Female-founded startups are less common than women-led small businesses or traditional companies. And while women are gaining ground when it comes to launching and running successful startups, it’s not as much as you might think. In 2020, 28% of startups had at least one female founder, only a 6% increase from 2017.
Women-led startups are also less likely to be acquired or go public than those led by men. This may be due to women’s challenges in accessing funding and building networks in the venture capital industry. Female founders received only 2.3% of total venture capital funding globally in 2020, even though women-led startups are statistically proven to be just as successful as those led by men.
Female entrepreneurs face different challenges than men
Access to funding: One of the biggest challenges for female startup founders is access to funding. Research has shown that female founders receive less funding than male founders, despite having similar qualifications and experience. Less than 2% of venture capital funding went to all-female founding teams in 2021, marking a five-year low, new data from PitchBook shows.
Gender bias: Female founders may also face gender bias from investors, customers, and employees. Discrimination can manifest subtly, such as assumptions that women are less competent or less committed to their businesses than men.
Lack of role models and networks: Female startup founders may also need more role models and mentors who can provide guidance and support. Without mentors, role models, and networks, women find it harder to navigate the challenges of entrepreneurship and build successful businesses.
Work-life balance: Women are more likely to be responsible for caregiving, making balancing the business’s demands with family responsibilities more challenging.
How can you help female founders?
Everyone must help address inequities for female founders because it is the right thing to do and makes good business sense. Men, in particular, can help women achieve more parity in the workplace simply because they are more of them in senior roles.
Here’s how you can help women in the workplace.
Advocate for women: Decisionmakers can use their position and influence to advocate for women in their workplaces. This can involve speaking up when they see gender bias, recommending qualified women for promotions and leadership positions, and supporting initiatives that promote gender equality.
Get educated: Men, especially, can educate themselves about the challenges women face in the workplace, including the gender pay gap, unconscious bias, and workplace harassment. This can help them become more aware of the issues and better allies for women.
Mentor women: Experienced thought leaders can mentor women in their workplaces, providing guidance, support, and advice to help them advance their careers. This can involve sharing their experiences, offering constructive feedback, and assisting women in building professional networks.
Create inclusive workplaces: Everyone can help to create more inclusive workplaces by challenging gender stereotypes, promoting diversity and inclusion, and advocating for policies that support work-life balance and parental leave.
Be aware of bias: We all need to become more mindful as we work to overcome bias. This can involve challenging their assumptions, seeking out diverse perspectives, and being open to feedback from women.
In closing
Women-led startups are likelier to have more female employees than male-led startups. This suggests that female founders may be more intentional about creating inclusive workplaces.
Men can play a crucial role in promoting gender equality in the workplace, too.
Men can learn to become better allies. While the process may be a bit uncomfortable at first, a deeper understanding requires a commitment to learning about the professional challenges of women and advocating for gender equity. The solution is more interaction and learning, not less.
With more men helping women achieve more parity, we can help create inclusive workplaces for everyone by being advocates, mentors, and allies to female founders.
The featured image is of several female founders at Geekdom, photo courtesy of Geekdom.
