October Editor’s Choice

October 2021 Editor’s Choice: “And the children shall lead: Gender diversity and performance in venture capital”

What promotes greater gender diversity in hiring? Does diversity lead to better firm performance and higher investment returns? This paper find strong evidence that when venture capital partners have more daughters, the propensity to hire female partners increases. Increased gender diversity improves deal and fund performance, and the effects are primarily driven by the gender of senior partners’ children.