A recent lawsuit, in which a former president at Insight Partners sued the company for gender discrimination and other workplace misconduct, has highlighted the ongoing diversity challenges women face in investing and other male-dominated industries. Investors warn that, in terms of diversity in VC funding, many countries remain far behind.
The Trump administration’s actions aimed at eliminating diversity initiatives in the U.S., along with some U.S. companies scaling back or cutting diversity programs, suggest that the momentum for diversity could diminish in the U.S.
The McKinsey Women in the Workplace report highlights that some companies have scaled back or discontinued career development programs designed to support women. Meanwhile, the latest Pitchbook data shows that in recent years, US and European companies founded or co-founded by women have received a smaller share of total deals compared to previous years.
In certain regions, such as Central and Eastern Europe (CEE), funding for female-led companies remains exceptionally rare. Since 2008, women-founded startups in Europe have attracted €8.8 billion across 5,933 deals, based on the country where the companies are headquartered. However, in countries like Serbia, Latvia, Croatia, Slovenia, and Ukraine, there have been very few publicly announced VC investments in companies led by women, the Pitchbook data shows.
When considering companies where there is at least one female co-founder, CEE countries also lag behind Western or Scandinavian ones.
According to Daiva Rakauskaitė, manager at Aneli Capital, a fund management company that supports CEE startups, one key reason is the region’s lower number of women-founded startups.
“VC is still a relationship-driven industry dominated by men, which means deals often stay within the male networks. In the CEE region, some investors are more conservative, and there are fewer women founders, which limits the opportunities for investors to support them,” Rakauskaitė explained. “I believe women should boldly enter sectors traditionally targeted by VCs. If we also apply research showing that diverse teams generate more value, VCs could unlock the potential to create even more unicorns than before.”
Several studies have demonstrated the benefits of women-led or diverse funds or companies. Harvard Business School showed that VC firms with 10% more female investment hires make more successful investments at the portfolio company level and have 9,7% profitable exits, according to the Milken Institute report. Meanwhile, a study by Grant Thornton found that diversity strategies in companies bring cultural benefits and an increase in innovation.
According to Rakauskaitė, CEE investors and startups could greatly benefit from diversity-friendly investment policies. However, she emphasizes that the focus should be on the overall quality and values of teams, rather than just gender.
“Founders of startups must focus on delivering results and demonstrating that all genders matter equally when it comes to shaping the future of the industry. Gender should not be a limiting factor in talent recognition; what matters most is the strength of the team, their vision, and their ability to execute,” Rakauskaitė said.
Looking beyond women in the VC and investment space, the McKinsey report shows that for the 11th consecutive year, women remain underrepresented, especially in senior leadership, where they hold 29% of C-suite roles.
The report shows that some problems may often arise already in entry-level positions. For example, 21% of entry-level women are encouraged by their manager to use AI, compared to 33% of men at the same level. This disparity likely contributes to the fact that just 37% of entry-level women believe AI will improve their career prospects, compared to 60% of employees overall.
According to Rakauskaitė, this shows that the future of diversity ultimately depends on managers’ actions and their personal growth as quality leaders.
“Managers have a critical responsibility to support their teams’ growth in any field – be it venture capital, investing, or business. As we look to 2026, it is crucial that we not only continue to challenge the status quo but actively foster environments where all talents, regardless of gender, are equally recognized and nurtured. This, in turn, creates added value,” Rakauskaitė concluded.