University Research Finds Gender Bias in Venture Capital Funding Decisions

Research co-authored by scholars at the Massachusetts Institute of Technology, Harvard University, and the University of Pennsylvania, finds that good-looking men are more likely to receive venture capital funding from investors than women and less attractive men. The results showed that the short pitches entrepreneurs make to venture capitalists are influenced by the gender and appearance of the presenters.

The results showed that men are 60 percent more likely to be funded than women. Men considered to be attractive were 36 percent more likely to receive financial backing than other men. In another controlled experiment where identical business plan videos were presented to venture capitalists, those plans with a male narrator were 68 percent more likely to be funded than plans where the video had a woman as the narrator.

Fiona E. Murray, the Alvin J. Siteman Professor of Entrepreneurship at MIT and co-author of the paper, stated, “We don’t always like the results we find, but this sort of systematic evidence helps us to start a conversation and discuss ways to change biases and ensure that women can engage as effectively in innovation-driven entrepreneurship as their male counterparts. The more women we encourage to participate in innovation-driven entrepreneurship, to pitch and go out seeking capital, the more usual it becomes. Over time this should reduce the bias in the system. At the same time, armed with an awareness of bias, women entrepreneurs can be more prepared and focused on their funding goals.”

Professor Murray has been on the faculty of the Sloan School of Management at MIT since 1999. She earned bachelor’s and master’s degrees in chemistry from the University of Oxford in England. She holds a second master’s degree and a Ph.D. in applied sciences from Harvard University.

The article, “Investors Prefer Entrepreneurial Ventures Pitched by Attractive Men,” was published on the website of the Proceedings of the National Academy of Sciences. It can be downloaded by clicking here.