With International women’s day’s #balanceforbetter message reaching far and wide these last few weeks, we were paying particular attention to the release of the Government's review of female Entrepreneurship, The Rose Review, highlighting the potential £250bn of value to the UK economy female entrepreneurship could bring in the coming years, while primarily outlining the barriers female start-ups face today.
Sadly, what was clear from the data was the fact that the gender parity gap between male and female entrepreneurs in the UK has actually worsened steadily since 2013. Over 1,100 new businesses are set up in the UK each day, yet only 1 in 3 UK entrepreneurs are female and just 8.6% of all UK women surveyed said they plan to start a business in the next three years, compared to 14.3% of men.
Why has the UK fallen behind? Just 6% of UK women run their own businesses, compared to 15% of women in Canada and 11% of women in the US.
The Rose Review shows that at every stage, female-led businesses receive less funding than those headed by men. Start-up funding is the #1 barrier mentioned by women entrepreneurs: women start businesses with a whopping 53% less capital on average than men, are less aware of funding options and less likely to take on debt.
For us though, maybe the most shocking numbers appear around women in teams. Only 1% of all venture funding goes to businesses founded by all-female teams. And only 13% of senior people on UK investment teams are woman, with almost half (48%) of investment teams having no women at all.
While the Rose Review brings awareness and ensures the conversation is taking place, as is often the case with public perception of themes around D&I, few dig deep. In general, we see a lot of data and commentary but little in tangible action. The report makes a lot of welcome recommendations; calling on UK Banks to increase funding opportunities and more transparency in funding allocation.
There are already networks in place for women entrepreneurs in the UK, driving positive change. Women Entrepreneurs UK is a web-portal offering insight, advice and all important, real world funding and grant guidance for aspiring female start- ups. The tech industry often proclaims that the gender balance issue is very well addressed, the celebration of established female industry role models offering a wealth of guidance and a host of initiatives such as the excellent, Women in Tech. But the reality seems somewhat different.
The question we find ourselves asking is simple; what else needs to be done to start pushing female entrepreneurship?
Women make up nearly 51% of the population, so there is clearly a huge problem. Is it that barriers are greater for women because of direct prejudice, or do women perceive themselves to be less able, less empowered and therefore less willing to go for it because of historical and deep-seated inequality? There is also a huge gender imbalance amongst those who make these funding choices – until financial services businesses, private equity houses, venture capital firms and banks start to address the gender imbalances in their own organisations, and there are more female angel investors, is it simply impossible to create a more level playing field?
We all have an obligation to highlight these barriers and call out this blatant sexism wherever and whenever we find it – question antiquated assumptions and push for change. Easy said than done of course. And women should be encouraged, through well-funded education opportunities, business initiatives and entrepreneurial programs, to be entrepreneurs.
We would love to hear your thoughts….
Joe Wells (Partner)
for Inventum Consulting.
Delivering inclusive solutions for an increasingly diverse world. Simply put, organisations that foster a culture of true inclusion are far more innovative and adaptable, and they outperform their non-inclusive competitors. They are also smart, ethical and great places to work.