The future for women investors is in danger

"When I started Female Founders Fund in 2014, I believed that solid returns and conviction would speak for themselves. Strong performance would unlock capital and the industry would reward the achievement, especially from those breaking new ground-or so I thought. What I've come to learn is that venture capital isn't a pure meritocracy. It's a network-driven ecosystem where who you know often matters just as much as what you build."

"Cultural and political changes, and a tight market environment, are making it especially difficult for fund managers to maintain momentum. Now is the time for the industry to reflect on how to ensure that these funds, especially those led by diverse managers, can weather these forces and continue to support diverse founders with brilliant ideas. Investing in women isn't charity. By yielding powerful, durable returns, it has proven to be smart business."

"Over the years, a few lessons have become clear. They aren't the ones you find in your LPA, but they're the realities that quietly shape who gets funded, who gets backed again, and who quietly fades away. Returns are just one part of the picture. While performance is important, other forces-institutional change, personal networks, and internal politics-often drive how capital gets distributed. Once an institution commits to a fund, that relationship can extend across multiple vintages. The incentive to change managers is low."

Only about 10 percent of venture funds reach a fourth vintage, and only 5 to 10 percent of those funds are led by women. Strong returns alone do not guarantee access to follow-on capital because venture capital operates as a network-driven ecosystem where relationships and proximity to top-tier talent matter as much as performance. Cultural and political shifts and a tight market create headwinds that shorten the runway for diverse managers. Institutional inertia, limited check writers' incentives to change managers, and preference for spinouts from elite firms compound the challenge. Investing in women has produced durable, powerful returns, so institutions should heed the data.

Read at Fast Company