motherhood and perhaps other caregiving responsibilities. These commitments can limit the time available for networking, reinforcing the need to network selectively and prioritise running and growing the business. Asked about women-only networks, some investors felt these offer a safe space to connect on common experiences, while others stressed that gender diversity is important in a woman founder’s network. An interviewee advised women founders to “spend less time questioning yourself, and more time connecting with people you can learn from”.  

Figures from the European Institute for Gender Equality show that in Europe, women are twice as likely to spend at least five hours on childcare per day than men¹⁴.

"It may feel personal but it’s just the way an investor gets comfortable that you are in it for the long haul.”

A consistent theme across our interviews was that women founders must ensure they’re fully prepared in all dimensions before speaking to investors. This means not only knowing their company’s financials inside out, but also being ready for the psychological and emotional strains of the interaction; possibly including facing personal questions that men wouldn't be asked. These might range from queries about plans for parenthood to queries with a more subtle undertone of bias, such as questioning a woman founder’s commitment or resilience. 

Interestingly, women investors were divided on whether it’s appropriate to ask about women founders’ personal lives. Some felt investors should accept that everyone has personal commitments, while others saw these as valid areas to probe. Either way, the consensus was that women founders should be well-prepared for personal questions, while also being ready to substantiate their financial numbers with credible, data-driven answers. As several interviewees pointed out, investors are looking to allocate capital to the founder who exhibits – and inspires – the greatest confidence. 

“Nobody wants to invest in a person who isn’t sure of what they’re doing. Investors want to see someone who is convinced of their idea.”  

More generally, women founders should be ready to encounter unconscious bias. Our interviewees noted that some male investors tend to ask “prevention” questions related to risks to women founders, but “promotion” questions about growth opportunities to male founders. One investor’s advice here was to “answer prevention questions with promotion answers.” While our interviewees agreed it can be frustrating when a woman feels the impact of gendered questions in the room, they recommended shifting the conversation quickly back to tangible metrics, with calm, considered and stoic answers being the most effective response. 

A survey of 189 companies revealed that 67% of questions posed to male entrepreneurs were promotion questions, while 66% of questions put to women founders were prevention questions¹⁵.

“Women tend to state the actual and the factual – and do very little vanity-led metrics and upselling around their story.”   

Several interviewees noted that women founders often ask for less funding than men, present more conservative growth projections, and undersell their business plans. They added that women entrepreneurs also talk more than men about their historical achievements rather than their company’s future potential, while male founders usually present ambitious “hockey stick” growth projections.   

According to HSBC, investors may misinterpret women entrepreneurs’ realistic goals and conservative growth strategies as signalling a lack of conviction. Women investors agreed – highlighting that men founders usually paint a picture of their future vision, while women founders focus more on where they are today. Raising money means presenting credible, well-substantiated facts, while also selling an ambitious vision of what’s possible. We heard that many women founders are struggling to strike this balance. 

“Put your optimistic case forward, not your base case – because everyone else is.”¹⁶

As well as pushing their vision harder, women founders should also think bigger – offering a clear plan to use investors’ capital to scale up their business. VCs are looking for businesses that will eventually become unicorns: they know the risks and do their own due diligence to calculate what’s feasible. Our interviewees said women founders shouldn’t be constrained by their own concerns that they won’t generate the financial returns that investors want.