Fuel Ventures, an upstart London-based venture capital fund, has launched a new scheme in a bid to tackle unconscious bias against female founders.
The venture capital industry, as well as the technology businesses it tends to invest in, are both rife with gender and diversity inequality. Less than 10% of venture capital funding in the UK went to female-led companies in 2017, according to data from PitchBook, for example.
So, starting in December, Fuel Ventures founder Mark Pearson decided to do something about it, and started trialling anonymous pitch decks in a bid to avoid unconscious bias creeping into the firm's investment decisions.
“We’re doing a female founders push, which started in Q4 last year," Pearson told Techworld. "We want more female founders and tech startup companies to pitch to us, because we need to get our numbers up.
“Our actual agenda is that we want to invest in the best founders with the best businesses, other funds do this and that’s also a fascinating methodology, but we will be pushing to really do what we can to up the opportunity for females and diverse founders," he said.
The startup fund, which launched in 2015, noticed that only 4% of pitch decks it received came from female founders, with 13% including a female member as part of the founding team.
In practice this means an independent offshore team is now responsible for channeling all website submissions to the Fuel Ventures team. Before any of these decks reach the UK office all images of founding teams are blurred out and names are redacted. That company signed anonymous information contracts so the data is kept with Fuel, and is paid on a monthly, freelance basis.
“So we’re still seeing company names and logos, but we’re taking out any personal details around the founder or teams,” Pearson added.
The identity of startup founding teams remains anonymous until the interview stage and meeting requests are made.
“People can impress you in different ways, and I don’t want that to be a flaw in our process," he said, "but imagine if we’re dismissing companies because of this, unconsciously. So that was really my objective: How do we get more through and give them a chance to really impress us?"
Fuel Ventures will trial the initiative over the next three months. “I think we’ll probably continue to think of innovative ways to improve processes, because I’m a genuine believer in diversity and everyone deserves the opportunity, but it’s tough because we don’t know what our minds are doing, we don’t know our core decision making processes,” Pearson said.
Fuel Ventures currently invests up to £2 million in one company a month, totalling around 10 deals a year.