Female Entrepreneurship: Overcoming Funding Bias

Despite strides in entrepreneurship, female founders in India continue to face significant funding biases, hindering their access to capital. A recent report by Encubay sheds light on the stark disparities in funding between ventures with male and female founders. From June 2023 to February 2024, only a fraction of funding deals went to ventures led by women, highlighting a systemic issue within the Indian startup ecosystem.

The Funding Disparity: Out of 799 funding deals during the mentioned period, a mere 163 ventures with female founders secured funding, underscoring the gender imbalance in investment allocation. While startups collectively raised $6,646 million, female-founded ventures received a paltry $300 million, representing a mere 4.5% of the total funding. Such discrepancies indicate a pressing need for gender-inclusive funding practices.

Notable Ventures Defying the Odds: Despite the funding challenges, several female-led ventures showcased resilience and innovation in securing investments. GIVA, an online fashion jewelry startup, raised $33 million, while Blue Tokai Coffee Roasters and The Sleep Company secured $30 million and $23 million, respectively. These success stories underscore the potential of female entrepreneurship in driving economic growth and innovation.

Investor Landscape and Advocacy Efforts: Leading investors such as Fireside Ventures, Titan Capital, and Rainmatter Capital have recognized the importance of supporting female-founded ventures. Additionally, VC funds like AWE Funds and She Capital, led by Seema Chaturvedi and Anisha Singh, respectively, have actively championed women entrepreneurs. However, broader systemic changes are needed to address deep-rooted biases and ensure equitable funding opportunities.

Call for Gender Parity and Inclusive Practices: India’s ranking of 135 out of 146 countries in gender parity underscores the urgent need for action. With less than 3% of VC funding allocated to women, there is a clear imperative to dismantle existing barriers and foster a more inclusive entrepreneurial ecosystem. Initiatives promoting financial literacy among women and advocating for gender-sensitive investment practices are crucial steps toward achieving gender parity in funding.

Conclusion: The Encubay report highlights the persistent challenges faced by female founders in accessing funding in India’s startup landscape. While notable strides have been made, systemic biases continue to impede the growth and success of women-led ventures. It is imperative for stakeholders across the ecosystem to collaborate and implement measures that promote gender parity and enable women entrepreneurs to thrive. Only through concerted efforts can India unlock the full potential of its diverse pool of entrepreneurial talent

Re-reported from the article originally published in The Mint