Can a rise in female angel investors help close the funding gap?

Photo-by-Tim-Gouw.jpe - Research last month from the Women’s Business Council and Deloitte found the proportion of women starting their own firms fell in 2014, despite a record number of new company registrations. There are a range of reasons why – limited access to mentors and networks, lack of self-confidence and a ‘lower appetite for risk’ among some female entrepreneurs.

The lack of female investors out there may also play a part. There are numerous routes to funding but angel investment is still mainly driven by men. Considering we often hear that investors invest in those with characteristics they see in themselves, it’s not surprising to note there can be a pattern to the ‘type’ of businesses that receive funding. A study of 220 UK start-ups by Startup DNA found male entrepreneurs are 59% more likely to secure angel investment.

The situation is improving, though. Women now represent one in seven angel investors in the UK, double the rate in 2008, according to the UK Business Angels Association and the Centre for Entrepreneurs. But that’s still a big disparity. Rich lists might still be populated primarily by men, but the gap is closing. CEBR research back in 2005 suggested women now own 48% of Britain’s assets.

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