Investors want to know: where are the incredible, overlooked opportunities?
The answer came from an epiphany during my fundraising process.
Throughout fundraising, the most frequently asked question was: “how old are you?”
I’m 30.
I was asked my age, fairly consistently, by both female and male investors.
I’m proud of the breadth and depth of experiences I’ve had by my age, including successfully launching a fund with fantastic investors, across multiple closings.
It came as a surprise that the winning question was not my investment strategy, nor the rationale behind my thesis, nor the case studies to support my 30+ portfolio companies.
I’m inviting investors to an opportunity and this is what they want to know?
So naturally, I did my research.
I get that age is a proxy for experience.
As an emerging manager, was it about experience?
Was everyone being asked their age?
As I got curious, and interacted with dozens of managers, it was hard to ignore a pattern developing, specifically across gender lines.
Interviewing my male colleagues, across all ages, they rarely, if ever, were asked this question.
Alternatively, the age question, or age-related comments, were posed often to my female colleagues.
And then, female fund managers opened up further.
They shared stories of feeling discriminated against for being “too young” or “too old”.
The experiences with respect to diverse managers were even more disappointing.
I felt their frustration: there wasn’t an age or scenario where they could win.
And it broke my heart.
Are these the unique challenges that all female fund managers face?
Beyond anecdotes, broader studies indicate:
1) Ageism hits women harder and earlier than men (age 40 vs. 45).
2) Older women experience more employment rejections than older men.
3) ⅓ of managers would rather employ a man in his 20s or 30s over a woman of the same age for fear of maternity leave.
At this point, we’ve seen data to support that female investors outperform:
1) Goldman Sachs: “Since the market trough, 48% of female-managed funds have generated alpha, compared with only 37% of all-male funds.”
2) Fidelity: “Women earn higher returns than men when investing — to the tune of 40 basis points, or 0.4%.”
3) Warwick Business School: “Women outperformed the benchmark by 1.94 percent, beating men by 1.8 percentage points.”
You could argue selection bias with this data, aka only the top-performing women break through.
But still, only 5.6% of all US firms are women-led (1+ as partners), and we know, diverse teams drive returns.
With the double or triple bias of age, race, and gender… as an investor, this then begs the question:
Are we missing out on stellar, asymmetric opportunities – with respect to female fund managers – due to our own biases?
We all have blind spots as investors.
However, these blind spots impact performance.
What opportunities have you missed out on?
