International Women’s Day on March 8th brings renewed attention to the fact that women-led businesses receive significantly less funding than male-led counterparts.
Nearly half (47 per cent) of early-stage entrepreneurs in the UK are women.
Their ventures are transforming industries, creating jobs and reshaping what leadership looks like.
But behind those success stories, there remains an endemic disparity between male and female founders.
As things stand, women entrepreneurs receive only a fraction of the support and funding available to their male counterparts.
In 2024, all-female founder teams secured only 2 per cent of equity investment in the UK, with 80 per cent going to all-male teams.
Despite these stark statistics, there’s plenty to be optimistic about as the industry continues to move the dial towards positive change.
For instance, there are more initiatives and programmes aimed at empowering female entrepreneurs than ever before.
Addressing the gender gap in entrepreneurship goes far beyond merely promoting equality – it’s essential for driving greater innovation and growth for the whole economy.
If women started and scaled businesses at the same rate as men, it would deliver a potential £250bn boost to the UK economy.
Mind the gap
As growth capital investors committed to driving positive change in our industry, there are several initiatives we’re taking part in to celebrate female-powered businesses.
BGF is the most active growth capital investor in the UK for backing female entrepreneurs, according to data from the ScaleUp Institute.
We have committed £300m to female-powered businesses across the UK over the next five years – one of the largest investments of its kind.
Alongside Coutts, NatWest’s Private Banking arm, we also launched the UK Enterprise Fund (UKEF) in 2021 to identify and address equity gaps across the whole of the entrepreneurial ecosystem, with specific initiatives for female-powered businesses.
Beyond industry commitments, there are also government-backed initiatives providing funding for women in business. Key initiatives include the £75,000 Women in Innovation Award, and the Female Founders Fund for startups.
These programmes, along with organisations like The King’s Trust, help women overcome financing barriers.
Investing in Women Code
BGF is a signatory of the Investing in Women Code, a UK government-backed initiative set up to address barriers preventing female entrepreneurs from accessing capital in the same number as men.
The code strives to promote female entrepreneurship, increase transparency in funding activities, and adopt practices to better support female-powered businesses.
Together, the Investing in Women Code signatories commit to breaking down barriers within the industry, alongside the Department for Business and Trade (DBT) and the Investing in Women Code Partners.
In 2024, DBT’s annual Investing in Women Code report found that venture capital fund signatories outperform the equity market year-on-year in supporting female founders – demonstrating that intention and commitment to closing the gender gap can lead to demonstrable change.
Internally, we have a close to 50:50 gender split across our team. And we continue working to ensure this gender balance filters into all areas of the business, including our investment teams – because female investors are two times more likely to back female founders.
We also recognise the crucial role of senior women on boards, in inspiring and mentoring female talent, and encouraging female entrepreneurship.
This is embedded in our efforts to increase the number of female non-execs on the boards of our portfolio companies.
Meanwhile, on our own board, three out of four of our non-executive directors are women.
How do female founders get investment?
Securing investment for the next stage of a business’ growth takes preparation and access to networks.
Few are investor-ready from the outset. There are consistent things to consider when preparing for investment.
At our recent Women in Entrepreneurship & on Boards (WEB) Forum, attendees highlighted common challenges like finding a community of like-minded female entrepreneurs, business leaders, and non-execs for mentorship and support.
But we’re now helping to build this community, with regular forums on a range of topics alongside social events from wreath making to yoga.
There are always some foundations to get in place ahead of considering an investment process:
- Growth plans: Your business’ growth strategy should be underpinned by a detailed step-by-step plan, reinforced by as much evidence as possible;
- People: Investments rely on relationships, and relationships rely on people. A strong growth plan should outline the leadership, technical and professional skills within the business, giving investors confidence in the management team they’re backing;
- Credible financial plan: Due diligence is critical. Financial accounts and supporting analysis must be compliant, well-formatted and detailed;
- The right investor: While female-focused investment funds are still limited, if you can demonstrate your potential, you can leverage the existing investor ecosystem – regardless of gender, they’re always on the lookout for high-potential businesses. Some specialise in sectors, some are generalists; some seek short-term returns, others long-term – so engage investors aligned with your goals;
- Timing – Some businesses reach investor-readiness in a few months, but three to six months is typical, with 12 months or more needed if significant work remains.
What more is needed?
There is still work to be done to create more inclusive entrepreneurship, and a more equitable future for female-powered businesses.
Capital alone isn’t enough to drive growth. Networks, community and visibility for female entrepreneurs are crucial.
Collectively, we need to do more to increase female representation on boards and nurture successful mentor-mentee relationships.
The time to power diversity in the growth economy is now.