It’s no secret that venture capital (VC) has long excluded entire groups of founders.

Most people are familiar with the figure that women receive only 2% of all VC funding, a number that’s barely moved in decades. But fewer know that LGBTQ+ founders receive even less – under 1%.

Related

Corporations perform better in every way when they have LGBTQ+ board members
Despite the clear advantages shown in the data, only a miniscule number of board seats are held by out LGBTQ+ people.

In practice, this means that LGBTQ+ innovators with viable, high-potential businesses are still routinely overlooked or passed over – not because their ideas are weak, but because they don’t match the image investors are accustomed to funding.

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This isn’t speculation. It’s backed by data and echoed in personal stories from founders across the country. According to a UK survey reported by CNBC, 75% of LGBTQ+ founders hide their identity when pitching to investors. PinkNews reports that LGBTQ+ entrepreneurs are “going back into the closet” to appear more fundable. Some omit personal details, change their appearance, or avoid using inclusive language – all to increase their odds of being taken seriously in a pitch room.

These patterns are real. And we saw them repeatedly while filming Show Her the Money, an award-winning documentary focused on the gender funding gap in venture capital. While the film focuses on the funding gap for women, about half of the featured cast members (founders and investors) identify as LGBTQ+ women. The overlap wasn’t intentional – it happened organically.

The stories were striking. Founders shared how they felt the need to dress more conservatively, skip personal anecdotes, or “straighten up” their bios to make investors comfortable. The emotional labor it takes to code-switch while asking for funding is exhausting, and it’s happening every day in boardrooms, Zoom calls, and demo days across the country.

But buried in those challenges were moments of something else: clarity, courage, and connection.

There’s something powerful about a founder walking into a room, leading with authenticity, and finding the right investor who sees them fully. It doesn’t just fund a business; it affirms a person. And when that happens, you can feel the shift. We witnessed it during filming, and we’ve continued seeing it at screenings in over 100 cities. From New York to Chattanooga, we hear from LGBTQ+ founders who finally feel seen, and from investors who are realizing what they’ve been missing.

Still, there’s a long way to go.

VC culture tends to reward familiarity. Investors often fund people who remind them of themselves or other successful founders they’ve backed. It’s not malicious, it’s subconscious pattern-matching. But when the pattern has always been cis, straight, white men, it means brilliant LGBTQ+ entrepreneurs get passed over simply for being different.

That needs to stop.

And the frustrating part? There’s no financial logic behind it. LGBTQ+-led companies are outperforming expectations, building strong teams, creating jobs, and delivering returns. Backing LGBTQ+ founders isn’t charity, it’s good business. More VCs are starting to take note, and organizations like She Angels Investors and Gaingels are working to close the gap. But we need more people – on both sides of the table – pushing this forward.

In the last few years, the number of women angel investors has risen to 40%. That’s a real sign of momentum. The same growth is possible and necessary for LGBTQ+ investors. Because the people making funding decisions shape what products, services, and solutions get built. If we want the future to reflect everyone, we need to invest in everyone.

So how do we change this?

Here’s where to start:

• If you’re an investor, look closer at who isn’t being included. Funders who expand their networks and redefine what “founder material” looks like are already seeing better returns. Seek out funds prioritizing diversity, and listen to founders whose voices you haven’t heard enough.
  
• If you’re a founder, don’t dim yourself. There are people looking to fund exactly what you bring to the table. Check out groups like Gaingels, Astia, or Power to Pitch, and visit showherthemoneymovie.com for access to pitch prep resources and funding opportunities.
  
• If you’re in a position to build or influence ecosystems, accelerators, pitch events, mentorship programs – rethink your criteria. Who gets invited to speak? Who gets on stage? Who’s missing, and why?
  
• If you’re outside of this space entirely, your voice still matters. Read the data. Share these findings. Champion LGBTQ+-led businesses and question why inclusion is still an afterthought in so many boardrooms.
  

The problems are clear. The solutions are available. What’s missing in many cases is the willingness to shift the default.

The truth is: When we fund LGBTQ+ founders, we’re not just promoting equity; we’re backing smart, visionary, high-impact businesses. It’s time to make that the norm, not the exception.

If you’re still wondering how to help, start here:

• Ask who’s missing from your table.
  
• Fund what you want the future to look like.
  
• Be louder than the biases that still linger.
  

Because when we invest in founders who have been left out – not despite who they are, but because of the perspectives they bring – we don’t just change business.

We change what’s possible.

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