Startups with women founders are on track to see record venture investment in 2019

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2019 is on track to be a banner year for female-led startups.

According to a survey conducted by Pitchbook and National Venture Capital Association, female founders are on track to rake in a record amount of venture funding through the end of the year. Through the first half of 2019, female-founded startups have raised $1.9 billion over 301 venture deals. In the entirety of 2018, female founders raked in $3.1 billion in 536 deals.

Women's clothing rental company Rent the Runway and skincare startup Glossier, both led by women, surpassed the $1 billion valuation mark earlier in 2019 with blockbuster funding rounds. Both startups were among the first female-founded companies to join the ever-expanding "unicorn club" of companies valued at or above $1 billion.

"We're increasingly seeing women from top tech companies leaving to start companies and leveraging these platforms to raise capital," Jane VC founder Jennifer Neundorfer told Business Insider. "Seeing is believing and as more women raise capital, it inspires a larger group of women to do the same. We believe this is the start of a virtuous cycle with tremendous value to be created ahead."

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The survey also found that, although most investment is concentrated in Silicon Valley, female founders are also seeing increasing investments across New York, Boston, and Los Angeles. Both Rent the Runway and Glossier are based in New York, for example.

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"One thing I'm most excited about is the extent to which New York is supportive of female founders. New York is investing in female founders at a higher rate than the Bay Area. While the Bay Area has invested nearly 3x more dollars in women, the Bay Area invests 4x more capital in total as compared to New York," former LearnVest founder turned investor Alexa von Tobel told Business Insider over email.

Female founders are on track to take in 2.9% of all venture funding across the country in 2019, a marginal increase from 2018. That this slice of the venture pie is still so small is proof to some investors that there is ample work to do in closing the funding gap.

"While this data is encouraging, there is still a lot of work to be done," Neundorfer said. "Our own survey revealed that women are systematically underfunded at the early stage, raising an average of $0.38 for every $1.00 raised by a man. There's the potential to unlock massive value by fully capitalizing female founders from the start."

Von Tobel added: "There's been tremendous conversation and work around the lack of founder diversity across the whole tech ecosystem, and we're starting to see some of that payoff. While the numbers are trending in the right direction, real change will look like improvements of 10% increments (not in the single digits)."

SEE ALSO: This CEO got $3 million from investors including Serena Williams’ VC firm to fix a problem with women’s healthcare that even the star tennis player has struggled with

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