Boulder Among Top Cities Nationwide For Female-Founded Startups

BOULDER, CO -- In 2017, just 16 percent of the money invested in U.S. technology startups went to companies founded by women. A study released this week by the Center for American Entrepreneurship, however, found that Boulder, along with other cities like Ann Arbor, Michigan and Memphis, Tennessee, is one of the best places in the country to be a female founder.

Between 2005 and 2017, 19 percent of Boulder startups that secured a first round of venture capital were founded by women. That's larger than the national average, but perhaps more importantly it is also part of a trend: For the 2016–2017 cohort of financed startups, 41 percent of Boulder's startups had at least one female founder, compared to just 21 percent nationwide.

“Women are [still] severely underrepresented in venture-backed companies, when compared with a whole host of other benchmarks,” the report’s author, Ian Hathaway, told VentureBeat this week. “But things are improving rapidly, and steadily.” Hathaway also mentioned that the potential reasons for the geographic trend are varied, including the number of female investors in the region and whether that city supports sectors that are generally more female-friendly like consumer products, health care, or software.

The study also found that most female-founded startups that were able to raise a second or third round of capital within three and five years, respectively, and that eventually went public, did so at about the same rates as startups without a female founder. The study did not, however, compare the size of the rounds raised by startups with and without a female founder.

The study also noted that after the first round of investment, female-founded startups were equally as likely to secure second and third rounds of funding or go public within eight years. Several previous studies have indicated that venture capitalists are more likely to support startups with similar background and characteristics.

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