Women entrepreneurs consistently report difficulties in securing financing and particularly capital investments in their companies that would enable them to start up and scale. Women are more likely to be “discouraged borrowers” and are less likely to seek financing then men. They also face barriers. One study by Harvard University showed that when investors were presented with identical pitches made by man and a woman, they were more than twice as likely to invest in the man. Investors even ask different questions to women entrepreneurs than they do to men, focusing on downside risks rather than upside opportunities. At the same time, recent data does show that when we compare men and women across sectors, the financing gap diminishes. However, there is little doubt that stereotypes and bias and the under-representation of women in venture capital or in the investment branches of traditional financial institutions play a role.
The Women Entrepreneurship Knowledge Hub and partners are looking at what barriers women entrepreneurs face when it comes to accessing capital from traditional financial institutions, venture capitalists and angel investors and why these barriers exist.