Investment bank Goldman Sachs (GS) is betting big on women-led companies through its program Launch With GS. The program has already invested nearly $100 million dollars in its first year.
“Launch With GS is Goldman Sachs’ $500 million dollar commitment to invest in companies and investment managers with diverse leadership, at its core it’s an investment strategy,” Jemma Wolfe, head of Launch With GS, told Yahoo Finance’s On The Move. The program invests Goldman’s capital and also partners with clients to raise capital to invest in investment managers.
The three main components of the program include investing in women-led companies, backing women-centered investment managers by investing in client capital across venture capital, growth equity and private equity strategies and building a community of entrepreneurs, investors and other business leaders.
“We’re ultimately looking to drive returns here,” Wolfe said. “When we think about making investments a lot of it comes down to the team, who is the team driving the business, who is the team making investment decisions, and we think diversity is such a key aspect of that.”
According to Goldman Sachs, diverse teams outperform. Goldman, in conjunction with Pitchbook, All Raise and Microsoft for Startups, recently released a report called “All in Women in the VC Ecosystem,” which revealed that startups founded and co-founded by women generate 10% more in cumulative revenue growth in a five-year period. The report also found that funds with diverse leadership achieve higher internal rate of return.
“Businesses with women actually exit faster than all-male teams,” Wolfe said. ‘From an investor perspective you’ll actually see a return on your capital quicker.”
Brooke DiPalma is a producer for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma.