Wells Fargo has awarded women executives organization, How Women Lead, a $1.5 million grant to accelerate the growth of women-owned small businesses.
The bank has set aside the grant to “disrupt the unequal venture capital system for women founders”.
The funds will be used to target up to 10,000 women and help them invest with venture capital for the first time, with a view to building a $1 billion fund.
“Supporting women and women in business has always been a huge priority at Wells Fargo and this month we are underscoring our year-round commitment,” said CEO of Wells Fargo consumer and small business banking, Mary Mack.
“If we come together on actionable steps to close the gender inequity gap, we can accelerate the trajectory of women entrepreneurs and their contributions to the economy,” she added.
According to data from the Center for Venture Research cited by Wells Fargo, only 5% of women investors have access to venture capital funds, despite them controlling 50% of wealth today.
In addition, only 1.8% of venture capital investments are distributed to women-led start-up businesses.
“We are at a unique moment in time, an inflection point, where we have a generation of women who have risen in the ranks as corporate leaders and have wealth to invest,” said Julie Castro Abrams, founder and CEO of How Women Lead.
“Investing in women-founded companies is financially savvy, creates six times more jobs for women, and results in economic growth for us all. Collectively we have the wealth to fund women founders and the expertise and influence to support those companies to success.”
Wells Fargo has been scaling social investment recently. Last month, Wells Fargo and Chase Bank joined crisis relief organization RED, to aid efforts to scale access to relief in the world’s poorest countries.
Last year it teamed up with the Thurgood Marshall College Fund to launch a $1 million project to help close the graduation gap for college students at historically black colleges and universities.