New study uncovers ‘diversity crisis’ at Web3 start-ups

Ellie Duncan
20 Feb 2023

Only 13% of Web3 companies have a woman on their founding team, while male-founded Web3 start-ups raise almost four times more capital than those founded by women, according to new research.

The findings are the result of a study published by BCG X, the tech build and design unit of Boston Consulting Group (BCG), and People of Crypto Lab, which is a studio that aims to boost diversity, equity, and inclusion in the Web3 ecosystem.

The study, ‘Web3 Already Has a Gender Diversity Problem’, revealed that just 3% of Web3 companies have a team that is exclusively made up of women.

Web3 companies are defined by BCG X as those developing “radical new applications” involving the metaverse, blockchain technologies, and cryptocurrencies.

Meanwhile, all-male founding teams raise nearly four times as much, on average, as all-female teams – nearly $30 million compared to about $8 million.

In addition, the study found that none of the Web3 companies that have raised more than $100 million have an all-female founding team.

Jessica Apotheker, BCG’s chief marketing officer and co-author of the study, called the findings “alarming”.

“This is an economic as well as a diversity crisis, with opportunities being missed to back and scale businesses designed with female customers in mind,” she said.

She added that the gender gap in Web3 is “an even bigger problem than what we’ve long known about in STEM [science, technology, engineering and math] companies overall”.

The report revealed that among all employees at top Web3 startups, the share of women is higher, at approximately 27%. However, women are often “clustered” in non-technical roles, such as HR and marketing.

By comparison, in the overall workforce in STEM-based fields women make up 33% of the workforce, with 25% filling technical roles.

Apotheker added: “BCG research has found that companies with diverse leadership teams are better at innovation and more profitable.”

She warned that Web3 companies risk foregoing a “huge business and monetisation opportunity”, if they do not embrace diversity.

Simone Berry, co-founder of People of Crypto Lab and co-author of the study, said: “Despite the current ecosystem being biased towards men, we are very early in development with an incredible opportunity to not repeat past mistakes and ensure that women have the resources and funding they need to lead the new digital economy.”

The study is based on BCG X’s and People of Crypto Lab’s analysis of the gender diversity of founders and investors using a database from Crunchbase consisting of nearly 2,800 participants.

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