Did you know that women in the UK launched more than 150,000 companies last year?
According to the recently released Rose Review Report 2022, a fifth of all new corporations were female-led. And Gen Z has officially entered the market: the biggest increase in female-led companies were launched by 16-25-year-old founders — numbers rose by almost a quarter from the previous year.
But what really caught our attention? The data collected also demonstrated that up to £250 billion could be injected into the UK economy if women matched men when it comes to starting and scaling businesses.
The issue, however, isn’t with women starting. Women are certainly bringing their ideas to life — yet over half of women have to self-fund, compared to only 26% of companies run by men. When it comes to scaling, the ability for female-founded or female-led brands to get funding (or into accelerator/incubator programs), is disproportionately skewed to the number of companies being launched by women. The stats don’t lie: female-run companies attract less investment than those led by men. Even when we know that companies with female founders perform 63% better than those of their male peers.
The Gender Index, a large-scale study of UK-based female entrepreneurship, discovered that under 17% of all active UK companies are led by women, but they only managed to attract less than 12% of 1.3 million investments made in the country. On average, female-led brands receive £644,000 in total funding, compared to a staggering £4.34 million for the male equivalents. And on the other side of the Atlantic, Forbes reports that for every $1 men raise in early-stage venture capital, women only raise an average of $0.38.
At Appear Here we champion the independents, but that doesn’t mean we shy away from addressing the underlying gender-gap issues across entrepreneurship. We always support the underdog. We want to make launching your idea as accessible as possible. So, what’s a female founder to do?
We'd recommend tapping into the power of community as much as possible. What does this actually mean? Network, hard, and identify like-minded founders, and other female-led brands you could collaberate with. Strategic partnerships, even in the form of pop-up campaigns and competitions, make a lot of sense. It can be a fun and highly effective 'growth hack' strategy.
Depending on your business, it might also make sense to look to female-led funds and angel investors — women VC partners are twice as likely to invest in startups with a female founder and more than three times as likely to invest in startups with a woman CEO. But you better do your research as only 14% of angels identify as women in the UK. In The States, it’s worse: only 4.9% are women — 33% of whom being women of colour. In fact, less than 1% of total venture capital in the US goes to Black entrepreneurs.
Women in venture capital need access and awareness — in equal measure. The aforementioned Rose Review Report of female entrepreneurship plans to increase the UK’s pool number up to 30% by 2030 through its launch of a nationwide Women Backing Women campaign from the Women Angel Investment Taskforce. Women in VC is another organisation working to address this problem that’s curated the world’s largest global community for women in venture capital; a space for them to connect, collaborate, and create new opportunities. Another firm looking to close the funding gap (on all fronts) is Backstage Capital, a VC fund that has invested in more than 130 startups led by either POC or LGBTQIA+ founders. The Female Founders Fund invests in brands with a female focus, and has invested in a wide range of ventures, from Peanut, the motherhood to menopause app, to Billie, the female-first shave and body brand.
Still working on making your side hustle your main hustle? Even if you're not really thinking about investment, you may have an expansion in mind in years to come. Here’s some good news for you. With the younger generation now taking up space, launching brands and companies at record rates, there is hope for change — we know this young yet thirsty lot deeply care about diversity and inclusion, and it shows in how they do business.
A survey of 200 US tech funds found that the 22-35 age range had the greatest diversity in business partners, with almost 40% of them non-white. The financial consultancy went on to suggest that as Gen Zers move into the business sector, this trend will only grow — founders are set to become more diverse, and their impact set to be greater.
In summary, there's still a lot of work to be done. But female-led entrepreneurship is trending in the right direction, and we're excited about it! Over half of stores opened with Appear Here are female-led brands, and we look forward to another exciting year in retail as we continue to make our streets accessible to all.
Whether you're a first-time entrepreneur or a digitally-native, investment backed startup, creating a space for your community IRL is increasingly important. Get in touch and we'll help you create the perfect space for your brand.