Female-led teams in the Dutch startup ecosystem: A 2020 analysis

Anna Dyachenko
Mar 1 · 7 min read

Hi there, we’re Golden Egg Check and we are startup analysts. We help startups to become investor-ready and we help investors and corporates to get in touch with relevant scale-ups.

Innovation has always been at the heart of economic growth. It can transform productivity and address long-standing and pressing issues. A critical question in today’s world is how to stimulate it?

A lot of innovation in society comes from fast-growing startups and scale-ups. They are able to grow fast with venture capital funding, and because they grow fast they can attract more venture capital. It’s a self-reinforcing effect.

But it’s also the other way around; a lack of venture capital limits growth and lower growth figures make it harder to raise funding.

We all know that startup fundraising is no walk in the park. It is a challenge faced by all entrepreneurs looking to grow. But then why are women statistically the ones who are raising venture capital less often and if they do, why in smaller amounts? Females have been experiencing challenges not only in raising capital but just in starting companies, being underrepresented in leadership roles. Especially in startups and tech companies.

There might be plenty of potential reasons for this. One of them is that there are simply fewer role models, female angel investors, and mentors for these women. Or maybe it all comes from our childhood, where boys and girls could be unconsciously treated differently causing stereotypes when it comes to what they think they can achieve. We don’t know that, but the thing that we do know is — women’s lower presence in startups disadvantages not only women themselves, but also society at large, by “wasting” a significant potential.

Back in 2019, an important initiative began in the Netherlands, called #FundRight. They are aiming to ensure a more diverse tech ecosystem, at both VC level and portfolio company level. Committed investors pledge to have “a significant percentage of the companies in which they (co)invest, must be (co)founded by a woman” and that 35% of the management teams of their portfolio companies are female.

To achieve this by 2023 they tend to change human behaviour towards the way investors source their deals, companies hire people and discuss gender diversity issues.

So how’s it going with that ambition? To track the progress in achieving the goal of gender diversity, we at Golden Egg Check did a little research on female presence in the top management of companies that were venture capital-funded in 2020.

The vast majority of Dutch deals in 2020 go to business with no women on the founding team

Last year almost 1.7 billion euros were invested in (at least) 268 different Dutch startups. In a previous post, we have published the full list of companies that raised VC funding in 2020. If you are curious — check our blog for more insights.

Only 11% of these startups had at least one female (co-)founder. That’s 2% less than the year before. In 2020 those female-founded teams were able to raise €92 million, which equals 6% of total funding. Interestingly, this is twice the percentage of 2019.

Companies founded solely by women received 4% of all Dutch deals in 2020, less than 1% by value. Mixed-gender teams received 7% of deals, 5% by value. Taken together, this means 11% of all Dutch deals in 2020 (6% by value) went to businesses with at least one female founder.

On the bright side, the total round size of female-led and mixed teams went up from €46 million in 2019 to €92 million.

Female teams are not represented in the Fintech and Cleantech industries

These 268 companies can be divided into the eight industries in which they operate. Most companies are active in Software (40%) and Medtech (16%).

The group “Other” includes companies that act in fashion, mobility and wellbeing.

Below you can see the infographics that represent the distribution of female (co-) founded companies by industry.

There were no Fintech or Cleantech female-led startups that got an investment in 2020. On the other hand, female-founded teams are overrepresented in Impact, Medtech and ‘other’. Yet, they still are a minority.

Diverse teams are more than teams with female (co-)founders

So far we have been mainly focused on companies that have female founders or co-founders. But what about women that occupy top management positions? Did not they contribute enough to the successfully raised funding? There are a bunch of companies where women act as a CxO (CEO, CFO, CTO etc) for years and take just as much responsibility for their decisions as founders. We believe that they sufficiently contributed to the added success of their companies and must be mentioned. If we discuss ‘diverse teams’ we feel CxO should be included in this overview.

All together, companies with a female in the top management compose almost a quarter, 23%, of all startups. Those teams were able to raise €290 million, which equals 17% of total funding.

23%, that doesn’t seem too bad, does it? It’s at least a lot closer to the 35% ambition of #FundRight.

Chief operating officer (COO) is the most common female role

Female CxO’s “traditionally” perform different managerial functions. Women predominate in the field of (internal) operational management as Chief Operating Officer — 35% of the female leaders are COO.

Men are typically more involved in roles that require strategic management, making decisions on innovation, research, financial stability, etc. They often have more visible, external roles such as CEO. And the CEO is usually on stage to deliver a pitch, is interviewed by a newspaper, blog or podcast, or is asked to share lessons learned for aspiring entrepreneurs. Male role models are great, but more female role models would be even greater.

I will not argue about the importance of these roles, since they are all crucial from the point of view of the company’s development.

However, this division of managerial functions may indicate the potential presence of gender stereotypes in job selection and career advancement. In my opinion, the difference can be rooted in the stage of education; women and men get an education in different fields. Therefore we can’t deny the importance of #FundRight initiative. Their effort at changing human behaviour towards dropping gender stereotypes to shift the mindset and break free of homogeneous funding.

The initiative began almost 2 years ago and we already can see the changes. Out of all female (co-)founded startups, 23% of them participated in this initiative, and they raised half of all “female” capital.

There is still definitely a big room for improvement. Though the main challenge is not in the number of deals or investment amounts that women-led startups managed to get but in our way of thinking. While we face gender stereotypes, the problems of women’s low presence in entrepreneurial life exist.

To address the problem of homogeneous funding in the Netherlands we need an integrated approach (see some practical solutions to fix the gender investment gap here). As individual efforts alone will not achieve the transformative and industry-wide change needed. At GEC we don’t want to be left out and therefore we’re hosting a new FEMALE edition of StartupRoulette in May to facilitate the closing rounds for female startups. Soon we will tell you more about it!

Thank you! ❤

The analysis is based on facts and figures that were generated from Golden Egg Check report “Startup Funding 2020”. In the report, we focused on startups and the scale that raised funding by VC in 2020. This led to a comprehensive database of 272 deals across our understanding and definition of what we consider startup and scale funding.

Consider following this Medium blog, or Golden Egg Check on LinkedIn to get heads up when we publish our new blogs about the (Dutch) startup and venture capital ecosystem. And, if you’re feeling really excited, you can get access to our comprehensive dataset and report via our webshop. With this dataset, you can see for yourself the startups with female leadership that raised funding (and you support our efforts).

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💵 If you’re a startup looking for investors, join StartupRoulette, our online curated speeddate event.

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