ICYMI: Harvard Business Review (HBR) kicked the gender-bias in venture capital hornet's nest in its recently published article "We Recorded VCs' Conversations And Analyzed How Differently They Talk About Female Entrepreneurs." Between 2009-2010, researchers were given access to125 government venture capital decision-making meetings in Sweden and observed a whole lot of gendered discourse.

Read the HBR article for the full "he said/she said" discussion. Here, let's focus on this: governments are venture capitalists and quite significant ones, too.

As the HBR article points out: between 2007-2013, government venture capitalists in the European Union allocated 3,621,000,000 Euros to finance innovation and growth in small and medium-size businesses. While the article focuses on the gendered-discourse the researchers silently observed in the 125 meetings, it slides this in, in the last paragraph:

"Because the purpose of government venture capital is to use tax money to stimulate grown and value creation for society as a whole, gender bias presents the risk that the money isn't being invested in businesses that have the highest potential. This isn't only damaging for women entrepreneurs; it's potentially damaging for society as a whole."

On this side of the Atlantic, the U.S. government is a very significant player in the venture capital industry. Since 1953, the U.S. Small Business Administration (SBA) has delivered millions in loans, loan guarantees and contracts to small businesses. On the access to capital side, SBA financing ranges from micro-loans to you guessed it, venture capital. The SBA's mechanism for investing in innovation is the Small Business Investment Company program (SBIC), one of the largest fund-of-funds in the United States. The SBIC can invest up to $4 billion annually. It issues debt to venture capitalists, private equity funds and other vehicles that invest in America's small, but scaling, businesses.

Iconic brands - Apple, Intel, FedEx, and Tesla - have all received SBIC funding.

The SBIC program leverages the full faith and credit of the U.S. government to increase the pool of investment capital available to small businesses. SBIC was created to bridge the gap between entrepreneurs' need for capital and traditional sources of financing. This is a multi-billion dollar investment program! According to the SBIC "over the past five years (2011-2016), the program has channeled more than $21 billion of capital to more than 6,400 U.S. small businesses spanning a variety of industries across the country."

And 2016 was a record year for the SBIC: it provided $6 billion in financing to 1200 small businesses. Funding to women owned high-growth businesses? No precise figure as SBIC reporting lumps together "Women, Minority, Veteran Owned" ventures in one underserved category. What is known is that in 2016, only 61 companies out of 1200 were in the "Women, Minority, Veteran Owned" category. You read that right: 61 companies out of 1200.

SBIC's 5-year track record for investing in small businesses that are women-, minority- or veteran- owned is 7% (a bit brighter than the 0.05% in 2016).

Remember, one of the stated core missions of the SBA is to "mitigate the risk of financing small businesses that may not qualify for traditional loans" and that the SBIC loan program itself was intended to open up lending opportunities for underserved entrepreneurs, "including startups, growing businesses, women, minorities, and veterans".

The flaw in the execution of the program's mission statement is the lack of diversity of the private investors and investment funds who are the "limited partners" in the SBIC and are responsible for investing / accessing these funds. Measuring the Representation of Women and Minorities in the SBIC Program - a 2016 report prepared by the Federal Research Division, Library of Congress (under an Interagency Agreement with the SBA's Office of Investment and Innovation) found that:

· Racially diverse SBICs make more investments in minority-led and women-led portfolio companies than non-racially diverse SBICs.

· Approximately 12% of the investments made by racially diverse SBICs were in companies led by minority CEOs. For SBICs without racially diverse investment teams, the number is 5%.

· Approximately 19% of the investments made by racially diverse SBICs are to companies that are at least partly owned by women or ethnic or racial minorities. For SBICs without racial diversity, the number is 13%.

· Gender-diverse SBICs make two to three times more investments in portfolio companies with a female CEO than male-only SBICs.

· In the SBA's debenture program, 10.3% of the investments made by gender-diverse SBICs were in female-led companies, while the corresponding figure for SBICs with no gender diversity is 3.35%.

· When it comes to investing in women-owned portfolio companies: 18.18% of gender-diverse SBICs invest in women-owned portfolio companies while only 13.73% of non-gender-diverse SBICs do so.

For women entrepreneurs seeking funding, getting more women to the investment table as venture capitalists, angels or limited partners in funds seems to be one obvious solution - and thankfully, organizations such as Parity Partners, 37 Angels, Pipeline Fellowship, SheEO, MogulChix (and many more), are taking action in this regard. BUT it needs to be women of all colors - as gender diversity on the investment team does not lead to racial diversity in investment decisions. To the question: "Are gender-diverse SBICs more likely to invest in diversely led or owned portfolio companies than non-gender-diverse SBICs?" the Measuring the Representation of Women and Minorities in the SBIC Program sadly answered - no.