{"id":21284,"date":"2021-10-15T16:21:45","date_gmt":"2021-10-15T16:21:45","guid":{"rendered":"https:\/\/swoopfunding.com\/us\/?post_type=blog&p=21284"},"modified":"2024-04-27T12:00:10","modified_gmt":"2024-04-27T12:00:10","slug":"how-female-founders-can-claim-their-fair-share-of-global-venture-capital-funding","status":"publish","type":"blog","link":"https:\/\/swoopfunding.com\/us\/equity-financing\/female-vc-funding\/","title":{"rendered":"How female founders can claim their fair share of global venture capital funding"},"content":{"rendered":"\n
Author: Kerry Dwyer, Equity Account Manager, Swoop<\/em> The gender investment gap may not be as well documented as the gender pay gap, but it\u2019s an issue we need to pay more attention to as VC remains strongly skewed towards male founders. Crunchbase data shows that only 2.3 percent of VC dollars raised were by female founders in 2020, and this is a decline from 2.8 percent in 2019, with similar figures for the UK VC world (<3 percent).<\/p>\n\n\n\n We need a more diverse investor base, or at least a more open-minded one. Women are significantly under-represented in investment teams, with just 13 percent of decision-makers in the UK\u2019s VC scene. <\/p>\n\n\n\n Experience shows that women are more likely to invest in women, and the more difficult it is for females to break into the VC world, the more likely existing investment committees are to unconsciously seek similar investments to what they\u2019ve supported before.<\/p>\n\n\n\n Change is not an overnight process, so an effort needs to be made now to ensure an increased female presence in the industry – from entry level roles to limited partners. Starting a business can be daunting. According to the Wealthiher network<\/a>, 72 percent of women in the UK feel that they are not understood by the finance industry and 57 percent want less jargon. Acronyms and terms like \u2018bootstrapping\u2019, ROI<\/a>, CAC, LTV, \u2018pre-money\u2019, \u2018post-money\u2019, \u2018preferred stock\u2019, run rate and ARR, are part of the new language with which many entrepreneurs have to become familiar. It has also been found that women\u2019s pitches are less likely to try to shoot for the moon, and more likely to state facts and be more conservative with their projections than their male counterparts, thus making their proposals less appealing on paper. In addition to the points above, other arguments for the lack of gender diversity in the VC world include, greater childcare responsibilities for women, less of a network in male-dominated industries; and essentially, less time outside of the day job to network and work on their business. What is more, women are less likely to come from STEM industries where investors, and more increasingly government bodies, are looking for opportunities to support. Sarah Turner, Founder and CEO at Angel Academe highlights that female founders tend to concentrate on certain sectors<\/a> such as beauty, health, social care and retail.<\/p>\n\n\n\n \u201cThere are lots of startups that aren\u2019t really scalable or operate in extremely crowded markets. We\u2019d like to see more opportunities that are clearly differentiated for large, but under-served markets.\u201d <\/p>\n\n\n\n Female founders have a role to play themselves; anecdotally, women tend to be more self-limiting than men. Perhaps the way forward is for women to have greater confidence in an idea and boldly going where sometimes few women have gone before. At Swoop, we have seen an increase in demand in areas such as infrastructure and forestry where the number of female entrepreneurs is lacking compared to men. Women in these and other areas, such as STEM, should see their under-representation as an opportunity to stand out by showing leadership rather than keeping quiet about their ideas. <\/p>\n\n\n\n
<\/p>\n\n\n\nWomen are under-represented in decision-making positions at venture capital (VC) firms, resulting in women claiming less funding than they deserve. Kerry Dwyer, Equity Account Manager at Swoop explains how this can (and must) change.<\/h6>\n\n\n\n
Entrepreneurship<\/a> is the bedrock of a thriving economy, and post-pandemic, supporting the country’s entrepreneurs is crucial to our recovery. These are the people creating jobs, driving innovative ideas and improving society; however, the figures show that we are missing a huge opportunity.<\/p>\n\n\n\n
An unbalanced industry<\/h4>\n\n\n\n
<\/p>\n\n\n\nWhat do female founders want?<\/strong><\/h4>\n\n\n\n
<\/p>\n\n\n\nWhy don\u2019t VCs invest in more women?<\/h4>\n\n\n\n