Structural frictions persist and compound in the subsequent rounds of fundings for women-led companies. Concentrated investor networks shape not only who receives first- round funding but also who advances through subsequent stages. If syndicates and boards are homogenously women-led, it is often harder to attract follow-on capital. Which instruments are offered: Product fit and stage Even when interest exists, the money on offer often does not fit the need: much capital is built for big, late-stage rounds. Everyone needs early growth funding (pre-Series A24), but when markets run on incumbent networks, men tend to capture larger seed/angel rounds and recognized leads, while women face narrower networks, undercapitalized first rounds and shorter runways. As a result, many women-led businesses need earlier growth finance, working capital or revenue-linked options. In short, the issue is not higher inherent risk; it is uneven access and products mismatched to stage.25 Often women entrepreneurs find first-stage funding in niche or marginal investment which leads to narrower networks, limited banker coverage and less guidance for their business growth – so it takes longer to grow and to sell or list. That scarcity becomes most punishing after Series A: without a recognized lead and dense syndicate, valuation signals do not elevate the value of their company, and follow-on funds hesitate. The effect is sharpest in capital-hungry fields such as AI and deep tech, where early bottlenecks become weaker A → B and subsequent round conversion.26 This phase matters because Series A → B → C is when firms raise true scale capital, hire senior talent and secure enterprise distribution. When those channels narrow, strong companies stall for lack of signal and support – not because fundamentals are weak – so good opportunities are missed, portfolios become more correlated and fragile and diffusion of new solutions slows. 3.3 Market concentration and missed global growth Allocator concentration – a few investors controlling most deployable capital – is now visible in market outcomes. In the first half of 2025, just 12 US venture firms raised more than 50% of the total value of capital and the top 30 firms raised 74% of all capital.27 This concentration of capital creates a thinner pipeline of new entrants, particularly in early- stage and capital-intensive innovation. Three reinforcing mechanisms illustrate how this dual concentration can destabilize growth: 1. Scaling of bias to misallocation: A small set of large, limited partners and fund managers dominate fundraising, deal flow and exit pathways. As capital pools consolidate, competition narrows not around differentiated insight but around access to the same proven managers and sectors. This concentration encourages capital recycling into familiar names and inflated valuations rather than discovery of new frontiers of productivity. 2. Concentration of signal power to systemic correlation risk: Investors benchmark to one another, use similar data sources and co-invest in overlapping syndicates. Shared narratives become reinforcing signals that drive correlated capital movements. What looks like diversification across funds and vintages conceals exposure to the same assumptions and sentiment cycles. When those narratives unwind, the alignment of decisions across managers amplifies the downturn, turning local valuation corrections into systemic correlation risk. 3. Path dependence to innovation drag: Early choices about product design, diligence standards and co-investment norms lock in who gets access and which teams can scale. When governance and sourcing pipelines skew towards incumbents, the diffusion of frontier solutions slows even when the underlying demand is clear. Taken together, these dynamics depress market quality: capital is steered away from high-potential opportunities; portfolios become more concentrated leading to systemic risk; and the diffusion of new solutions slows. These dynamics create a self-reinforcing inefficiency loop: bias scales, correlations rise and innovation narrows. What once passed for efficiency ultimately erodes systemic adaptability and the market’s capacity to discover, fund and scale the next generation of growth. Advancing gender parity could be a first and critical step towards breaking this cycle – one that helps build a more diverse, resilient and forward-looking investment network. Yet it should be seen not as an end in itself but as part of a broader effort to ensure that the financial system better reflects and serves the full spectrum of talent and opportunity driving long-term growth. Transforming Capital for the Next Era: Gender Parity and the Expansion of the Investable Frontier 14

Transforming Capital for the Next Era 2025