![]() ![]() The solution is not for VCs to suddenly start supporting startups simply because they’re founded by women. VCs should support human-centered businesses Research published in the Journal of Entrepreneurship & Organization Management found that women-led businesses are more likely to be focused on making a social contribution and building good relationships with employees.īut clearly, all the arguments in favor of supporting women-led businesses have not been enough to turn the tide among investors. The events of the past year have put a spotlight on inequalities in both society and business. This isn’t the only reason women-led businesses are essential to the recovery. Women have been dropping out of the workforce in droves, making up most of the people who want to work but are not counted in unemployment figures. Companies with a female founder and a female executive hire six times more women. Startups with a female founder fill their staffs with 2.5 times more women, according to an analysis by Kauffman Fellows, a program designed to accelerate entrepreneurs’ success. These businesses hire more women as well. Also, that process can help build resilience and adaptability, two crucial business skills for entrepreneurs.īut it isn’t just ROI that makes women-run businesses an important boon for the economy. ![]() One possible reason is that the heavier pushback by investors may mean that these businesses have to have especially strong business plans. They “ultimately deliver higher revenue - more than twice as much per dollar invested,” a Boston Consulting Group analysis found. When women-led startups do get funded, they’re more likely to be successful. Women-led startups employ more women, and have a different focus It’s also likely to slow the recovery and efforts to tackle inequality. It affects the overall jobs picture for women exponentially. The lack of gender equality in funding startups leads to further problems. When women venture capitalists do make the decisions, they’re twice as likely to invest in female founding teams. Of all partners at these firms, only 2.4% are female founding partners - who, as Fast Company notes, “control an outsize proportion of a firm’s investment decisions.” And even when going outside their networks, many investors may be sticking with “ pattern-matching habits,” seeking the same kinds of companies that they’ve supported in the past, which are often tech companies led by men.Īfter all, only about 12% of decision makers at VC firms are women, and most firms still don’t have a single female partner, according to an analysis last year. Some speculate that the pandemic made investors more wary of risks and more likely to stick to their existing networks - which is very much a “ boys’ club” and tougher for women to break into. It will likely be some time before all the reasons for this precipitous drop are clear. The 2.8% figure, while paltry, was an all-time high. ![]() In 2019, 2.8% of funding went to women-led startups in 2020, that fell to 2.3%, Crunchbase figures show. This wasn’t just part of an overall decrease in VC funding. And the greater need for care work has often led to more women dropping out of the workforce.īut there’s another big shift that has more recently come to light, as figures from 2020 have been tallied: a substantial drop in venture capital funding for women-led startups. Fields heavily populated by women have experienced greater layoffs, with a McKinsey analysis showing women’s jobs 1.8 times more vulnerable than men’s. Throughout the pandemic, the disproportionately adverse impact on women’s careers has received a great deal of attention. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |