Why Women Entrepreneurs Don’t Receive Funding

I recently completed a webinar reporting the findings of our Global Entrepreneurship Monitor (GEM) Women’s Report.  This study compared women’s and men’s entrepreneurship in 59 economies around the world. One of the key findings is that women tend to close their businesses because they have challenges in getting funding.  We know from earlier research on women led ventures seeking equity capital, that a tiny percentage of women actually receive VC (estimates are less than 6% of all US Venture funded businesses are women led- The Diana Project.org).

Why is it that women have more difficulty in obtaining financing, growing and sustaining their businesses? One reason often missed has to do with perceptions about women entrepreneurs.  In class- I often ask students to “name a successful entrepreneur” – it usually takes 6-10 shout outs before a woman is named.  The tendency is to ascribe the characteristics of successful entrepreneurs as male.   We think of entrepreneurs as being heroic figures, who single handedly invent the idea of the business, take big risks, and aggressively grow their ventures to achieve economic wealth. This perception is mostly a myth.  Research shows that entrepreneurs tend to take calculated risks, that they often don’t invent the technology (they buy, license or collaborate on it), that more successful businesses are founded by teams and that increasingly businesses are providing both social and economic wealth.

This profile of the successful entrepreneur is mostly male gendered.  The implication is that someone who has an interest in family, solving a social problem,or  has a collaborative leadership style may not be fundable, and therefore, may have more challenges in accessing growth capital.

One solution recently offered by Jack Welch was that women should just “perform better” – this seems very simplistic- as it implies that the problem is a “woman’s problem” and they are fully responsible for their own situation.  Alternatively, it may be time for the media, educators, and funders to recognize that successful entrepreneurs are not all like Bill Gates or Jeff Bezos. Instead, they may be like Helen Griener (I-robot), Donna Dubinsky (Palm), orCher Wang (HTC).

Candida BrushCandida Brush, Contributor

article from Forbes.


About CoffeeWithKath

Passionate about Technology in Education and how it can make a difference in the lives of students with Dyslexia. Founder of @ForDyslexia. Mom of twins. Juggling entrepreneurship and kids.

One comment

  1. Pingback: My delayed post on the New York Times Article… VC’s are you paying attention? | The Makings of a Dream Life

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