Nov 24, 2014

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Infographic: The Case For Investing In Women

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Did you know that though women make up more than 50% of the U.S. adult population, they only account for 35% of the people who “get involved in starting businesses.” It’s sad, but true.

According to an infographic shared by TheRepresentationProject.com, this discrepancy is due in part to the fact that female entrepreneurs have a much harder time securing venture capital and angel investments than their male counterparts. Below are just a few startling takeaways from this eye-opening infographic.

Regarding the acquisition of capital:

  • Women start ventures with up to 8% less funding than men.
  • 41% of female entrepreneurs relied on outsider debt (loans) to start  their business.
  • Though 21% of female entrepreneurs sought angel capital in 2009, only 9.4% of them were successful in securing an investment.
  • In 2009, only 11% of companies that received venture capital backing had a female CEO or founder.

Regarding performance and growth

  •  Women ask for exactly what they need, but only end up with 50% of what they require from investors.
  •  Female CEOS deliver higher revenues using less capital than those by men.
  •  Female entrepreneurs in wealthier economies “tend to have half the growth expectation of men.”

A case for women investing in women

So if female entrepreneurs are doing a lot more with a lot less capital, why aren’t angel investors and venture capitalists flocking to invest in them? Well, perhaps because, at present, the venture capitalist world remains a boys club–for now.  According to the infographic, female entrepreneurs have fewer first-degree network connections with the gatekeepers (men) in positions to hire them. Furthermore, “women entrepreneurs sometimes believe they have strong links to the VC world, but the men, are unlikely to recognize the relationship.”

All this means is that we need more female “gatekeepers” and venture capitalists. That’s where companies such as the Pipeline Fellowship (founded by LTB speaker, Natalia Oberti Noguera) come in. Such organizations create and strengthen a network of female investors, VCs, and entrepreneurs that ultimately begets more investors, VCs and entrepreneurs. Call it the circle of startup life. 

The statistics represented in the infographic below should not be the status quo. Now that we know what’s wrong with the system, we can start making moves to change it.

To view the full infographic, take a look below.

To learn more about the Pipeline Fellowship, visit: http://www.pipelinefellowship.com/

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Tanisha Love Ramirez

Tanisha Love Ramirez

Tanisha is the Managing Editor at NEW LATINA, and a social commentary and pop-culture writer/blogger from New York City. She studied Sociology and Women's Studies at Bowdoin College, where she developed a strong interest women's issues and community advocacy. Tanisha has written for the Bowdoin Orient and has interned at BUST Magazine and Jezebel.com.

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