Female Investors Surge in Healthcare VC: Shifting Battlefields and Rising Influence

In 2015,Lu Qinchao Becomes Sequoia Capital’s First Female Global Partner, three years later, she co-founded the company with Su Zhenbo, former managing partner of Fenxiang Investment ManagementDanlu Capital, continuing to focus on early-stage healthcare investments. Both of these developments have led to greater recognition of women in the venture capital community.

In fact, in the year Lu Qinchao founded Danlu Capital, the entire healthcare venture capital and private equity sector was undergoing certain changes:On one hand, there is the rare emergence of venture capital funds co-founded by women; on the other, an increasing number of women are entering the healthcare sector as investors and gradually rising to executive positions within institutions.For a time, the proportion of female investors and their decision-making authority within institutions have both seen a significant increase compared to the past.

Amid the rapid development of the healthcare industry in recent years, this group of young female investors has now stepped into the spotlight. According to incomplete statistics from the VCBeat Orange Database,In the Medical Field This Year(January 1, 2023–March 7, 2023)Of the 55 early-stage financing deals that have occurred, 24 were led or participated in by female investors, accounting for nearly half., and it is worth noting that 90% of these startups led by female investors are hard-tech enterprises.

This is no easy feat. On one hand, the primary and secondary markets in the healthcare sector have experienced significant volatility in recent years, with each minor surge invariably followed by a small bubble. As uncertainty and risk in the capital market become increasingly pronounced, female investors are facing unprecedented challenges. On the other hand, while female investors predominantly focused on the consumer and service sectors in previous years, they are now shifting their “main battlefield,” turning their attention to hard technology and early-stage innovation.

Why have such changes occurred? What do these shifts signify for the healthcare industry, which is rapidly developing and continuously iterating? To find the answers, VCBeat andFive Female Investors from Top Healthcare Capital FirmsChatted with someone.

Is the Proportion of Female Investors Really Rising? Five female investors unanimously affirmed this in interviews, as they have keenly observed a growing number of women around them. A partner at a certain firm remarked, “Before I joined, there were very few women in the investment department, but now there are many. In fact, it’s not just us; other firms are seeing the same trend. Moreover, we now see many female investors at various conferences, a sight that was rarely seen before.”

However, what is not immediately apparent is not only the rise in the number of female investors,Their positions within the institution have continued to rise., such as Lu Qinchao, Founding and Managing Partner of Danlu Investment; Yang Yunxia, Partner at Sequoia Capital China; Liang Yingyu, Managing Partner at Qiming Venture Partners; Yu Fang, Partner at Northern Light Venture Capital; Huang Li, Founding Partner of Cowin Capital; and Liu Qianye, Founding Partner of Bencao Capital. They have all assumed increasingly important roles within their respective institutions.

Finally, there are the shifts in their areas of focus. In previous years, female investors were invariably associated with the consumer or service sectors, butNowadays, they are also shifting their focus to hard tech and early-stage innovation.

What Do All These Changes Signify?

We can start by examining it from the outside.In recent years, the healthcare industry has experienced rapid development, with substantial capital inflows driving the market size from hundreds of billions to trillions of yuan. This expansion has further intensified the industry’s demand for talent. Additionally, as clinical needs continue to evolve and new technologies advance at a brisk pace, the healthcare sector is exhibiting increasing diversification. These trends have created more professional opportunities for female investors.

However, the talent window opened by the industry’s rapid growth is only one facet; another critical aspect is the shifting profile of founders. In previous years, the venture capital and private equity community primarily focused on traditional sectors dominated by manufacturing. Founders tended to be older, and the industry culture was heavily influenced by traditional “jianghu” norms, making it difficult for female investors to gain traction. For example, in a specific scenario, male investors might establish rapport with founders over a cigarette, an approach that is often inaccessible or inappropriate for female investors.

But today, as the medical sector increasingly extends into original innovation, a large number of scientists are moving into industry. The setting for exchanges has shifted from the drinking table to the coffee shop. Moreover, since both founders and investors today are predominantly trained in technical fields, they share similar backgrounds, making communication much easier than before.

Another point is the rise in women’s decision-making power within investment firms. Just as an increase in the number of female investors naturally leads to more female entrepreneurs securing venture capital, this “butterfly effect” centered on women is indeed a reality in today’s investment industry.

Having examined the external factors, we now turn our attention to female investors themselves.Among the five female investors interviewed, their responses to the question of why they chose to become investors were all straightforward.It is a genuine passion for this industry, free from any ulterior motives.

However, in an industry that prioritizes tangible returns, passion alone is clearly insufficient; it is professional competence that determines whether women can sustain their careers as investors.

In fact, most female investors today possess a keen understanding of technology itself. Coupled with their strong learning abilities and the increasingly mature training systems for investors within the industry, they are able to rapidly enhance their professional expertise. This is evident in early-stage investments in the healthcare sector over the past one to two years,Significant Rise in Female Investor Participation and Increased ReturnsKey data points clearly validate this trend. After all, the market is the best proof.

Currently, China’s healthcare industry is entering a new development cycle. Imitative innovation is nearing its end, while original innovation and the commercialization of research outcomes are taking its place as the central theme in healthcare venture capital and investment. Under this overarching trend, every investor faces both opportunities and challenges.So, as a female investor, do you have any unique advantages in the current venture capital environment, which is themed around hard tech and early-stage innovation?

In response to this question, five female investors shared their perspectives during interviews. VCBeat has compiled these responses and distilled them into three keywords:Communication, PatienceHeartandStable. Through these three keywords, we see female investors’ new definition of the early-stage healthcare market.

The first keyword is communication, from which the core competencies of female investors—approachability and a more nuanced observation and understanding of entrepreneurs—are derived.

Against the backdrop of the current surge in hard-tech innovation, an increasing number of scientists are transitioning from laboratories to industry, and investors are following suit, gradually stepping out of their comfort zones to engage more closely with scientists. Although both parties are moving toward each other, they originate from entirely different training systems and have distinct focal points: scientists prioritize the technology itself, whereas investors place greater emphasis on industrial value. Therefore, effective communication is particularly crucial.

As previously mentioned, a solid understanding of technology has become a prerequisite for investors today, enabling entrepreneurs to quickly build trust. Beyond this, a certain degree of approachability can further strengthen that trust. For most entrepreneurs, engaging with investors is a relatively unfamiliar experience that requires them to receive and process substantial amounts of information; therefore, a more amicable and composed demeanor makes it easier for scientist-founders to accept and engage.

Beyond this, sustained communication and deep understanding are also effective ways to provide long-term companionship to portfolio companies and offer continuous support to entrepreneurs. Tang Yinan from Yuan Yi Capital believes that entrepreneurial growth is measured in years, and given the “non-consensus” nature of early-stage innovative projects, entrepreneurs often feel lonely during their startup journey. Therefore, so-called post-investment value addition is not limited to the tangible resources investors can bring to a company; sometimes, understanding and mutual trust themselves can empower founders. Having someone who truly understands and can consult with during times of confusion is actually very important in the entrepreneurial process. Female investors, naturally more emotionally attuned, are often better positioned to observe subtle psychological changes in entrepreneurs.

The second keyword is patience, from which stems the core competency of female investors: providing founders with longer-term companionship and fostering a more diversified understanding of a project’s long-term value.

The allure of early-stage investment lies in the inherent uncertainty of both its risks and returns. Investors can only mitigate risk to the greatest extent possible through comprehensive observation. Female investors, in particular, tend to exhibit greater patience, which is well-integrated throughout the investment process. Specifically, during the due diligence phase, female investors make more thorough preparations. In communications with founders, they not only focus on the technology itself but also excel at observing the scientists and their underlying teams. In the post-investment stage, female investors are willing to devote more time to accompanying scientists in their growth journey.

A senior female partner noted that female investors tend not to exert excessive pressure on founders; even when a company’s current performance is subpar, they are often willing to grant the founding team more time and space.

This also reflects the tendency of female investors to more readily recognize the long-term value of early-stage projects. Among the five female investors interviewed, nearly all had projects they monitored for one or even two years before investing.Femtosecond TechnologyThis is a typical case: in December 2021, Femtosecond Research Center (Guangzhou) completed a tens-of-millions-of-yuan Pre-A financing round, exclusively invested by Yuanyi Capital.

According to Tang Yinan from Yuanyi Capital, she first came into contact with Femtosecond in the second half of 2020. At that time, however, she did not resonate strongly with the project, primarily because her understanding of the transformative impact it could bring to the industry was not yet profound. Nevertheless, Tang Yinan continued to monitor the project and maintained ongoing communication with its founders. As her understanding of the industry deepened, and through indirect insights gained from another similar project, she suddenly recognized the value of Femtosecond and completed the investment by the end of 2021. A full year elapsed between her initial contact and the completion of the investment.

Therefore,Many aspects of early-stage investments are not immediately apparent, as there may be no benchmarks for comparison, or even no established track in the sector., so it truly takes time for the real value of a project to emerge and become visible, which requires investors to have sufficient patience.

Sun Shanshan of Proxima Ventures also strongly agrees with this point, “In venture capital,The most frightening thing is not knowing nothing at all, but rather knowing only 30% and using that limited understanding to assess the entire industry, which makes your judgments highly prone to error., so it still takes time to settle and reflect. Female investors are more prone to self-reflection, which can become their advantage.”

The third keyword is stability, from which the core competencies derived are female investors’ persistence in career growth and their ability to manage project risks.

Although venture capital is highly aggressive and requires sufficient proactivity to achieve results, it also demands balance and stability. In an interview, Sun Shanshan from Proxima Venture Partners noted that female investors tend to be more prudent; they conduct more thorough preparation in the early stages and consider a wider range of factors. Moreover, they generally maintain emotional stability, are less susceptible to market fluctuations, and possess a strong awareness of risk mitigation.

Another manifestation of “stability” among female investors lies in their career choices; they may be more inclined to remain within a single institution or industry for an extended period. This is indeed significant. On one hand, early-stage investing is inherently an investment in the future, as many technological applications require three to five years to demonstrate their market value. On the other hand, early-stage investment necessitates accompanying companies through their growth journey; if an investor departs abruptly, it could have a certain impact on the enterprise.

In fact, investment is a relatively independent process. Each institution and investor has their own logic of thinking and methods of verification. However, regardless of who they are, there are certain prerequisites that investors must possess, such as professional expertise and a deep understanding of technology. For female investors, their superior communication skills, along with the patience and balance demonstrated throughout the investment process, often enable them to uncover more possibilities during industrial transformations. The rapid increase in the proportion of female investors seems to prove that the healthcare industry is gradually moving in a better direction.

When discussing the current challenges faced by female investors, a senior female partner shared an investment case from her own experience. According to her account, although the portfolio company possessed leading-edge technology and operated in a large market space, investors were initially unenthusiastic. The primary reason was the founder’s identity: she was young and attractive, which led investors to doubt her ability to manage and operate such a company.

In fact, it is not only female founders who are easily labeled as “lacking in professional competence”; female investors face the same stereotype.Rebeca Hwang, Executive Partner at Rivet VenturesShe once stated in an interview that when attending industry conferences, she was often mistaken for a sales representative or a media relations specialist. However, when she introduced herself as a partner at the firm, she would invariably receive peculiar looks—all because she is a woman.

Beyond the distrust imposed on women due to inherent biases, balancing family and work is also a major challenge for female investors.. A senior female partner told VCBeat, “When she was in school, the top ten students were basically all women, but as time went on, especially by the age of 40, it became evident that they had largely disappeared from the industry. Women may naturally have to devote more to their families.”

But these constraints are gradually being shed by female investors.On one hand, a substantial body of case studies and real-world data demonstrates their professional expertise in venture capital and private equity, gradually earning the trust of founders and institutions. On the other hand, as the industry matures, founders—much like investors who are increasingly focusing on technology itself—are placing greater emphasis on an investor’s depth of technological understanding and ability to provide tangible value, irrespective of whether the investor is female.

In fact, within the entire venture capital and investment community in the current healthcare sector, the rise of female power represents not only investors,FA、IR、PRKey roles in the investment industry are also predominantly held by women, which explains why Tang Yinan remarked that from front-office to back-office positions, the workforce is now largely female.

The rules of the capital market have always been cold and impersonal. As a result, the “hunting ground” of venture capital has historically been dominated by men. Yet there remain some “extraordinary women” who are highly professional, combining resilience with grace. In the current environment, where hard technology and early-stage innovation take center stage, they are returning to the essence of investment, continuously seeking out startups with true disruptive potential, and making a powerful and impressive mark in the healthcare venture capital circle.