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Female Founded Series A Rounds in NYC Double in 1H2015

Earlier this year, F Cubed published an analysis of female-led companies in NY and SF who successfully raised Series A financing in 2013 and 2014. Looking at this analysis, it was clear that female founders who have historically experienced difficulty getting a seat at the VC table – let alone a term sheet – are receiving funding at increasing rates. In 2014, 13% of all A rounds in NYC had female founder/CEOs, and the number of NYC-based companies with female CEO’s that raised Series A financing grew 1100% from 2013 to 2014. We track this data at F Cubed as its continued positive momentum is proof not only of the vigor and profitability of female leadership but also of our very existence.

Below is a similar analysis updated through June 30, 2015 to assess if these numbers are continuing to trend upwards midway through the year. The results are promising.

As per our earlier report, our definition of a Series A is a financing round led by an institutional investor with between $2.5 million and $15.0 million in funding. Note that the data below contains information on Series A financings recorded publicly. If we are missing anything, please let us know. Our main sources are Mattermark and Crunchbase.

To start, we did an overall review of A rounds globally, nationally and regionally.

A rounds in 1H 2015 (January 1 – June 30):

Globally: 642
United States: 335
Bay Area: 99
NYC: 53
Boston: 23
Los Angeles: 20
Austin: 18
Chicago: 11
Seattle: 10
Washington D.C.: 9

 

fcubed_infographics_2015-3

A Rounds in 1H 2014:

Globally: 292
United States: 220
Bay Area: 83
NYC: 33
Boston: 17
Los Angeles: 11
Austin: 2
Chicago: 5
Seattle: 4
Washington, D.C.: 7

fcubed_infographics_2015-4

In the first half of 2015, NYC saw 53 companies raise A rounds compared to a total of 33 in the first half of 2014. Out of these 53 A rounds, 8 companies or 15% of all A rounds in the region, had female founder/CEOs. Compare this to the first half of 2014, when only 3 companies with a female founder/CEO raised an A round, representing 167% growth year-over-year.

fcubed_infographics_2015-5

Meanwhile, the Bay Area saw 100 companies raise A rounds during the same period, compared to 83 A rounds in the first half of 2014. Out of these 100 companies, 8 or 8% of all A rounds had female founder/CEO. 2014 was much stronger during the same period with 13 companies with female founder/CEOs raising an A round.

fcubed_infographics_2015-2

The data reflects two clear trends: (i) NYC’s growth in institutionally-led A rounds is growing at a much faster pace than SF’s, and (ii) the number of A rounds led by female founder/CEOs in NYC not only doubled in one year, but also is significantly healthier than in the Bay Area. The city is continuing to serve as a magnet for women building exciting businesses. Compare this to 2013 with a grand total of one A round led by a female founder/CEO in NYC. Our view is that these numbers will continue to increase as the talent pool of women who have worked at companies like Gilt, Amazon and Rent the Runway as well as in industries like media, retail and more will venture out on their own.

fcubed_infographics_2015-1

Digging deeper into this year’s eight A rounds in NYC, the largest A with a female founder/CEO was The Muse, which launched in 2011 and raised $10 million, led by Aspect Ventures, Great Oaks, QED and DBL The next largest was Campus Job, founded in September 2014, which raised $7.8 million led by General Catalyst with participation from BoxGroup, Lerer Hippeau, Index Ventures, Slow Ventures, SV Angel and Female Founders Fund. In terms of sectors, four of these companies focus on verticalized search: PowerToFly, Campus Job, Culinary Agents, The Muse. There is one company representing each of the following: marketplaces (PolicyGenius), software (Gracious Eloise), advertising (Snaps) and wearables (Ring.ly). Out of the 8 Series A rounds in NY in 1H 2015 led by female founder CEOs, F Cubed seeded invested in 3, or 38%.

On average, these companies spent 434 days in the seed stage. Culinary Agents, an F Cubed portfolio company, was the quickest to make the jump from seed to A at 102 days. Two of these CEOs have a technical/engineering background (Christina Mercando at Ringly and Milena Berry at PowerToFly) and the remaining have fine arts, design or journalism backgrounds or have worked in consulting or at large internet companies..

fcubed_infographics_2015-6

Venture fund involvement in these companies was led by both East and West coast -based venture funds such as General Catalyst, Lerer Hippeau, First Round and Andreessen Horowitz. However, the largest A round (The Muse) was led by a VC fund founded by two women – Aspect Ventures (Theresia Ranzetta and Jennifer Fonstad).

Not captured in the data, but certainly worth noting, is that this year began with LearnVest – the personal finance company founded by CEO Alexa von Tobel – being acquired by NorthWestern Mutual for $250 million. Prior to its acquisition, LearnVest raised $70M in venture capital from funds including Accel and American Express Ventures. This was one of the largest venture-backed exits thus far in 2015 in NYC, and a testament to the power of female leadership. Shortly thereafter, in March 2015, SF’s Nextdoor raised financing at a $1.0B+ valuation, making it one of few unicorns with a female on the founding team. These successes, combined with the data below, give credence to our belief that the pattern is indeed changing for females seeking VC funding.

Looking at this data, we see a trend that reflects positive signs for female founders, specifically in New York. Other reports such as First Round Capital’s Ten Year Review also provide strong evidence that points to the increased likelihood of success a female founder adds to a start-up team. We look forward to seeing what the rest of 2015 holds for these entrepreneurs.

*Note there was 1 large Series A round at a Los Angeles-based company with a female CEO in the first half of 2015: Reformation led by The Stripes Group and 14W.