Female-led businesses have closed the gender funding gap in GreenTech
- In the run up to COP26, a new industry report reveals that female-founded businesses have now closed the gender funding gap in GreenTech1
- £2.8bn in equity finance has been raised by female-led GreenTech businesses since 2018
- However, a shortfall of £1.6bn still remains, with female-led businesses raising only 15% of all equity finance
26 October 2021: Female-founded, equity-backed businesses have now closed the gender funding gap in GreenTech, according to a new report from the Female Founders Forum – a partnership by think tank The Entrepreneurs Network and Barclays.
Having raised £2.8 billion since 2018, female-led businesses have received 42 per cent of all venture capital going towards GreenTech businesses – more than an equal proportion of equity funding.
The report, Inspiring Innovation, also reveals that female representation in GreenTech is higher on average than other sectors, with more than a third (34 per cent) of businesses being female-founded.
One of these GreenTech companies, Greyparrot, is changing the way businesses deal with their waste. Using AI, the company is able to analyse, in real-time, the types of waste making its way along conveyor belts in order to increase recycling rates. To date, they have raised £4.1m in funding from investors and £500,000 from Innovate UK.
Mikela Druckman, Co-Founder and CEO of Greyparrot, said: “Globally, we produce more than two billion tonnes of solid waste every year and only 19% of that is actually being recycled. When China decided to stop accepting waste from other nations for recycling in 2018, it created a shock to the global waste trade ecosystem. It really brought to life that there’s this huge problem that has to be solved.
“I was incredibly inspired by examples of women who had to break barriers in their fields, and I knew that I wanted to be able to do the same for the next generation. When most of the people in the room are still all male, it can create an imbalance. But being able to be connected with peers going through the same thing is incredibly beneficial to the entrepreneurial journey. It's not an easy journey. But it's probably one of the most rewarding journeys you can ever have.”
However, even with such progress in GreenTech, the amount of equity finance raised by female-led businesses has remained static at 15 per cent for the past five years, despite 25 per cent of businesses having at least one female founder. This shortfall in equity funding is equivalent to £1.6 billion.
In sectors such as Life Sciences, the funding gap is even more stark. Almost a quarter of businesses are led by women (22 per cent), yet they only receive 4.5 per cent of all equity funding.
Aria Babu, Head of the Female Founders Forum, said: “It’s encouraging to see the gender funding gap start to close, but there is still a way to go. We know women start businesses with on average half as much money as men do, so raising equity finance is critical. However, due to unconscious bias, Venture Capitalists are more likely to invest in people just like them – and with half of firms not having any female investors, female founders are massively on the back foot.
“The last 18 months have demonstrated the importance of innovation, from life-saving developments in Life Sciences, to technology bringing our society together. It’s incredibly important that female founders in all sectors are receiving proportional backing from investors, to ensure no opportunities are missed and the UK stays at the forefront of innovation.”
Katherine Morgan, Head of High Growth & Entrepreneurs at Barclays, said: “It’s inspiring to see female entrepreneurs leading the charge in GreenTech. In the run up to COP26, innovations from these companies will be vital in helping the UK reach its target of net zero by 2050. However, despite this sector setting the standard, overall progress is stagnant – and we need investors to help women in all sectors succeed.
At Barclays, we’re committed to connecting more women with the right finance and providing skills to this generation of female entrepreneurs, as well as the next.
Head of High Growth and Entrepreneurs, Barclays
“At Barclays, we’re committed to connecting more women with the right finance and providing skills to this generation of female entrepreneurs, as well as the next. I’m continually amazed by the innovative businesses we work with, such as Greyparrot, and I know these female entrepreneurs will continue to inspire the next generation of female-led STEM businesses. However, we need a collective effort across the industry to ensure we’re doing everything we can to make the UK the best place in the world to be a female entrepreneur.”
- Ends -
To read the full Inspiring Innovation report 2021 visit: https://www.tenentrepreneurs.org/s/Inspiring-Innovation.pdf
To find out more about Barclays support for Women in Business visit: https://www.barclays.co.uk/business-banking/sectors/women-in-business
Notes to Editor:
1Beauhurst (August 2021)
The Inspiring Innovation report delves into the gender funding gap in five key industries – GreenTech, Life Sciences, FinTech, E-Commerce, and AI – all highly innovative and tech driven sectors that can help boost the UK’s health, wealth, environment and productive output.
The report suggests that there are four main barriers that may be preventing female-led businesses from starting up or reaching their full potential: access to equity finance; underrepresentation of female students in STEM subjects; unequal household and childcare responsibilities; and limited access to networks and mentoring opportunities.
About The Female Founders Forum
The Female Founders Forum is a project co-created by TEN and Barclays. It was set up by The Entrepreneurs Network in partnership with Barclays, to encourage, support and promote female entrepreneurship. We seek to connect some of the UK’s most inspirational female entrepreneurs with those on the cusp of rapid growth.
About The Entrepreneurs Network
The Entrepreneurs Network is a think tank for Britain’s most ambitious entrepreneurs. We bridge the gap between entrepreneurs and policymakers, with the aim of making Britain the best place in the world to start and grow a business. We have a network of over 10,000 entrepreneurs and are the Secretariat of the All Party Parliamentary Group (APPG) for Entrepreneurship, which sits across the House of Commons and House of Lords.
Barclays is a British universal bank. We are diversified by business, by different types of customer and client, and geography. Our businesses include consumer banking and payments operations around the world, as well as a top-tier, full service, global corporate and investment bank, all of which are supported by our service company which provides technology, operations and functional services across the Group.
Barclays commitments to the Investing in Women Code
Barclays is a founding signatory of the HM Treasury Investing in Women Code, a commitment from the financial services industry which was launched in 2019 to improve female entrepreneurs’ access to tools, resource and finance. Barclays has committed to:
- Helping female entrepreneurs across the UK to start up and succeed.
- Connecting female-led businesses with the finance and support they need to succeed.
- Providing skills for this generation and the next to help them into entrepreneurship.
Beauhurst provides research and insight on the UK’s high growth companies. Our data platform allows professionals to discover and track Britain’s most ambitious businesses in unrivalled detail.