Search for...

The Numbers Don’t Lie: Gender Diverse European VCs Achieve Superior Returns

The European Women in VC team
Image credit: The European Women in VC team

Only have 1 minute? Read our 3 takeaways:

    European Women in VC publishes their third study on how gender diversity in venture capital affects the performance of VC firms in Europe. 

•    The report finds evidence of a gender-performance correlation, including that European VC firms with more women in senior management roles show improved financial performance.

•    The results are even more important considering that, similar to last year, the amount of assets managed by female General Partners (GPs) makes up only 9% of total assets, while male GPs manage 91%.


The latest report from European Women in VC emphasizes the importance of empowering female managers and supporting them in improving fundraising efforts in the European venture capital industry. Titled “Achieving Superior Returns with Gender Diversity in European Venture Capital Firms,” the report will be available for download on the European Women in VC website starting September 13th. 

“This report serves as a crucial stepping stone toward a more inclusive and prosperous future for the European venture capital industry. While progress is being made, we must collectively acknowledge that change takes time. The correlation between gender diversity and superior performance is a powerful motivator for the industry to adapt to the evolving landscape. Nevertheless in order to draw a full picture of the impact of diversity on performance European funds must report their returns, we need openness and data in order to constantly search for arguments and ways, for all of us, to benefit from diversity,” says Kinga Stanislawska, Founder of European Women in VC.

Due limited availability of fund performance indicators, the financial analysis in the report is based on a smaller sample size, covering 100 venture capital firms.

Gender-performance correlation

The study reveals that European venture capital (VC) funds with a greater number of women in top leadership roles saw improved financial performance. Specifically, funds managed by mixed-gender teams reported a higher annual internal rate of return (IRR), with teams predominantly composed of women outperforming all-male teams by a notable 9.3 percentage points.

Read more:  The Estonian Guide to Breeding Unicorns

Additionally, for every 10% increase in female representation on senior management teams, there was a corresponding 1.3 percentage point boost in the fund’s IRR. The research also indicated that funds with more women in senior positions experienced less fluctuation in their portfolio returns, indicating lower risk.

Highlighting this correlation between gender diversity and fund performance serves as a catalyst for change in the VC industry. It emphasizes that diversity isn’t just a box to tick, but a strategic necessity for achieving stronger, more stable returns.

How VCs tackle the issue of diversity

Despite evidence that funds with more female managers yield higher returns, gender disparity remains a significant issue in European venture capital firms. The European VC’s comprehensive study involving 558 VC firms and 104 survey respondents found that, as of 2023, only 16% of general partners (GPs) are women, a modest increase from 15% in the previous year. This imbalance poses challenges for female fund managers trying to secure capital in a sector largely driven by personal relationships.

In terms of investment power, or Assets Under Management (AUM), female GPs control just 9% of the total AUM, compared to 91% for their male counterparts. This unequal distribution affects the ability of women to reinvest in the sector, a common practice in venture capital. Female investors are also two to three times more likely to back female-led startups, amplifying the impact of this imbalance.

However, there’s a glimmer of hope: the growth of the VC market in Europe is creating opportunities for more diverse teams. Survey data shows that 47% of European VC firms expect an increase in female GPs within their ranks over the next five years. Yet, only half of the surveyed firms have concrete strategies for improving gender diversity, and these plans often fall short in areas like career development for women and effective internal measurement of diversity and inclusion efforts.

Read more:  Tatyana Ivanova's Path to the Stars. The 19-year-old with a Dream of Becoming Bulgaria's First Female Astronaut.

Thank you for reading The Recursive!

Over 1 million people from all over the world have learned about the tech ecosystem in Central and Eastern Europe thanks to The Recursive. In order to keep our content free for everyone, we need your help. If you believe what we do is important and have the means to do so, support us in giving a voice to Central and Eastern Europe with as little as €7. Thank you!

DONATE Keep reading this article

Help us grow the emerging innovation hubs in Central and Eastern Europe

Every single contribution of yours helps us guarantee our independence and sustainable future. With your financial support, we can keep on providing constructive reporting on the developments in the region, give even more global visibility to our ecosystem, and educate the next generation of innovation journalists and content creators.

Find out more about how your donation could help us shape the story of the CEE entrepreneurial ecosystem!

One-time donation

You can also support The Recursive’s mission with a pick-any-amount, one-time donation. 👍

Antoanela is a Sustainability Communications Specialist and Deputy Editor at The Recursive media. From these roles, she is helping organizations communicate their latest sustainability goals, strategies, and technologies. She writes about climate tech, ESG, impact investment, sustainability regulation, and related topics.