The zero gender gap is a destination where progress arrives at different speeds. Parliament now has 191 (29 per cent) female MPs compared to 58 (nine per cent) a generation ago. By contrast, Law Society numbers show that 61 per cent of young lawyers are female (although the numbers tail off dramatically as seniority increases), as are 52 per cent of doctors registered by the General Medical Council.
It is then all the more surprising that the start-up scene actually has a gender gap. A TechCrunch study found that between 2009 and 2014, the number of funded start-ups with at least one female founder increased from only nine per cent to 18 per cent. Whilst another more recent TechCrunch report reports that only seven per cent of partners at top 100 venture capital firms and less than 12 per cent of partner roles at accelerators and corporate venture firms are female.
Why are women so under-represented within the start-up scene, and particularly as founders? Logically, if venture capital firms had more female investing partners then perhaps they would be more likely to invest in female-led start-ups. Allbright, a newly established crowdfunding platform and angel and support network, aims make the UK the best location for female founders. Allbright supports and invests in exclusively female-led businesses. Piccolo, the organic baby food business founded by Cat Gazzoli and first business to work with Allbright, successfully raised its £50,000 target within a mere two hours.
Increasing female numbers on the investor side is just one solution, but it still does not address the causes, such as why the gender divide among STEM subject students begins at secondary education.
Only 39 per cent of those sitting ‘A’ level Maths are girls; for Physics just 21 per cent; and for Computer Science, an insufficient nine per cent. These figures have not altered for a generation.
This gender divide continues at university education – despite females making up 57 per cent of university students, fewer than one in six engineering, technology, mathematics or computer science undergraduates are female. This impact on employment is self-evident. In STEM careers, just 13 per cent of employees are female, according to WISE, a community-orientated group established with the specific mandate of increasing female representation.
Women are equally scarce in senior roles in the finance and business industries, comprising just 9.6 per cent of FTSE100 directors.
Despite the increasing popularity of MBAs, only 35 per cent of MBA students at the world’s top 100 business schools are female, according to FT rankings. HM Treasury has signed the Women in Finance Charter, a commitment to support, amongst other goals, the progression of women into senior financial services roles.
All entrepreneurs encounter bias and stereotypes from would-be investors who either do not understand or cannot comprehend the problem they aim to solve. The most common challenges – such as finding a co-founder, a lack of resources (skills, money and time), to the challenge of closing a round whilst trying to meet your businesses’ KPIs and the need for more support – are universal challenges.
However, it is arguable that gender imbalances have translated into a lack of ‘easy access to know-how’ for many female founders. Having the ability to draw on a valuable contact network for advice, introductions and referrals is a huge asset that makes the everyday challenges (such as seeking investment, building a technical team, seeking a new mentor) for founders that much easier.
Ostensibly not a female trait but more often observed amongst female founders is the tendency to underestimate ability, as reflected by the language chosen when talking about their business. Founders need to be confident. No matter how great the concept, the impact of how a founder comes across cannot be overstated – it is vital not to undersell the business idea. When success correlates with confidence as much as competence, a lack of confidence cannot be disregarded.
Post-Brexit, it is obvious that diversity will matter more than ever, with several studies showing that companies are more likely to perform better when they have a gender diverse team. This is equally true where founding teams include women. Putting the focus on supporting female founders simply makes good economic sense.
Furthermore, gender equality is not a female-only issue. Advocacy groups led by men, such as London Business School Manbassadors and Men as Allies, proactively support gender equality, promoting diversity through education.
Diversity is crucial for innovation. Innovation is arguably the cornerstone of every successful start-up. In a survey by Forbes Insights, 85 per cent of respondents agreed that “a diverse and inclusive workforce is crucial to encouraging different perspectives and ideas that drive innovation”. The same conclusion applies for the UK start-up sector: more female role models are needed to inspire the next generation. To get more females involved, we must be more innovative – not just in our thinking, but in our actions too.
About the author
Stephanie Ng is a senior corporate and commercial lawyer at Ignition Law, specialising in working with start-ups, scale-ups and entrepreneurs across a range of industries.
Ignition Law is a unique entrepreneurial law firm in London, providing specialist corporate, commercial and employment advice to start-ups, scale-ups and entrepreneurs.