Female Founders and the Funding Gap

Young woman whispers in friend's ear

What's it like to be a woman entrepreneur? Research house Beauhurst reports on a funding gap for startups led by female founders. Is that bad luck, prejudice, or just being different?

Beauhurst's Eleanor Sharman presents the research in a report and a presentation you can view online. Read the original. This quotation explains the motive and the method.

"We analyse these investments by splitting them into two types: those that went into companies with a female founder, and those that went to companies without one. We also look at only two funder types: traditional private equity or venture capital firms, and equity crowdfunding platforms."

In July, we reported evidence from PwC and the Crowdfunding Centre that women are successful at raising money via crowdfunding: “Women Unbound: Crowdfunding – Unleashing Female Entrepreneurial Potential.”  Although they ask for smaller sums than men, they are more likely to hit the targets they set themselves. And as far back as 2010, Beauhurst were reporting that female entrepreneurs are less likely to fail.

Perhaps the most compelling evidence is that women as a group make different choices than men, and they tend to succeed at the choices they make. For risk-averse investors, these facts are significant, and could be good news.