The Bridge Effect: Changing Funding To Benefit VC As A Whole

It’s no secret that women founders have struggled — and continue to struggle — to obtain the venture capital they need to fund the businesses they’ve dreamt up. 

In 2023, almost half of new business owners were women, yet women-only founded companies received a mere 2% of all venture capital (VC) funding (and women of color founders only 0.39%). This statistic may have sent shockwaves through the VC world when it made headlines, but it has existed for years. And new data released this month, revealed a downward trend in 2024 — women-led companies received just 1% of VC funding last year. Critically, it was early-stage funding that was most deeply affected. 

What often gets overlooked, however, is how this funding gap has affected venture capital as a whole. While women-founded companies frequently struggle to attain the funding they need to ascend as VC’s next unicorns, they’re also repeatedly VC’s highest earners. We’re underfunding an entire segment of our most profitable founders. Imagine what would happen if we inverted that narrative. 

Consider these stats: 

Source: Wells Fargo 

• According to research conducted by Wells Fargo, women-owned businesses have also outperformed their male-owned counterparts in every growth category in recent years, including during the pandemic.
  
• Between 2019 and 2023, women-owned businesses added $579.6 billion in revenue to the U.S. economy and created 1.4 million jobs.
  
• Research conducted by the consulting firm BCG revealed that startups with at least one female co-founder generate 10% more revenue over a five-year period than male-founded companies.
  
• Women-led tech companies achieve 35% higher ROI and 12% higher revenue than male-led businesses when venture-backed.
  
• For every dollar of funding they receive, female-founded startups generate 78 cents in revenue (versus an average of 31 cents by male-founded companies).

Perhaps most importantly to those in the business of funding, they’re also great for an immediate return on investment. Recent data reveals that women-led companies have a lower burn rate per month (roughly $50,000 less than the U.S. average of $320,000), and they reach successful exits several months sooner than the U.S. average as well. 

Source: Pitchbook 

Imagine two sides of a ravine. On one side stands venture capital, a world constantly in search of new industry pioneers; on the other, untapped founders with a proven track record of innovating, executing, and earning. What if we could build a bridge between the two? 

We’d cross into a brand new territory with untold opportunities. 

How Women Bridge the Gap    

During their combined 25+ years of working in finance, AMH Catalyst Center’s co-founders Jenny Flores and Grace Lee have witnessed firsthand the power of bridging gaps in order to tap into new markets. 

Before launching AMH, Flores and Lee co-designed a $420 million small business relief initiative during the height of the pandemic — a bold response to a moment of unprecedented economic crisis. The effort prioritized entrepreneurs often excluded from traditional funding pipelines, including women, people of color, and low- to moderate-income business owners. The results were striking: over $2.1 billion in economic impact and a 5x return on investment, driven by the very founders the system tends to overlook.

Now, Flores and Lee have launched AMH to champion and fund even more founders who bring powerful and unique perspectives to entrepreneurship.  

“As the daughter of immigrants, I learned from an early age that serving as a bridge could create solutions,” says Flores. “You learn how to walk into a room of people who maybe don’t share your background or experiences, and you find a way to connect. You take those differences and leverage them. It’s not so much that you see the world differently, but you see it from different angles. That’s where you find unexpected ideas and solutions, and that’s exactly what VC needs.” 

Lee agrees. “One of the most powerful ways to create growth is to look for the gap between two ambitious and successful groups, then figure out a solution that brings them together,” she says. “Once you connect them, everything starts firing. We believe — and the data shows — that women are the bridge-builders that venture capital needs to keep innovating.” 

AMH seeks to change how women find investment by using cutting-edge AI and blockchain technology to create more flow, insight, and transparency. The goal is to help some of the most ambitious ventures get exactly the funding they need faster and more efficiently. 

"We're not just working within the system — we're building a better one. That’s a tall order, but we started AMH with a goal of doing what’s right for women founders, for the economy and for VC as an industry,” says Flores. “Gaps happen, but by building our way across them, we can get more funding to companies proven to benefit VC as a whole. There is no limit to what these entrepreneurs can accomplish when we give them the tools and investment they need.”