Female entrepreneurs could add £250 billion to the UK economy with equal access to funding and right support, according to the Business and Trade Secretary and Minister for Women and Equalities, Kemi Badenoch.
This comes following the Government’s publishing of the third annual Investing in Women Code (IWC) report, revealing that the significant progress made in breaking down the finance gap between female and male entrepreneurs.
The IWC now covers a large proportion of the SME lending market, accounting for 39 per cent of UK venture and growth equity deals, an increase from 24 per cent in 2020.
The report also showed that 35 per cent of all venture capital deals made by IWC signatories were in female-founded companies in 2022, compared to the market average of 27 per cent.
The IWC was founded four years prior as a landmark government-lead initiative as a result of the Rose Review’s findings that a lack of funding support acts as one of the most significant barriers to women seeking to effectively scale a business.
Commenting on the findings, Sheila Flavell CBE, Chief Operating Officer for FDM Group, added: “The report demonstrates how important progress has been made, but further work must be conducted in order to close funding gaps. Providing equal access to finance will be the necessary boost to unlock the potential of female founded businesses and will help bolster the Government’s commitments on growing the economy further – even amongst the challenging economic backdrop, the issue should not be dropped.”
“The actions of signatories implementing various measures to improve their support for female entrepreneurs is crucial in boosting confidence. Implementing policies, female-focused networking, the recruitment from a more diverse pool of candidates and the offering of mentoring from other female founders to name a few are some of the key efforts necessary to achieving gender equity in the start-up system.”
200 plus organisations have signed up to the IWC, depicting the growing number of people committed to increasing the levels of financial support toward women-led businesses, and highlighting how the code is the leading way in addressing the pervading finance gap.
Business and Trade Secretary and Minister for Women and Equalities Kemi Badenoch said: “It’s excellent that members of the Investing in Women Code are leading the way in addressing the finance gap between male and female entrepreneurs, ensuring that the UK is the best place in the world to start a business, regardless of gender.”
The findings also showed how female investors remain underrepresented on investment committees. Signatories report an average of 32 per cent female representation in their investment teams, and less than a quarter (24 per cent) on their investment committees.
The report additionally highlighted a relationship between more diverse investment committees, and successful pitches from all-female and mixed gender leadership teams, becoming a crucial area to address.