In the first half of 2021, venture funding hit a record high of $288 billion, far outstripping global investment during the same period last year. But this windfall hasn’t offset the inequities endemic to the venture capital industry: Over the first eight months of 2021, the share of funding dollars raised by companies with only female founders was just 2.2%, the lowest such figure in years, according to a Crunchbase analysis.
A driving force behind this imbalance is the limited pool of women in venture capital who are empowered to write checks. As of 2020, advocacy group All Raise found that just over 13% of check writers in VC are women.
A new fund wants to chip away at this disparity, by centering South Asian women as both investors and founders. The Neythri Futures Fund has raised $10 million for its debut fund from 249 limited partners (LPs), the majority of whom are South Asian women and first-time investors. Among the fund’s LPs are senior women at companies like Peloton and Google, along with notable South Asian male leaders, such as Navin Chaddha of Mayfield Fund and VMware CEO Raghu Raghuram.
The fund grew out of founding managing partner Mythili Sankaran’s own frustrating experience trying to raise funding as an entrepreneur in the mid-aughts, which inspired her to try her hand at angel investing. As she joined women-led investing networks, Sankaran found that she rarely encountered women of color, let alone South Asian women. “It hit me, the more I got involved, how homogenous those networks were,” she says. “In my personal networks, which were predominantly South Asian, I knew plenty of incredible women.”
Sankaran started holding informal gatherings at her home with women she knew, where she shared investing insights over a cup of chai. “Suddenly I had 50 people in my backyard,” she says. “I quickly realized it was important to build a community.” In March 2020, she cofounded Neythri.org, a professional network for South Asian women, which has since grown to encompass more than 2,000 women across 14 countries.
The organization was a natural launching pad for what would eventually become the Neythri Futures Fund, as Sankaran quickly realized many members were interested in investing but had no idea where to start. “These were senior folks, too—people who were general managers and VPs and execs—who had never done this,” she says. “It seemed like there absolutely was a need to tap into this community. I wanted to create something that was very inclusive and accessible for a broad group of women.” (Sankaran oversees fundraising and operations but makes investment decisions in tandem with partner Roli Saxena, a president at NextRoll.)
The fund has already invested in nine B2B companies—of which five are helmed by female founders—and Sankaran plans to continue backing startups with diverse leadership (including at least one woman on either the executive team or board). While other funds of this size often target early-stage startups, Sankaran is open to financing more mature companies, in part, because so many of Neythri’s LPs are new to investing. “We want them to see earlier returns than [waiting] seven to ten years,” she says. “I want them to believe that this can be a path to wealth creation.”