Goldman Sachs Plans To Invest $500M In Late-Stage Companies Founded, Owned Or Led By Women

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Written by Dana Sanchez

 

Men dominate financial services and women-led businesses aren’t getting the investment they deserve, according to Goldman Sachs.

The New York City-based investment banking, securities and management giant is doing something about it. Goldman plans to invest $500 million of “our firm’s and clients’ capital” in private, late-stage, women-founded, women-owned or women-led companies, wrote Stephanie Cohen, chief strategy officer for Goldman Sachs, in a June 19 blog.

Named “Launch With GS,” the initiative includes directly funding companies as well as seeding women investment managers who are starting their own funds.

Just for perspective, Goldman Sachs had total assets of $916.8 billion in 2017, and ‎37,300 employees as of 2018.

Men make up 89 percent of partners at venture firms, and companies founded by men raised 36 times more money in 2017 than those founded by women, according to the National Venture Capital Association and PitchBook Data Inc.

“Women-led businesses don’t seem to be getting the investment they deserve,” Cohen wrote, citing these stats:

  • only 2 percent of U.S. venture capital in 2017 went to companies with all-women founding teams.
  • 12 percent of U.S. venture capital went to teams with at least one woman.
  • Less than 2 percent of U.S. private equity firms are female-owned.

Another Goldman Sachs program called 10,000 Women was launched 10 years ago to develop women-owned businesses in countries including Brazil, India and Nigeria. The program donated $100 million and taught more than 10,000 women business skills.

“Our goal with Launch With GS is to generate strong investment returns,” Cohen said. “The bottom line is this makes sense for our business – because investing and helping companies grow is our business. We also hope it makes a difference for women who have big ideas but find themselves cut out of the funding ecosystem.”