September 19, 2019

London’s VCs are rubbish at diversity

London VC firms remain woefully behind on diversity and inclusion, according to Diversity VC's latest report. That's not good enough.

Amy Lewin

2 min read

Founders and managers are told to lead by example.

Perhaps investors should start doing the same.

The latest report published by non-profit Diversity VC reveals that the majority of London’s VC firms are falling down when it comes to diversity and inclusion.

Top line statistic: 60% of the funds surveyed did not have anyone responsible for diversity and inclusion. This doesn’t mean someone employed solely to take the lead on it (VC firms have, on average, nine employees): it means somebody who, as part of their role, is responsible for thinking about diversity and, ideally, also putting in place initiatives with budget behind them.

That's not all that big an ask.

Perhaps more worryingly, 47% of the investors contacted thought their firms had no recruiting policies in place to promote diversity. That’s tech hiring 101.

Graphic: 60% of London VC funds do not have a D&I champion

When it comes to practicalities too, London’s VC firms have a way to go. Being inclusive is about making everyone feel like the workplace is somewhere they belong; yet, for example, none of the funds surveyed had prayer room facilities. This is no small oversight: 12% of London’s population identify as Muslim.

Graphic: 0% of London VC funds have prayer room facilities

Just over half of the funds spoken to have flexible working policies in place, which are known to support working parents and carers.

On top of this, female representation at senior levels of London’s VCs firms is also very low: only 9% of investment committee members are women.

Graphic: 43% of London VC funds don't have flexible working policies

An embarrassing 39% of London’s VCs don’t have any women on their investment team — which is worse than the UK as a whole.

Graphic: 39% of London VCs don't have any women on their investment team

The VC workforce is a little more diverse than the UK workforce as a whole in terms of ethnicity. But still, given that the majority of UK VC firms are based in the capital, not as diverse as the London workforce.

Graphic: UK VCs are more ethnically diverse than the UK workforce as a whole
Graphic: London VCs are less diverse than the London workforce as a whole

Finally, when it comes to the most impactful measure of them all, London’s investors are overwhelmingly backing male founders. And, despite the increased focus on diversity over recent years, the numbers aren’t changing: over 90% of funding still goes to all-male founding teams.

Graph: Money raised by UK startups going to all-male founding teams

Lead by example investors. Start paying attention to diversity internally — and a more diverse range of founders might start paying attention to you.

Amy Lewin

Amy Lewin is Sifted’s editor and cohost of Startup Europe — The Sifted Podcast , and writes Up Round, a weekly newsletter on VC. Follow her on Twitter and LinkedIn