We ask men to win and women not to lose: closing the gender gap in startup funding

Kanze, D, Huang, L, Conley, M A and Higgins, E T (2018) We ask men to win and women not to lose: closing the gender gap in startup funding. Academy of Management Journal (AMJ), 61 (2). ISSN 0001-4273

Abstract

Male entrepreneurs are known to raise higher levels of funding than their female counterparts, but the underlying mechanism for this funding disparity remains contested. Drawing upon regulatory focus theory, we propose that the gap originates with a gender bias in the questions that investors pose to entrepreneurs. A field study conducted on question-and-answer interactions at TechCrunch Disrupt New York City during 2010 through 2016 reveals that investors tend to ask male entrepreneurs promotion-focused questions and female entrepreneurs prevention-focused questions, and that entrepreneurs tend to respond with matching regulatory focus. This distinction in the regulatory focus of investor questions and entrepreneur responses results in divergent funding outcomes for entrepreneurs whereby those asked promotion-focused questions raise significantly higher amounts of funding than those asked prevention-focused questions. We demonstrate that every additional prevention-focused question significantly hinders the entrepreneur’s ability to raise capital, fully mediating gender’s effect on funding. By experimentally testing an intervention, we find that entrepreneurs can significantly increase funding for their startups when responding to prevention-focused questions with promotion-focused answers. As we offer evidence regarding tactics that can be employed to diminish the gender disadvantage in funding outcomes, this study has practical as well as theoretical implications for entrepreneurship.

More Details

Item Type: Article
Subject Areas: Organisational Behaviour
Subjects: E > Entrepreneurs
V > Venture capital companies
F > Financing
Date Deposited: 05 Aug 2019 08:24
Last Modified: 02 Sep 2019 15:37
URI: http://lbsresearch.london.edu/id/eprint/1196
More

Export and Share


Download

Full text not available from this repository.

Statistics

Altmetrics
View details on Dimensions' website

Downloads from LBS Research Online

View details

Actions (login required)

Edit Item Edit Item