, affecting companies closer to an IPO that had pulled in supersized checks at inflated valuations in 2021 and 2022. Now, the venture downturn has hit the seed stage. After a significant tightening in the startup fundraising scene in 2022, obtaining early-stage capital became even more challenging in 2023. Investors hesitated to participate due to concerns about sustained high interest rates, causing VC funding to its slowest pace since 2018.
All-female teams with minority members saw their average fundraising times rise the most while they continued to raise the least among all demographics.Diverse teams raised 26% less on average than all-white teamsAll-female teams faced the most challenges in 2023. All-white female teams took 67% longer to raise their round and diver female teams took 75% longer. These increases are over 50% longer than those experienced by other demographics.
Diverse all-male teams were the only demographic whose average investor meetings increased from 2022 to 2023.Comparing pitch decks by gender reveals trends and bias as well with certain slides matter more by gender or race. With regard to gender, “VCs spent 66% more time on all-female team sections compared to all-male team slides . Similarly, all-female business model sections received 41% more investor attention than all-male sections.
Laura Rippy, an investor at Alumni Ventures, said, “The deck attention figures are arresting, especially in the context of female teams raising less on average. It’s hard not to conclude that biases are entering the fundraising process during these pitch deck reviews.”When pitch deck scrutiny was analyzed by racial demographics, three sections stood out: team, product, and business models. First, investors spent 20% more time on diverse teams’ team sections than on all-white teams.