Invest in Women Taskforce co-chairs, serial entrepreneurs Debbie Waskow and Hannah Bernard; … [+]
The perception of female entrepreneurs and their place in business is evolving. In recent years, the female entrepreneurial community has grown, with women now making up a third of entrepreneurs managing existing businesses. In 2022, more than 140,000 female-founded businesses will be established, a figure that represents annual growth of more than a third. In 2023, it is reported that more than 20% of new businesses will be led by women, breaking previous records. In 2022, just under 17% of active UK businesses are led by women, yet the proportion of fast-growing businesses is just over half at 8.7%.
Women still face challenges in accessing finance for their fast-growing businesses and the disparities are stark: female-led businesses receive just 34% of the loan approvals offered to male-led businesses, meaning in real terms that the average loan size for female-led businesses is £174,000 compared to £507,000 for male-led businesses.
To address the barriers faced by female entrepreneurs, a new task force, Invest in Women, has been formed with the goal of increasing the number of fast-growing female businesses. Led by industry and supported by the Government through the Department of Business and Trade (DBT), it is co-chaired by Debbie Waskow and Hannah Barnard, head of business banking at Barclays Bank.
Debbie Woskow OBE, a serial entrepreneur known for ventures such as Love Home Swap and AllBright, highlights the importance of improving access to funding for ambitious women entrepreneurs. She shares her hopes for the Task Force, which aims to eliminate gender-based funding challenges and make the UK the most favorable environment for female founders. Woskow thinks and acts with lightning speed, which I witnessed when I first interviewed her and co-founder Anna Jones as AllBright pivoted to online learning during the pandemic. She brings this same energy to creating better access to funding for ambitious women entrepreneurs. She shares her hopes for the Task Force: “Women-owned businesses should not face challenges in raising funding to start and grow their businesses because of their gender. As an experienced entrepreneur who launched her first business 25 years ago, I know firsthand the importance of breaking down barriers and creating meaningful change for women-led businesses. By making funding a top priority with this Task Force, we aim to make the UK the best place in the world for female founders.”
The funding environment for fast-growth female entrepreneurs is complex and funding structures are heavily biased towards men. According to the Boden study of fast-growth female-led businesses, equity funding has been minimal over the past decade, with just 2p of every pound invested going to businesses founded solely by women. In 2023, just 9% of venture capital funding will go to female entrepreneurs. Despite the untapped potential of fast-growth female businesses, barriers remain, including a lack of women in influential positions in equity and venture capital funding.
The private equity and venture capital funding sector has been one of the slowest areas of finance to change. Only 11% of roles are held by women, and only 13% of companies require women on their investment teams (BCVA). The Alison Rose Review on Female Entrepreneurship estimates that unlocking the potential of fast-growing female businesses could contribute £250 billion to the UK economy. These companies go beyond traditional stereotypes and are not limited to home-based or part-time ventures. Waskow believes they are addressing a huge untapped market need. “Women-led companies solve problems that women face. For example, I am the chair of Better Menopause, a women's health, science and nutrition company, and I pitch it to a room full of men. It's not impossible, but men don't have the same connection to the problem the company is trying to solve. I see this time and time again.”
Recognising the need to change the face of investment, Wosskow emphasises the importance of getting more female angel investors to change the investment landscape. Wosskow acknowledges the importance of changing the face of investment: “It's really hard for female founders to find a way to tell their story to investors when it's always a man on the other side of the table. That's how you change the power dynamic. The answer? Get more female angel investors! With the support of the British Business Bank, we're exploring how we can increase the value of women supporting other women through match funding.”
Hannah Bernard OBE shared her vision for the Taskforce: “This is an area I am incredibly passionate about so I am honoured to take on this role. I believe that the key to the UK's growth is enabling every entrepreneur in this country to succeed. Women entrepreneurs face extremely high barriers to getting the support and investment they need for their businesses, from seed funding for start-ups to the challenges of securing scale-up investment.”
As part of the Task Force's broader work, an Ecosystem Working Group has been established to strengthen the overall environment for women-led enterprises, with the goal of increasing the number of women starting and growing their businesses.
