Report highlights lack of investment in female-led companies

A new report shows that women-led companies, though increasing, get significantly less investment than male-led ones, particularly from venture capital and private equity.

Female business leader conducting a meeting


Just 11.9% of investment in business goes to female-led businesses in the UK, with venture capital and private equity investment hugely skewed towards men, according to a new report.

The Gender Index, based on data generated by the analytics company mnAI, says that female-led companies make up 16.8% of companies, three and a half times smaller than male-led companies. However in 2021, 20% of newly incorporated companies were female-led.

Its analysis shows 66.1% went to male-led companies whereas female-led companies obtained nearly six times less investments (11.9%) than male-led companies.

For female-led companies, the majority of identified investments were made by angel investors, with the UK average at 83.8%. Just under a third of angel investors in the UK are female. The top three sectors for female angel investment were: professional, scientific and technical services; information, communication and technology; and real estate

Investment by venture capital and private equity made up a very small percentage of investments in female-led companies – less than 1% of investment in any one region while the UK average was 0.5% for the former and 0.1% for the latter.

The report also found that the under-representation of female-led companies is more pronounced when it comes to high growth companies.

In addition, it found that there is no conclusive correlation between the size of a company and its leadership, although female leadership does tend to decrease as the size of a company increases. The regions with the highest percentage of high growth female-led companies are Wales and Scotland, both at 12%.

The highest proportion of male-led high growth companies are medium-sized organisations while the lowest are small companies. By contrast, female-led high growth companies are most frequent in small companies and least frequent in medium-sized companies, although the numbers are very much smaller than for male-led companies. The North East has the lowest percentage of female-led high-growth businesses.

The data also found that:

  • London has the highest female leadership at 18.3% while Northern Ireland has the lowest rate of female leadership at 13.5%. On the other hand, Northern Ireland has the greatest percentage of male-led companies at 65.1%
    while the South West has the smallest proportion at 58.7%.
  • While all sectors are male dominated for leadership, the extent of that domination can fluctuate drastically. Health, wellbeing and social care activities have the largest percentage of female leadership at 35.3%,
    followed closely by education at 33%. Conversely, the energy supplier sector has the smallest percentage of female leadership at 4.5%. Male-led companies are most common in the energy supplier (77%) as well as construction (74.3%) and least common in health, wellbeing and social care (36.4%) sectors.
  • Turnover growth by percentage and company size favoured smaller companies which outperformed their larger counterparts.

Jill Pay, chair of The Gender Index, said: “Mapping the impact that female-founded companies have on the UK economy, uncovering their potential and supporting their growth, is paramount to a more inclusive, diverse and stronger economy…Our ambition is to ensure that greater support is provided to female-founded companies, helping to accelerate and stimulate fiscal and corporate growth.”

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