Sometimes, it seems as if as much as things change for women entrepreneurs, they are standing still. That paradox couldn’t be more true than when discussing high-growth women entrepreneurs and their ability to raise capital. That is the #1 challenge women face when starting and growing their companies, found David S. Ricketts, Senior Innovation Scholar at the Technology and Entrepreneurship Center at Harvard. His comment is based on a survey of high-growth women entrepreneurs, angel investors, venture capitalists, government representatives, media, academics, researchers and corporate executives who attended a recent DWEN Research Symposium. By focusing on where change is happening, where it isn’t, and examining what interventions are working, we can facilitate even greater change.
Women start companies with 50% less capital than male counterparts, according Access to Capital by High-Growth Women-Owned Businesses. Female-founded Inc. 500|5000 firms are dramatically less likely to raise equity financing from angels and VCs than male-founded companies (14.4% versus 3.6%). They are also dramatically less likely to ask close friends (9.2% versus 1.8%) and business acquaintances (13.5% versus 5.4%).
There’s no doubt about it: women business owners face greater funding challenges than men. Some of the obstacles are internal, such as not dreaming big (so there is no need for outside funding) and some obstacles are external, such as discrimination.
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