There’s a version of this conversation that goes: women undervalue themselves, so women should value themselves more.
That’s true and not very useful. It treats undervaluation as a private confidence problem. The more interesting finding is that the market undervalues women’s businesses too — and the evidence suggests the market is wrong.
Which changes what undervaluing yourself actually means. It isn’t modesty. It’s agreeing with a mispricing.
What the evidence shows
In 2018, Boston Consulting Group and the accelerator MassChallenge published an analysis of 350 startups that had been through MassChallenge’s programmes, tracked over five years.
Startups founded or co-founded by women raised an average of $935,000. Those founded by men raised $2.12 million — more than twice as much.
Over the same five years, the women-founded startups generated more cumulative revenue: $730,000 against $662,000.
Put per dollar invested, women-founded startups generated 78 cents of revenue for every dollar of funding. Male-founded startups generated 31 cents.
The researchers controlled for factors such as the founders’ education and the quality of their pitches, as rated by judges, and the gap held.
Worth being careful about what this is: one study, of accelerator alumni, measuring revenue rather than profit or eventual valuation. It isn’t proof that women are better founders. It is strong evidence that capital was being allocated in a way that didn’t track performance — and that’s the part that matters here.
Why the market gets it wrong
One of the clearest explanations comes from research by Dana Kanze and colleagues, who analysed recorded question-and-answer sessions between founders and venture capitalists. Their findings were published under the pointed title “We Ask Men to Win and Women Not to Lose.”
Investors tended to ask male founders about potential — growth, ambitions, how big it could get. They tended to ask female founders about risk — what could go wrong, how they’d protect what they had, whether they could hold on.
Founders answer the question they’re asked. So men ended up talking about upside and women ended up talking about defence — and the founders asked risk-focused questions went on to raise considerably less.
Nobody in the room intended that outcome. It came out of which questions felt natural to ask whom.
The same pattern appears far from venture capital. Clients push back on a woman’s quote more readily. Suppliers assume more flexibility. Buyers test whether the price is real. Each instance is small. Together they teach a lesson: your number will be questioned, so choose a lower one that’s easier to defend.
Where women agree with it
That’s the mechanism, and it’s worth seeing clearly.
If every price you name gets challenged, the rational short-term response is to name lower prices. If asking for more makes you seem demanding, and research shows it does, the rational short-term response is to ask for less. If a lean month might mean something worse, you pay yourself last.
Every one of those decisions makes sense on its own. Together they accept the market’s valuation as accurate — and the evidence above says it frequently isn’t.
So undervaluing yourself isn’t a character flaw. It’s a reasonable adaptation to an unreasonable environment. That’s worth knowing, because it means the fix isn’t feeling better about yourself. It’s refusing to accept a price you have good reason to think is wrong.
Where it shows up
Your prices. Set to avoid pushback rather than to reflect value. If nobody ever says you’re too expensive, you’re too cheap.
Your own pay. The most discretionary number in the business, and so the first to go. Many women founders draw little or nothing for years.
What you ask for. In funding, in partnerships, in referral arrangements. Less than the value warrants, because more feels presumptuous.
How you describe the business. Talking about protecting what you have rather than what it could become — which is exactly the framing Kanze’s research found costs founders money.
What to do about it
Use the evidence. When you notice yourself pricing low, remember that the market’s valuation of women’s businesses has been measurably wrong. Your instinct to discount may be calibrated to a biased signal.
Answer the question you should have been asked. If someone asks you a defensive question — what if it doesn’t work, how will you protect yourself — answer briefly, then talk about the upside. “That’s covered, and here’s where this could go.” Kanze’s later work found that reframing like this helped founders recover some of the gap.
Pay yourself a real, fixed salary. Treat it as a cost of the business, not what’s left over.
And compare notes. The fastest correction to an undervalued price is finding out what other women in comparable businesses actually charge. That’s precisely the private information a network of women provides.
The short version
You may well be undervaluing yourself. If so, you’re not wrong about how you’re treated — you’re just agreeing with it.
The evidence suggests the market has been getting this wrong. You don’t have to get it wrong along with it.
