Funding Focus is a first-time fund dedicated to investing in female and ethnic minority founders. It is on a mission to secure attractive valuation in female- and ethnic minority-led companies that have the ability to outperform peers.
David Horne
Founder
Funding Focus
2019
Founded
B Corp Certification
Pending
IPO planned
2023
Challenge: Lack of funds flowing to female entrepreneurs
In 2019, Funding Focus founder, and award-winning author, David Horne was speaking at an investing conference in Reading, England when an audience member asked for his thoughts on why female founders were attracting such a tiny fraction of venture capital relative to their male peers. He didn’t have the answer, but his curiosity was sparked. That spark became the flame that ignited Funding Focus.
David turned to PitchBook to do his due diligence and inform what would become Funding Focus’s investment thesis. PitchBook’s Venture Monitor report, a quarterly examination of trends across the global venture capital landscape, revealed that VC investments were up by 91% in 2021, for a total of $330 billion in the US, while across the pond, VC investments in Europe topped €100 billion, representing 115% growth over 2020. However, only a miniscule share of that funding was being channeled to female founders.
- Companies founded solely by women garnered 2.4% of the total capital invested in venture-backed startups in the US.
- Companies founded solely by women garnered just 1.1% of the total capital invested in venture-backed startups in Europe.[1]
While female founding teams submitted 5% of the pitch decks in Europe, they got 1% of the money, indicative of low valuations. Yet, studies show female founders outperform males in terms of revenue generated per dollar invested.[2] This became the basis of Funding Focus’s go-forward strategy.
Solution: Investing strategically in female- and minority-led startups
With research in hand, Funding Focus set out to fight for fairness in funding by creating a public fund with B Corp certification, confirming its tremendous potential to have a positive social impact.
Using PitchBook, David and team studied the competition to create the Funding Focus pitch deck. They also identified several institutional investors with a track record of cause investing, as well as family offices and other entities whose corporate social responsibility programs would benefit from investing in female founders.
| “ | PitchBook saves us a lot of time. The advanced search feature helps us zero in on the most ideal investment targets and investors, complete with contact details.”—David Horne, Founder |
Results: Rich connections and conversations enabled by PitchBook
As Funding Focus awaits its B Corp certification and approval of a prospectus from the FCA, it is proceeding with pitch meetings. The team has made connections with over a thousand entrepreneurs, investors and others interested in its mission thanks to the insights and contact details available on PitchBook.
With their Early Notification of Listing filed with the London Stock Exchange, Funding Focus anticipates listing in 2023, growing the fund and investing in underrepresented founders with high-growth business opportunities in the UK and Europe.
In the meantime, the Funding Focus team continues to work to raise awareness of the imbalance of funding for female-led startups. Much of that advocacy centers on findings captured in David’s new book called Funded Female Founders which offers strategies for fundraising and tips for success from female founders who have overcome the gender bias. PitchBook will continue to closely follow the space on the US and European VC female founders dashboards.
| “ | Our customer success team has been incredibly helpful, helping us to elevate our research and identify winning strategies. I can’t wait to see what we accomplish using PitchBook once the fund is up and running.”—David Horne, Founder |
Related content:
US VC deal value for female founders is broken down by cities, sectors and exit activity.
Read our November 2022 report All In: Female Founders in the US VC Ecosystem
Starting a first-time fund can be an uphill battle. PitchBook offers tips for success
Read our blog post Top tips for first-time fund managers
Explore the historical performance of first-time and funds and emerging managers
Watch our webinar Private market fund performance: Spotlight on first-time and emerging managers
Learn how the first-time fund landscape has evolved since the Global Financial Crisis
Read our analyst note First-Time funds before the GFC
