Finland’s diversity stands out in Europe for its remarkable achievement: 30% of all VC raised by Finnish startups in 2024 went to companies founded or led by women, as reported in the Female Innovation Index. This figure far exceeds the European average of 12% and sets a new benchmark for the region.
However, as we celebrate this progress, we must ask: What does “diversity” truly mean in this context? While Finland has made significant strides in supporting female entrepreneurs, the vast majority of these founders are white women. Racial and ethnic diversity, particularly the representation of women of colour, remains notably absent from the upper echelons of the Finnish startup scene.
How Finland achieved 30% female founder VC investment
One critical factor is growing Finland’s diversity within investment teams. Over the past five years, the proportion of women in Finland’s venture capital and private equity industry has increased from 14% to 22%. This progress is especially notable at the manager level, where women now comprise nearly 40% of positions — a ten-percentage-point increase over the past five years.
Thomas Franklin, seasoned investor and CEO of Swapped ApS, noted: “To be honest, Finland’s 30% stat didn’t happen by accident. It’s structural. There is a different baseline of trust in institutions and a cultural tilt toward equity that becomes evident early on, as seen in how children are taught and how boards are established. Investors actively seek founders who bring diverse perspectives, and they view female founders as high-opportunity, not high-risk. You can’t fake that mindset. It’s baked in from the start.”
Paavo Räisänen, Partner at Maki.VC, attributes Finland’s success to deliberate action: “Finland’s startup ecosystem is thriving, built on strong foundations like equal access to education and a supportive environment for entrepreneurship. But from an investor’s perspective, what drives that 30% figure is intentional capital allocation. … We don’t treat diversity as a side initiative. It’s built into our investment strategy and how we identify, support, and scale the best talent.”
This approach is reflected in the numbers: at Maki.VC, 33% of capital has been invested in companies with at least one female founder, and diversity is embedded at every stage of the investment process.
Anna Müller, co-founder of Bought App, highlights the impact of Finland’s egalitarian culture: “As a Finnish Gen Z founder, I grew up in a country with a female leader and authorities such as teachers who didn’t see my possibilities differently than my male peers. During my studies, my engineering program at university had an exceptional 50/50 gender split. … The more young people there are around the startup ecosystem early, the more likely they are to see entrepreneurship as a path for themselves, regardless of gender or background.”
However, as industry leaders point out, diversity must go beyond gender. “Failing to prioritise DEI issues in VC will limit Finland’s growth potential, especially considering the country’s population structure and the impending shortage of skilled workers. Finland needs to prioritise not just gender diversity, but also racial and ethnic diversity to attract international talent and remain competitive,” notes a recent industry analysis.
To address this, organisations like Herizon have emerged, providing growth hacking training and job opportunities for immigrant women in Finland. Herizon has trained over 200 immigrant women and has a pipeline of more than 1,000 highly educated women, many of whom never previously considered tech careers. Such initiatives are a step toward true inclusion, but their impact is still just beginning to be felt at the founder and leadership levels.
Hidden barriers: From pitch feedback to network access
Despite these advances, obstacles remain. Franklin points to the subtler forms of bias: “The barriers are still there. Pitch feedback is softer for men, harsher for women. Expectations are higher, and the margin for error is lower. I’ve seen two identical decks (with the same numbers and product), but the female-led one received twice the scrutiny. Education isn’t the problem. Access is. The network effect still tends to favour male founders. The fix? LPs need to demand portfolio diversity with teeth. Not guidelines, but thresholds.”
Mona Saurén, ESG Analyst at Maki.VC, adds, “Unconscious bias remains one of the most persistent barriers. Investors tend to back founders who feel familiar, often those who look like them or share similar backgrounds. This influences everything from who gets a meeting to who ultimately gets funded.”
Müller states: “Women might feel like the ‘only one in the room’ in many networking events. Funds focused on supporting underrepresented founders and transparency in venture fund demographics and portfolio diversity are potential solutions.”
There’s also a significant confidence gap. According to research, 53% of Finnish men believe they have the required knowledge and skills to start a business, compared to only 32% of women. This confidence gap is reflected in entrepreneurial activity rates, with men’s entrepreneurial activity at 12.2% compared to women’s 6.9%.
Laura Koivusalo, CEO and founder of StemSight, notes: “The government has also implemented equal parental leave policies, which is shifting the culture to be more permissive for men to take equal care responsibilities. The more women believe it’s possible to combine family and running a business, the more female entrepreneurs we’ll see.”
The power of diversity: Why it matters?
While women now comprise nearly 40% of manager-level roles in VC firms, only 15% hold partner-level positions, where investment decisions are typically made. And when it comes to racial and ethnic diversity, the numbers are even lower. However, comprehensive data is still lacking — a fact that, in itself, highlights the need for greater transparency and intentionality.
As Sarita Runeberg, CEO of Maria 01, notes: “One of the biggest barriers is the lack of diversity in investor networks and decision-making bodies. Founders often receive funding from individuals who resemble them or share their background, so if those rooms aren’t diverse, the outcomes won’t be either.”
Women are more likely to found consumer startups than tech startups, and female-founded companies are still largely missing from Finland’s fastest-scaling startups. Koivusalo points out: “While it’s certainly possible to achieve huge success in B2C, it’s rarer than in the tech sector. I’d love to see more female-founded and -led tech unicorns!”
Research consistently demonstrates that gender-diverse investment teams are more likely to fund diverse founding teams. Studies have found that gender-diverse investment teams are twice as likely to invest in gender-diverse founding teams and three times as likely to back companies with female CEOs.
Mari Granström, CEO of Origin by Ocean, emphasises the business case: “It has been shown that female-led startups are being more successful when it comes to developing a company culture and business growth and overall sustainability. I dare to say that the emotional intelligence of females is playing a big role in building relationships with investors and other business partners.”
Beyond the 30%: Expanding the definition of Finland’s diversity
Finland’s journey is far from over. The country has established effective mechanisms through diverse investment teams and strategic capital allocation, but tackling the confidence gap and educational disparities is vital for further progress.
Johanna Småros, co-founder of RELEX Solutions, is optimistic: “There is still a lot of work to be done, and real change will take time, but I’m optimistic that we can reach a point where gender is a non-issue in the startup ecosystem. That said, gender isn’t the only diversity factor that matters. I would love to see more founders with diverse backgrounds who can bring much-needed additional perspectives into the startup ecosystem.”
Koivusalo concludes: “There is promise in the air for female funding in Finland. With more women getting funded and discussing it, we can provide more diverse examples to future founders. As with any minority, you always stand as a representative of your entire group, so there is also a certain pressure for women to succeed. But the numbers on ROI speak for themselves in favour of female-founded and diverse teams.”
Finland’s structured and intentional approach, along with its commitment to diversity, has set a new benchmark for Europe. The challenge now is to broaden this progress to all forms of diversity and ensure that the momentum continues to build a genuinely inclusive startup ecosystem. As more women get funded and share their stories, the ecosystem becomes more inclusive, inspiring the next generation of diverse founders.
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