Lack of female decision-makers the largest barrier to funding, says survey

The lack of female decision-makers is the largest barrier to closing the gender funding gap, a new survey has found.

Pink Salt Ventures, the UK’s first venture capital firm for female founders, has published the results of its most recent survey, revealing startling new data and attitudes about how male and female founders are treated by investors – and the consequences.

The survey of 90 female founders, was conducted in partnership with Dr Dana Kanze, an expert on gender bias in venture capital and Pink Salt Ventures’ advisor.

The findings showed 97 per cent of respondents acknowledged a fundamental difference in how investors treat male and female founders, with 83 per cent citing the lack of female decision-makers as the largest barrier to funding.

Additionally, the report revealed 76 per cent of participants believed there is a lack of awareness of what a VC-backable business is. The findings, and the actions required, were echoed by leading female and male entrepreneurs.

“Our survey’s results are clear: a fundamental gender funding gap exists, which is to the detriment of female founders looking to scale their firms,” said Samira Ann Qassim, co-founder and partner at Pink Salt Ventures.

“This is a wake-up call for investors to take action to ensure female founders have the same opportunities as males.”

Saloni Bhojwani, co-founder and partner at Pink Salt Ventures, said there is a huge opportunity to drive growth in the industry by backing underfunded talent.

“Generationally speaking, the pipeline of female entrepreneurial talent only continues to grow, and our research shows what the ecosystem needs and is asking for: more dedicated capital, networks and access to scale their companies.”

Dr Dana Kanze, associate professor of organisational behaviour at London Business School, said: “These rich insights show the urgent need for investor-side, rather than founder-side, reform.

“Female founders are clamouring for this, and are badly in need of VC funds allowing for cold introductions, plus access to non-financial resources and specific guidance at a time when they are too early for consideration.

“Until female founders receive the funds they need at the valuations they deserve, they won’t participate in the liquidity events that can enable them to become serial entrepreneurs and investors themselves.”

The survey complements conclusions recently reached by the Harvard Business Review that female founders are two times less likely to secure post-seed funding than males and data from Pitchbook suggesting female founders raise less capital at lower valuations and exit their businesses quicker, proving they can do as much as their male peers with less.

Figures like Tamara Hill-Norton, founder of Sweaty Betty, said LPs can get more female founders funded by having a gender focus in their investments.

“I invested in Pink Salt Ventures because it is the first and only fund I know of in the UK – to have that gender lens focus – solely on female-led businesses,” she added.

Irish businessman Bryan Meehan, executive chairman at Blue Bottle Coffee and an LP in Pink Salt Ventures, said: “It is time the global VC industry wakes up to its inherent blind spot in funding females and people of colour.”