Monday, March 19, 2012

Where are all the Female Angel Investors?

According to this article on peHub that was published this week, only about 5% of all the angel investors listed on AngelList are women. That’s pretty surprising considering about 9% of senior employees at VC firms are women, 7% of senior employees at PE firms are women, and about 20% of today's engineering degrees go to women. Based on other sources, females make up closer to 12% of all angel investors, which seems to be more in-line with what you would expect, but still much lower than is ideal for the investing community.

There was a good quote in the article by Sukhinder Singh Cassidy where she mentions, “Women underestimate themselves, while men overestimate themselves. You have to sort of lean into risk and have a higher confidence bias, rather than a confidence gap. And I don’t think that gene is bred into women.”

I do agree that this is one of the major problem that female investors have to face. The issues that female investors face have more to do with self-confidence in picking good investments and their risk tolerance. You’ll also find that this is probably why there are so few female traders on Wall Street.

In the November 2011 “Women in Alternative Investments” survey by Rothstein Kass and 85 Broads, one of the key findings was that the factors most critical to female investors’ success were strong professional networks, strong mentoring relationships, willingness to take risks, strategic career planning and strong support networks.  Clearly each of these factors can help address the confidence gap and risk-averseness that may hinder many female investors.

The author of the peHub article also went on to list seven female angel investors that are worth knowing. Check out the link here to see all the bios for each of these female investors: Esther Dyson, Cyan Banister, Andrea Zurek, Brit Morin, Ruchi Sanghvi, Joanne Wilson, and Julia Popowitz. Although I had only heard of two of these angel investors previously, I’ll be sure to keep a look out for some of their future investments.

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