Gender Lens Investing In and By Private Market Funds, During the Global COVID-19 Pandemic: a View from Capital Connect

By Bahiyah Yasmeen Robinson and Suzanne Biegel

The COVID-19 Pandemic made a significant impact on gender lens investing over the last year. GenderSmart and VC Include joined forces to showcase a subset of the most dynamic global gender smart private market (VC, PE, private debt) investment funds because we recognised a massive market opportunity to drive alpha for asset allocators across strategy, asset class, and region.

This is the time to double down on gender-smart funds. Why? Because investing in alpha-generating funds led by women and diverse teams, and who are investing in women and diverse teams, could mitigate the inevitable market volatility and results of inequality globally. Whether the end user is in Myanmar or Minneapolis, many companies with EBITDA in key sectors such as fintech, healthtech, agtech, future of work, or the care economy - building resilient supply chains, driving access to underserved markets - are solving challenges and creating innovations key to spurring the type of economic growth and recovery essential to resilience for people, profit, and planet. 

Capital Connect: GP Experiences

Since December, we’ve canvased over 80 gender lens funds across the globe, as well as asset allocators from family offices, foundations, endowments, development finance institutions, and pensions. 

On the asset manager side, we focused on fund managers with private capital as well as public sector capital investment behind them. Many managers are continuing to make investments into companies that have done well because of the pandemic, bringing last mile innovations and digital tools to historically underserved markets at scale. And many are stalled from making those critical investments because capital is not moving fast enough to meet demand and opportunity.

In the US, UK, and Europe, gender-smart investors are recognising the role played by the “S” and the “G” in ESG in realising the outsized returns that have been captured over the last couple of years. In the US, we dedicated a showcase that specifically highlighted funds with a strong gender lens, and that included racial diversity in their strategy: a response to the civil rights and racial equity injustices that have been displayed on both the national and global stage. 

African fund managers across the Continent have been at work doubling down on investments in some of the deals they were in early, and which have grown significantly despite, and in some cases, because of, the pandemic. They are also seeing increased dealflow in COVID-relevant companies that they just can't touch right now, as they’re still raising their capital.  

In South East Asia, fund managers are innovating the type and flavour of capital they’re making available to entrepreneurs, to be responsive to what those entrepreneurs really need. They’re working with portfolio companies to pivot and adapt to COVID-related changes in the market, and they are building and nurturing pipeline, and helping entrepreneurs in any way they can, as they work to raise the capital into their funds. 

LP Activity and Next Steps

On the asset allocator side, momentum is starting to pick up, despite the inability to travel for due diligence, and we’re working hard to inspire investors to increase their allocations, exponentially, in this moment of opportunity. We’re seeing leaders in the space that will reap the benefits by creating relationships with and investing in the funds that are positioning themselves for market leadership in the next 3-5 years. 

Members of the 2X Collaborative are continuing to allocate into emerging markets. Bold individuals, foundations and family offices are continuing to move capital, despite the challenges of time and attention, lack of ability to travel, and personal health barriers that COVID has brought. The need and the opportunity is clear. 

We need to amp up local capital sources, and we need to continue to make the case and introduce these dynamic, resilient, creative, smart fund managers to those who can allocate or advise, and keep the momentum going.