Adding Claire Díaz-Ortiz to its partnership, Magma Partners launches initiative to invest in female founders in LatAm –
Summary
With the appointment, Diaz-Ortiz joins a small but growing list of women investing in startups across the Latin American region, which is subject to the same woeful gender disparities as the rest of the venture world. As Diaz-Ortiz has noted in TechCrunch, investing in female founders makes sense: Many studies have established that female-founded companies outperform their all-male counterparts. Boston Consulting Group reports that for every dollar a female founder or co-founder raises, she generates 2.5X more revenue than a male founder.1 First Round Capital’s research held that the female-founded companies it backed performed 63% better than all-male founding teams.2 The Ewing Marion Kauffman Foundation’s showed that return on investment from women-led teams is 35% higher than their all-male counterparts.3 AllRaise, a nonprofit promoting women in VC, found that “companies with women on their founding teams are likely to exit at least one year faster compared to the rest of the market, and the number of exits for companies with at least one female founder is growing at a faster rate year-over-year than exits for companies with only male founders.”4 Jen Neundorfer, founding partner at Jane VC, succinctly explains her fund’s thesis of investing in female founders as, “investing in an overlooked asset class that is overperforming.” After all, it’s a “trillion-dollar opportunity.”5 “We’re doing this because female founded startups have better returns and to highlight the disparity in VC funding to women entrepreneurs,” Diaz-Ortiz wrote in a statement. Magma has already made its first four investments into women-led or co-led startups: Jefa, a neobank focused on serving women in Central America; The Intern Group, which offers virtual internships for lifelong learning across careers; Prometeo, a startup developing open banking protocols for Latin American financial services; and Flickplay, a developer of augmented reality features for social networking. The first wave of firms was started by partners capable of raising funds from a male dominated pool of capital,” said Antonia Rojas of the new Brava Initiative from Magma, in a statement.