New analysis shows a continuing trend of falling angel investment in female-led businesses.
The proportion of angel investors putting money into female-led businesses has dropped significantly over the last year, according to new analysis which says this is part of a continuing trend.
Business data platform mnAI says the total number of investors has also fallen with women investors – who are more likely to invest in female-led businesses – dropping significantly. The total number of investors is down from 274,789 in 2016/17 to 188,117 in 2020/21 – a fall of 86,672 investors. Between May 2016 – May 2021, the number of female investors dropped by 23,647, from 66,444 in 2016/17 to 42,797 in 2020/21. mnAI says the decrease in investors began in 2019/20, slipping by 33,933, then by 49,530 in the following year.
Its analysis shows that, over the last five years, the number of women investing in female-led businesses dropped by 6.05% and the number of men investing in those same businesses dropped by 11.76% over the same period of time. Its figures show the number of women who invested in female-led businesses in 2016/17 was 18,671 (28.1%), but by 2020/21 that number had fallen to 11,298 (26.4%).
The total number of male investors in 2016/17 was 163,829, of those, 41,776 (25.5%) were backing businesses with at least one female founder. By 2020/21, the total number of male investors had dropped to 115,034 and the number of those investing in female-led businesses has dropped even more, with just 25,883 (22.5%) opting to put their money into female-led businesses.
A spokesperson for mnAI says: “The trend toward female businesses being overlooked in favour of the alternative has been gradually growing over the last few years, with the percentage of angels investing in female-led businesses decreasing. The percentage of angels investing in female businesses has been decreasing year-on-year since 2016/17 and has shown no signs of stopping up to now. This clear decrease in the numbers brings with it a lot of questions about the future of female-led businesses and how they can achieve that crucial funding to get their business off the ground.”