Microsoft’s two-year-old venture fund, M12, is running a competition for business-focused women-led tech startups and will give two winners $2 million each in funding.
According to Microsoft, companies founded solely by women represented just 2.2 percent of all venture capital funding in the US last year, according to data from industry tracker Pitchbook. Yet, research consistently shows that women-led companies tend to generate better returns.
M12 (“M” for Microsoft, 12 for the number of letters in “entrepreneur”) was created in 2014 by former Qualcomm executive Peggy as an effort to identify promising startups Microsoft can both invest in and support with access to its technology. Last year, the company held an artificial intelligence competition called innovate.ai, awarding $3.5 million to startups working on medical technology, privacy and speech recognition.
This time, Johnson said she wanted to tackle diversity more directly. Despite Microsoft’s diversity efforts, for example, just 7.5 percent of M12’s portfolio companies are founded by women. And while Johnson said that’s above the industry average of about 5 percent, it’s not enough.
“We need more” women in tech, she said.
Microsoft will accept submissions for its competition from Thursday to September 30 from applicants in North America, Europe and Israel.