The conversation about Australia’s gender investment gap has long centred on one question: who gets funded? A growing coalition of investors, researchers and policymakers now believes the more important challenge is understanding what happens before that funding decision is ever made.

Do women founders enter investor pipelines at lower rates? Are they less likely to secure a first meeting, progress through due diligence or reach an investment committee? Or are opportunities being lost much earlier through networks, sourcing and access? Despite years of debate about gender equity in startup funding, stakeholders have had little visibility into the investment pipeline itself, making it difficult to understand where opportunities begin to diverge – and why.

That’s the blind spot that not-for-profit Equity Clear and knowledge partner, UNSW Centre for Social Impact, are seeking to address through a national initiative to develop Australia’s first common standard for investor diversity reporting, creating a shared approach to understanding how opportunities move through the pipeline.

The proposed Equity Clear Standard has been shaped through six months of consultation involving more than 160 organisations from across Australia’s startup ecosystem, bringing together investors, founders, policymakers and industry representatives to co-design a framework for sector-wide adoption. The UNSW Centre for Social Impact is contributing research expertise and oversight of data ethics and governance as the initiative moves towards implementation.

"By combining research with the experience of stakeholders from across the investment ecosystem, we are building a trusted data standard that provides the clarity and insights needed to better understand how opportunities move through the funding pipeline," said Professor Danielle Logue, Director of the UNSW Centre for Social Impact. “A clearer view can help identify today's investment blind spots and create new opportunities to improve how capital is allocated."

The initiative reflects a growing recognition that, despite years of attention, the conversation around gender equity in startup funding has largely focused on outcomes rather than on the system that produces them. As a result, stakeholders have had little evidence to explain why those outcomes persist.

“We don’t have a strong evidence base, beyond final funding outcomes and a lot of anecdotes,” Equity Clear lead Noga Edelstein said at the organisation’s recent national industry forum event, which introduced the standard alongside a national report, Show Us the Data: From Anecdote to Evidence. “We don’t just have a funding gap. We have a data gap.”

From frustration to action

The idea for Equity Clear emerged from a growing frustration that, despite years of discussion, little had fundamentally changed. While venture investment in Australia has continued to grow, the distribution of that capital has remained stubbornly uneven. In 2025, all-female founding teams received just 2% of about $5.1 billion in venture capital invested in Australian startups, while all-male teams attracted 76% of that pool. Mixed-gender founding teams received 22% of investment.

“The reality is – despite significant growth in venture funding – the distribution of that capital hasn’t shifted,” said Edelsten, who found herself reflecting on the persistent gap between the industry’s intentions and its outcomes after contributing an article to Cut Through Venture’s 2024 State of Australian Startup Funding report. 

“I made a commitment to myself that when the next report came out, and the numbers hadn’t shifted, I wouldn’t still be just talking about it,” said Ms Edelsten, who also serves as an Adjunct Fellow at the Centre for Social Impact. “It was time for action.”

Rather than focusing on programs designed to help women founders navigate the system, Ms Edelstein began asking a different question: what if the problem wasn’t simply the founders, but the system itself?

The Equity Clear Standard – a national framework designed to create consistent, comparable data across the investment pipeline – aims to establish a common way to track how opportunities move through the funding process, allowing participating organisations to identify where founders progress, where they fall away, and where patterns begin to emerge.

“The problem here isn’t a lack of intent; it’s a lack of shared infrastructure,” Ms Edelstein said, noting that the strong stakeholder engagement the initiative has attracted “doesn’t happen unless there is a real appetite to do something differently. Until we can actually see how capital flows through the system, we can’t explain the outcomes we’re seeing today. And if we can’t explain them, we can’t change them. That’s the shift: from anecdote to evidence.”

Why better data matters

Better information leads to better decisions – but only when it can be compared, interpreted and acted upon. That’s the gap Equity Clear believes has been missing from Australia’s startup investment ecosystem.

Without comparable pipeline data, it is difficult to determine whether disparities stem from sourcing, evaluation processes, investment readiness, access to later-stage capital or other structural factors. In effect, the ecosystem has spent years trying to solve an outcome without being able to properly diagnose the system producing it.

"Looking only at funding outcomes tells us what happened; understanding the pipeline helps explain why. Seeing how the journey works in practice moves us from anecdote to evidence, creating a stronger foundation for improving the system," said Prof. Logue.

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“We need to be able to see where diverse founders start to experience different outcomes across that process, because without that visibility, we can’t tell the difference between a pipeline issue, a process issue or a decision-making issue,” Ms Edelstein said. “We end up trying to solve for outcomes without really understanding what’s driving them.”

Most organisations (88% of respondents to Equity Clear’s consultation) are already collecting some form of diversity data, and 92% of venture capital firms track gender data. But those organisations are collecting different information, at different stages of the investment process, using different definitions and systems – from spreadsheets and CRM platforms to bespoke surveys and manual reporting.

“The problem isn’t collection; it’s fragmentation,” Ms Edelstein said. “Different tools, different definitions, different points of capture. Which means we end up with a lot of data but no shared view of what’s actually happening. Without that, you can’t compare, you can’t benchmark, and you can’t learn at a system level.”

Rather than building an entirely new reporting system, the proposed standard is designed to align and standardise information investors are already collecting. The challenge, Ms Edelstein argues, is largely practical rather than philosophical.

Consultation during industry roundtables held in five states identified three principles that would be critical to widespread adoption: the framework must fit within existing investment processes rather than create additional work; it must be governed in a way that builds trust; and the information collected must generate insights that organisations can actually use, not simply report.

“What this points to is not a single tool or intervention but a piece of shared infrastructure, because the problem we’re trying to solve isn’t isolated; it sits across the system,” Ms Edelstein said. “This is how we move from intent to implementation.”

Learning from overseas

Australia isn’t starting from scratch. Similar efforts overseas have demonstrated how consistent reporting standards can improve visibility into investment pipelines and, over time, influence investor behaviour.

The UK’s Investing in Women Code, launched in 2019, has become Equity Clear’s closest point of reference. The voluntary commitment asks investors to track and report on the gender composition of their investment pipelines, with signatories now representing more than US$1 trillion in funds under management. Ms Edelstein explained: “What’s even more interesting than the scale is how quickly participation normalised. At a certain point, it stopped being, ‘Should we do this?’ – and not participating started to become a negative signal. That’s when behaviour starts to shift.”

The results have been encouraging. According to the latest UK report, signatories consistently invest in a higher proportion of women-led businesses than the wider market, suggesting that greater visibility can help organisations identify gaps and make more informed decisions over time. 

Lessons from international experience also shaped Equity Clear's approach to the Australian model. One is the importance of starting simple. “If you try to measure everything from day one, nothing gets adopted,” Ms Edelstein said.

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Another key lesson: “Consistency matters more than sophistication. You need everyone measuring the same thing.”

Other insights were equally practical: reporting needs to fit within existing workflows rather than create additional administrative burden, manual processes are unlikely to scale, and the value of the system increases as more organisations participate.

Those international lessons have informed, rather than dictated, Equity Clear’s approach, which has leaned on local stakeholders during the past six months to build a framework tailored to Australia’s investment landscape. “Rather than waiting for this to be imposed on Australia from the outside, we’ve chosen to co-design it with the ecosystem,” Ms Edelstein said. “This has been shaped by the people who would actually need to implement it.”

Building a common language for investment

The result is the Equity Clear Standard, a framework built around three interconnected components. The first is an Australian Investing in Women Code, aligned with the UK model: a voluntary commitment by participating investors to collect and report agreed diversity metrics across their investment pipelines.

The second is a common data method, which standardises what information is collected, when it is captured and how it is defined, creating what Ms Edelstein describes as “a shared language for the pipeline”. She explained: “At its simplest, the common data method means different investors measuring the same things, in the same way, at the same points in the pipeline.”

"This is about aligning early-stage pipeline tracking, because a lot of the signal is shaped well before a deal reaches a fund"

NOGA EDELSTEIN

Deliberately, the framework starts small. “One of our biggest design choices here was restraint. The fastest way to kill adoption is to overcomplicate this,” Ms Edelstein said. Rather than attempting to cover every aspect of diversity, participating organisations initially collect a limited set of company-level information – including founder gender, pipeline stage and location – alongside basic investor-level context such as team composition and fund size.

Future iterations may incorporate richer founder data, enabling more nuanced and intersectional analysis over time, but only once the core reporting framework has been embedded across the sector.  “This isn’t about capturing everything on day one; it’s about capturing enough to generate meaningful insights,” Ms Edelstein said.

Making evidence work

The next step is transforming the framework into practice.

A pilot program will test the Equity Clear Standard across participating organisations, with refinement and validation taking place over the next year before a broader rollout is planned for the 2028 financial year. Participants will receive confidential benchmarking and market-level insights designed to help them better understand their own investment pipelines while contributing to Australia’s first national picture of how opportunities move through the funding system.

“This is about aligning early-stage pipeline tracking, because a lot of the signal is shaped well before a deal reaches a fund. And then those things start to line up – participation, expectation and alignment – that’s when this shifts from something optional to something that’s just part of how the ecosystem operates,” Ms Edelstein said.

Ultimately, the initiative seeks to create the conditions for better-informed investment decisions through stronger, more consistent evidence. By making the investment pipeline more visible, Equity Clear hopes investors, policymakers and the broader ecosystem will finally have the evidence needed to understand not just who receives funding, but how those outcomes are produced.

"Markets work best when decisions are informed by robust evidence. A trusted data standard helps create the foundation for more transparent and effective capital allocation, supporting a more inclusive and innovative startup ecosystem," said Prof. Logue.

The gender investment gap is “bigger than any one deal or any one fund; it’s a persistent system-level outcome”, Ms Edelstein said. “The question we’re focused on is: what are we missing that would allow us to shift this? If we want to change that outcome, we need to understand how capital allocation decisions are actually made.”

Seven recommendations for industry professionals

1. Venture capital firms: Map each stage of the investment pipeline and confirm that the same founder and company data can be followed from sourcing through to the investment committee.

2. Investment partners: Review whether referral networks, meeting criteria and due diligence processes produce different progression rates across founding teams.

3. Limited partners: Ask fund managers what pipeline diversity data they collect, how they define each measure and whether they compare results across funds or periods.

4. Startup accelerators: Align application and referral records with investor pipeline definitions so that opportunities can be tracked before they enter a venture capital fund.

5. Policymakers: Use common definitions across grants, accelerators and investment programs to support comparison without increasing reporting requirements.

6. Founders: Ask investors how opportunities enter their pipeline, which criteria determine progression and when investment decisions are made.

7. Investment operations teams: Audit existing CRM fields and reporting processes before introducing new data collection, with attention to consent, governance and access controls.