Securing funding is challenging for all founders, but especially for women. The data show that women receive less than 5% of venture funds. 

According to the Kaufman Institute, there are three primary reasons for this funding disparity:

 

• Women tend to be in industries that are less growth oriented and less attractive to bigger equity investors such as retail and service.

• Women tend not to have formal social network access into substantial sources of financial capital, and are therefore less likely to seek/obtain equity investment from angels/VCs.

• The predominance of male decision makers at the VC firms leads to a situation where ideas may not resonate with these equity investor.

 

And yet, evidence is building that women’s involvement makes for a better outcome in the start-up space:

 

• Astia, a non-profit dedicated to identifying and promoting women high-growth entrepreneurs, members have a 60% fundraising success rate within one year of joining. In total, their companies have raised $1 billion.

• Springboard, an organization committed to building high-growth technology-oriented companies led by women, members have an 83% fundraising success rate and have raised $5.6 billion.

• Venture capital firms that invest in women-led companies outperform those that don’t, according to the Small Business Administration Office of Advocacy.

• Venture-backed companies that include more women on their senior management teams are more likely to succeed than companies with men-only teams, according to Dow Jones research.

   

There are more and more organizations tapping into the opportunity to focus on female entrepreneurs, The positive results experienced by early entries, such as Astia, Springboard, and Illuminate Ventures, are spurring others to jump on board, and the continued efforts of all these organizations will be an important factor in closing the funding gap and helping more female-led startups to succeed.

 

Soar wants to be part of this movement to increase awareness and help high-potential female-led businesses succeed.