Want Investors? Be an Attractive Man!

Fiona Murray - Study authorResearchers at MIT and Harvard noticed that less than 10% of venture capital money in Silicon Valley went to companies by women. So they decided to look at see if there was some real reason for this like woman not having as many startups or if it was just sexism. Can you guess what they found? They took actual startups and presented them to actual venture capitalists. But they randomized them so that sometimes a woman was presenting and sometimes a man was presenting. They also broke the sexes down into attractive and ugly.

The result? The venture capitalists said that they would invest 68% of the time when it was a male presenting. When it was a female, only 32% were interested in investing. So a startup was twice as likely to get funding if it was headed by a man. I’m a cynical guy and even I was shocked by that. But it gets worse. Attractive men were even more likely to get funding. Attractive and ugly women did not have a statistically significant difference, probably because to the venture capitalists, all women are unappealing.

I got this information from a Forbes article, New Research: VC Preference For Men Persists (And Attractive Males Fare Best). It is telling. After going through the research, the author seems to have forgotten what the study showed and tried to minimize its importance:

Another theory holds that male- and female-led ventures tend to focus on different kinds of market opportunities that map to different levels of growth—that male entrepreneurs tend to pursue ventures across a spectrum of industries, while women-led ventures pursue female interests such as fashion, cosmetics, and cooking.

That’s not what the research was about. And regardless, the research indicates that if an attractive man starts a new fashion company, investors are far more likely to give him money than if a woman had started it. There are lots of other reasons why women don’t get as much investment money as men. I’m sure that men being more aggressive helps them. But this study strips away all of that.

The last third of the article is an inspiring story of a female entrepreneur who beat the odds even after the “funding community rebuffed her.” These are a mainstay of conservative apologetics for inequality. If one woman can make it despite the sexist racist ageist system, then anyone can! Of course, that doesn’t follow. And regardless, all that means is that an exceptional woman can do as well as a mediocre man. That isn’t any reasonable person’s idea of “equality of opportunity.”

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