Lucas College & Graduate School of Business, San Jose State U., United States
In 2022, female led ventures received only 1.9% of venture capital funding; a concerning trend that has been steady for years. Furthermore, only 15% of all technology based ventures have female founders. These disquieting trends leads us to question if female-led impact ventures are likely to receive lesser amounts of equity funding than male-led impact ventures? Is this relationship likely to change if the ventures in question are invention-based, where invention-based ventures have historically and stereotypically been male-dominated? Furthermore, what role does a country’s cultural masculinity play in this relationship? This study draws upon Gender Role Congruity Theory to examine whether, how, and why women-led impact ventures experience disparity from their male counterparts in the ability to obtain early-stage equity investment. Analysis of survey data collected from 4,206 for-profit impact ventures from 205 impact-oriented accelerator programs across 121 countries was used to explore these phenomena. Results indicate that female-led impact ventures are disadvantaged compared to male-led impact ventures in obtaining equity investment. Furthermore, female-led impact ventures are less likely to be invention-based than male-led impact ventures. Finally, the ingrained culture of masculinity, as measured at the country-level, exacerbates the disadvantages experienced by female founders in obtaining equity funding. Overall, this study contributes to the literature on global entrepreneurial finance from a gender role perspective and is crucial to understanding the challenges female entrepreneurs encounter in obtaining early-stage equity investment.