In a decade of technology-focused angel investing, I've often heard the comment that we need more women in technology – and, in particular, more female founders. In fact, more often than not it's me making the comment, as I'm an active backer of female entrepreneurs. But in the last five years, I've noticed the tide is turning – and at last we are actually seeing more female founders. So, have we now reached a tipping point?
I have invested in 40+ companies to date, of which 15 have a female founder or CEO. They include Kaidi Ruusalepp, Funderbeam, Fotini Markopoulou, Doppel, Emma Sinclair, Enterprise Alumni, Giorgia Longobardi, Cambridge GaN Devices and Sarah McVittie, Dressipi. They all have certain traits in common. As well as entrepreneurial skills, these include leadership abilities and tenacity. They are multi-skilled, team players – and they're not afraid to speak up.
I hope these women will become the role models for the next generation of female business leaders – following in the footsteps of people like serial entrepreneur Sherry Coutu and Last Minute founder Martha Lane Fox and igniting that entrepreneurial spark in girls at an early age.
Although we've seen great progress in recent years, make no mistake – there is still a mountain to climb.
For every £1 of venture capital (VC) investment in the UK, all-female founder teams get less than 1p, mixed-gender founder teams get 10p – and all-male founder teams get 89p. This was just one of the sobering statistics to emerge from the government-commissioned UK VC and Female Founders report from the British Business Bank earlier this year. VC investment in start-ups with female founders is increasing – but the report found that progress is very slow. At current rates, for all-female teams to reach just 10% of all deals will take more than 25 years. Meanwhile, an overwhelming 83% of deals made by UK VCs last year had no women at all on the founding teams.
So how can we speed up the pace of change? Women currently make up only about a third of graduates gaining STEM degrees – science, technology, engineering and maths. But the roots run deeper than that. We have to think about why more girls don't study STEM subjects at school. There is an element of "you can't be what you can't see" – with a lack of high-profile female role models giving girls the subconscious message that science and technology subjects are not for them.
Even if women do emerge from the education system with a STEM degree and entrepreneurial ambitions, the funding hurdle can often prove even more challenging as they face a male-dominated investor community. People tend to invest in founders who are similar to them. There is also a data bias. Historically, more men than women have founded valuable businesses – so the statistics don't tell the whole story.
This is where mentors and sponsors have a vital role to play in levelling the playing field. A mentor's experience, advice and guidance can prove invaluable for female entrepreneurs navigating the unforgiving start-up environment. Equally, the more informal help and support of a sponsor can make all the difference when the going gets tough. Business networks also have a crucial role to play.
If we get this right, it's not just female founders who will benefit. Diversity is good for business – creating a positive feedback loop that attracts better talent, leads to more innovation and improves business performance.