Bright Spots - Part I

WLBs on the Rise Despite Odds

From 1997 to 2013, the number of women-led businesses (WLBs) increased almost 60 percent and grew at a rate that was nearly 12 times the national average. Not only are more women founding companies, they are founding efficient companies that are producing better than average returns for investors. However, they continue to be underserved by venture and other early stage capital. Launch Angels just produced a white paper, Bright Spots: Women & Capital, which explores how WLBs are on the rise despite funding gaps. The paper also identifies gender parity campaigns that have succeeded against overwhelming odds. Following are some fast facts from the paper:

• It is harder for women-led startups to raise capital: While the exact number is difficult to calculate, it is estimated that only 4.2 to 7 percent of money invested by venture capitalists is invested in women-led businesses.
• Women are successful business leaders: The truth is that not only are WLBs successful, but they are efficient and have proven to do more with less capital. In fact, the Kaufmann Foundation found that compared to male-owned counterparts, women-led high-tech companies delivered a 35 percent higher ROI, and 12 percent higher revenue to venture investors.
• Women are innovators: The number of women listed as inventors on patents filed in the United States doubled to 18 percent between 1990 and 2012, and according to research by the Global Entrepreneurship Monitor, women lead men in total entrepreneurial activity relating to innovative products and services.

Women are proving that they are capable of building strong businesses, with innovative ideas, and great returns for investors, and now it’s essential for the industry to promote change and the diversification of investing. But how do we pave the way to gender equality? Check back for Part II of our Bright Spots blog series that will explore the “how” and download the full white paper in the meantime.