Taskforce delivers ideas to improve the well-being of UK-based women-led ventures
Written by Rich Saunders
The Women-Led High-Growth Enterprise Taskforce recently posted a report that highlights the challenges faced by the UK’s high-growth entrepreneurship ecosystem, including the lack of opportunities for women entrepreneurs to show their potential in driving innovation and economic growth.
Anne Boden, founder of Starling Bank, led the report's creation to advocate for the re-evaluation of current investment strategies that involve an insufficient number of women entrepreneurs and funding for their ventures on the UK entrepreneurship scene.
"For example, in 2022, of the UK’s multi-billion pound venture capital funding, female entrepreneurs routinely received less than a 2% share of the investments made each year," said Boden.
The Taskforce recommends investment companies publish the percentage of senior investment professionals they employ on the basis that female investment professionals will be more likely to support female-founded and -led business ventures.
The Taskforce also suggested investment companies sign up for the Investing in Women Code, a voluntary commitment from financial services organisations to support the development of female entrepreneurship in the UK by improving access to finance, resources, and tools.
As little as 204 signatories participated in the Code in late March 2023, and the Taskforce expects more signatories to participate in the commitment.
Common problems for female entrepreneurs
Despite the increasing awareness of involving more female entrepreneurs to address the global gender gap, the Global Gender Gap Report 2022 shows that our modern society still needs 132 years to close the gap at the current rate of change.
The most common gender gap issues in the entrepreneurship scene are occupational segregation, discrimination in salary amounts and pay systems, and the lack of flexible working hours and work settings.
When it comes to the reality of the UK female entrepreneurship scene, research by Bibby Financial Services (BFS) reveals that 43% of UK female entrepreneurs face difficulties receiving the much-needed cash flow to grow their businesses. In comparison, only around 29% of male business owners showcase the same situation on their end.
"The ugly truth is that, even in 2023, it’s still much harder for female entrepreneurs to access funding than it is for their male peers. In fact, women business owners receive less than half of the investment capital of their male counterparts, despite delivering twice as much revenue per dollar invested," said BFS Chief Strategic Development Officer Lucile Flamand.
Further exacerbating the issue is the difficulty in securing a business loan for many female business owners in recent years compared to pre-pandemic years. According to other BFS research, around 62% of female business owners struggle more than their male counterparts in this context, with only 57% of male business owners having problems securing loans in recent years.
Elevating high-growth female UK business owners
Considering the significant challenges female entrepreneurs face in the UK, the Taskforce offers several suggestions to improve their well-being apart from improving their access to funding and collecting signatories.
Among the suggestions is for the Financial Conduct Authority (FCA) to introduce the involvement of diversity-focused consultation services. In this regard, the Taskforce recommends investors create a more inclusive and equitable environment via FCA-approved policies that may involve female entrepreneurs to greater heights.
The Taskforce also recognises the need to expand business opportunities into UK regions beyond London that are often neglected in favour of London's status as a global economic hub. To do so, the Taskforce has laid out a replicable blueprint to scale up local ecosystems for female entrepreneurs with high-growth potential.
Another suggestion is encouraging young girls to become entrepreneurs. This suggestion may involve the dissemination of entrepreneurship-related publications for young girls in schools and presenting the success stories of female high-growth entrepreneurs.
Lastly, the Taskforce suggests further improvements in the data collection of directors, people of significant control, and investment scheme users to increase the involvement of female entrepreneurs. To make sure that female entrepreneurs receive their funding, the Taskforce also demands that stakeholders address the issue of the increasing complexity of female entrepreneurs receiving equity funding at later stages of growth.
About the Author
Meet Rich, a multifaceted professional at Tech Ed.
An alumnus of our coding bootcamp, Rich's journey in the tech world has been rapid and remarkable. In just six years, they have progressed from learning to code to pivotal roles in admissions, teaching, and now in marketing and operations. Rich is a fully qualified digital marketer with the DMI and possesses a unique talent for demystifying complex tech concepts, making them accessible and engaging to our audience.
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