Given overall lack of gender diversity in the venture capital and entrepreneurship industry shown in Calder-Wang and Gompers (2017) we ask: What promotes greater gender diversity in hiring? Does diversity lead to better firm performance and higher investment returns? In this paper, using a unique dataset of the gender of venture capital partners’ children, we find strong evidence that when partners have more daughters, the propensity to hire female partners increases. Moreover, our instrumental variable results suggest that increased gender diversity improves deal and fund performance. Lastly, the effects are primarily driven by the gender of senior partners’ children.

We survey over 1,000 venture capitalists (VCs) on how the COVID-19 pandemic has affected their decisions and investments. Despite the historical importance of in-person meetings, VCs do not report difficulty finding quality entrepreneurs or major changes in time allocation. They do report difficulty in evaluating deals, more investor-friendly terms, and a decreased investment rate, with about one-sixth of VCs reporting pressure from limited partners to conserve capital. Although aggregate returns are largely unchanged, there is high dispersion both within and across funds. A follow-up survey shows faster-than-expected recovery in deal volume, terms, and returns.