Private equity’s feminine side

Dutch firm Juneau is the latest firm to focus its investment strategy on female entrepreneurs

The gender gap in top levels of management is not just an image problem. It can have meaningful implications for company performance. So says a handful of academic studies, such as “Girl Power”, a 2008 joint study from Columbia University and the University of Maryland.

With fewer than a third of the largest US corporations not employing a single female senior executive, the study questions the ability of firms to identify and develop managerial talent. More specifically, the study observes that prior research shows “women tend to manage in a less hierarchical and more interactive style than their male counterparts, leading to more teamwork, intrinsic motivation, and ultimately creativity”.

European private equity house Juneau will aim to take full advantage. Launched by three female private equity professionals earlier this year, Juneau lays claim to be the first Dutch private equity fund to focus on entrepreneurial women. Juneau will target companies either led by a female chief executive officer or with more than 30 percent of their key decision making positions filled by women.

Juneau co-founder Désirée van Boxtel says there are numerous studies proving that gender diverse management teams are outperformers. However, despite an increasing number of female entrepreneurs and diverse management structures, “we found that female entrepreneurs and directors are not so much focused on accelerating growth with the use of private capital or even buying companies with the help of private equity”, van Boxtel tells PEI. She adds that this trend is likely to change, with Juneau helping to accelerate the process.

van Boxtel underlines the fact that the rationale behind Juneau, which is named after Juno, the ancient Roman goddess of finance, is “completely economic”, rather than stemming from any “activist cause”.

Given the weight of research into the area, it is perhaps not surprising that Juneau is not alone in its female-focused investment strategy. Other funds include Nigeria Women’s Investment Fund, London-based StarGate’s Trapezia funds and US-based Illuminate Ventures. The Trapezia funds, which claim to have been the first of their kind in Europe, also felt “compelled by research suggesting that companies with gender-diverse management teams outperform their industry average”.

If firm’s such as Juneau produce track records to match the weight of academic research, private equity investors and managers will have no choice but to pay more attention to their feminine side.