Updated: Dec 1, 2022
There’s a big problem, and everyone seems to know about it.
Female entrepreneurs aren’t being funded at anywhere near the same level as their male counterparts. This occurs across industries and countries and hasn’t improved as more women have become investors. According to the State of European Tech Report for 2021, only 1.1% of all capital raised by tech start-ups went to all-female founded ventures. In my home country, the US, the situation isn't any better: only 2.4% of total VC investments went to companies with only female founders, according to Pitchbook.
Here’s why everyone should care about this.
Obviously, there’s the issue of equity. Products and services aimed at women should make it to market not just to improve the lives of the women they serve, but because women – who make up 51% of the world’s purchasing power – will buy them. Product testing should be conducted on women and should use women’s data, or we will continue to end up with a world built only for men. Perhaps most important for investors, however, is the large body of research saying that female-founded businesses perform better than those founded by men, delivering both higher revenue and profit. (See this, this and this.)
Why aren’t women getting funded? According to the research, there is an inherent bias against female entrepreneurs. They are most likely pitching to men who might not be familiar with products that female-founded businesses market to other women. Women are often more conservative in their pitches, while men are apt to overpitch and oversell. Women are asked more negative questions than men during their pitches, and their businesses are valued lower if they are trying to work in industries that are seen as stereotypically male.
So what are we going to do about it?
To support women with these challenges and ensure that more female-founded start-ups thrive, we are launching Breakthrough Labs, a long-term support community that offers research-backed support to help female-founded businesses succeed.
This website provides you all of the information you need to know about our current incubator, including that applications open in January 2023! But this isn't all we are planning. We want to tackle the big problem of women not getting funded, and to do that we have to address the issues from multiple directions at once. Thus our longer-term plans include the following:
So welcome to our journey at Breakthrough Labs. We won't solve the problem overnight, but we are committed to doing something about it. And we hope you'll join us along the way.