By: Techstars Tech Central Sydney Accelerator Managing Director Kirstin Hunter

Earlier this year California became the first jurisdiction to introduce mandatory reporting for venture capital firms to report the demographics of the founder teams that they invest in. In solidarity with the intention behind this bill - that greater transparency leads to greater diversity - a number of venture capital firms in Australia have voluntarily committed to disclose their own data as relates to gender diversity in founder teams.

One of our core values at Techstars is that good ideas can come from anywhere. 

This informs our business model (with small local accelerators embedding within an ecosystem) as well as our approach to selecting diverse founder teams. We’re proud of our track record as one of the world’s leading investors into women-founded businesses.

Against this background I’m happy to share the results of the first Techstars Tech Central Sydney Accelerator powered by the NSW Government.

Summary-level numbers

As part of the Equity Clear initiative, VC funds and investor groups are voluntarily disclosing their data in a standardised format. Applying this approach, the diversity statistics for the Techstars Tech Central Sydney Accelerator powered by the NSW Government for 2023 were as follows:

* Data separating teams with at least one founder identifying as a woman and all-woman teams not collected at application level, therefore all applications with at least one founder who identified as a woman are rolled up into mixed (gender diverse) teams. 

** Shows deals progressed to second-round interview (top 40 teams)

Gender diversity across our sourcing process

In a show of greater transparency, I would like to share more about the investment logic that delivered such a diverse portfolio of companies in the 2023 Techstars Tech Central accelerator. 

As an investor, it is my job to invest my LPs’ capital to generate returns on their investment. 

In study after study, it has been shown that companies founded by women and gender-diverse teams are more likely to produce outsized returns. As a direct result, part of my investment thesis is that I will increase the likelihood of delivering outsized returns for my LPs by increasing the proportion of companies founded by women and gender-diverse teams in my portfolio.

Our accelerator selection process incorporates two rounds of interviews, followed by a presentation to a screening committee. After the screening committee, I select the final 12 companies to participate in the accelerator (and receive investment of up to USD$120,000).

The following chart shows the breakdown of men-only, women-only, and mixed (gender-diverse) teams across each stage in our selection process. The proportion of teams with at least one woman founder increases from 24% at application level to 58% at final selection. (Note: we are not able to disaggregate the data into women-only from gender-diverse teams at application level, so have shown all companies with at least one woman founder as mixed (gender-diverse) gender teams)

Representation within founder support structures

We are also conscious of the diversity across our founder support structures, which include our program team, the mentors we work with, and the investors we invite to meet with our founders within the program.

Program team

The Techstars Tech Central program team in 2023 was all women, with Managing Director Kirstin Hunter bringing 20 years of experience as a founder, startup executive and management consultant. Program Manager Lauren Fong has several years of experience as an investor, and Operations Associate Gwen Masonsong brings research, social media and content production experience.

The program team was supported by three entrepreneurs in residence: Jenny Rudd, Simon Scarf, and Melanie Robb.

Mentors The program attracted support from 124 mentors, comprising current and former founders, startup leaders, operators, industry experts and government representatives.

Of the 124 mentors, 30% identify as women.

A sample of mentors who supported the founders who took part in the Techstars Tech Central Sydney Accelerator.

Investors

Over the course of the program, founders were introduced to 115 investors, through events such as investor speed dating and the angel investor practice pitch night.

We actively sought to create opportunities for women investors to meet the founders, including hosting one dedicated investor speed dating event where only women investors were invited to attend.

We are particularly proud to share that of the 115 individual investors who had the opportunity to meet our founders, 45% identified as women. 

Final thoughts

With the vast array of data showing that women-founded and mixed-gender founder teams are more likely to produce greater returns for investors, more and more investors are setting an ambition to increase the number of diverse teams in their investment portfolios.

My advice to other investors who are looking to improve their own portfolio diversity is to be hyper-aware of diversity at all stages of your sourcing funnel - even before founders enter your funnel! One of the initiatives that I introduced for this accelerator was to open my calendar for “founder office hours”, and then intentionally seek introductions to women founders and founders of colour from VCs and ecosystem leaders. Through these 1:1 chats I met so many incredible founders from all different backgrounds, several of whom I was able to encourage to apply despite their initial concern that they were not advanced enough for an accelerator (they were!)

My second piece of advice is to be conscious of the environment that you create for your women founders. It is not enough to grant entry to a program if your women founders still feel like they do not belong. If the mentors, leaders, investors and speakers that form part of your founder support network are men, this sends a subtle but powerful message that success in startups is a male-only endeavour. At Techstars Tech Central we deliberately built relationships with women mentors, speakers and investors, so that our founders could see models of success that they could relate to across all areas of our network.

We are so proud of the diversity of our first-ever accelerator at Techstars Tech Central Sydney, and even more proud of the incredible businesses that have graduated from this program. We look forward to selecting our 2024 class with applications opening early in 2024 - if you’re interested in joining us, you can check out our program page here.

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